Kozlowski v Kozlowski - [2011] SADC 89

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
KOZLOWSKI v KOZLOWSKI
[2011] SADC 89
Judgment of His Honour Judge Stretton
24 June 2011
REAL PROPERTY - GENERAL PRINCIPLES - INCIDENTS OF ESTATES AND INTERESTS IN LAND - ESTATES FOR LIFE
A property was bought in 2002 with the plaintiff and her separated husband’s money and placed in the defendant her daughter’s name. The daughter contributed a small portion of the purchase moneys. The plaintiff moved in and resided in the property, subsequently caveating it. On the defendant warning the caveat the plaintiff brought action claiming an agreement between the parties that she be allowed to live there for life. That agreement was denied by the defendant.
Held: There was an agreement between the parties that the plaintiff be entitled to live in the premises for life.
Law of Property Act 1936 (SA) s 29, s 30 and 31, referred to.
Black v Pool (1895) 16 ALT 155; Zimbler v Abrahams [1903] 1 KB 577; Re Midland Railway Co's Agreement [1971] Ch 725; Australian Maritime Safety v Quirk (1998) NSW Conv R 55-858; Haslam v Money for Living (Aust) Pty Ltd [2008] FCA 1536; La Martina v Penney [1968] SASR 411; Regent v Millett (1976) 133 CLR 679, considered.

KOZLOWSKI v KOZLOWSKI
[2011] SADC 89
Introduction

This is an application by the plaintiff Maria Kozlowski for a declaration that she has a life interest in property situated at Farr Street, Woodville North, (“the property”) and is entitled to the sole use and occupation of it, and that the Registrar General register such interest, and a cross-action by the defendant and the owner of the property her daughter Julie Kozlowski, for a declaration that the plaintiff has no legal or equitable interest in the property, and accordingly that the caveat the plaintiff has placed on it be withdrawn.
Background
The plaintiff is the mother of the defendant. It is common ground that in 2002 the defendant became the registered proprietor of the property situated at Farr Street, Woodville North, pursuant to a contract of sale between a third party vendor and the plaintiff or her nominee. That contract for sale was signed on 7 October 2002[1] with the transfer to the defendant completed on 12 December 2002[2].
[1] See exhibit P6 Contract for sale and purchase of land.
[2] See exhibit P2 Historical search dated 24 November 1993.
It was ultimately common ground that the source of the funds for the purchase price of $325,000.00 which together with stamp duty and other transaction costs totalled $356,797.00[3], was a deposit of $10,000 provided by the plaintiff[4], a further $54,319.02 from the plaintiff[5], and $240,680.98 from the account of Marian Kozlowski[6] with the remaining sum provided by the defendant as a result of her taking out a mortgage in the amount of $41,797.00[7]. Marian Kozlowski was the separated husband of the plaintiff and the father of the defendant.
[3] See exhibit P10 Settlement statement dated 29 November 2002.
[4] See exhibit P7 Receipt for $10,000 to the plaintiff and exhibit P8 Plaintiff’s bank book indicating a withdrawal of $10,000 on 24 October 2002.
[5] See exhibit P8 Plaintiff’s bank book indicating withdrawal of $54,319.02 on 5 December 2002, exhibit P9 Marian Kozlowski’s bank book indicating deposit of $54,319.02 on 5 December 2002 and withdrawal of $295,000.00 in favour of the defendant on 5 December 2002, and P10 Settlement statement re: the transaction.
[6] See P9 Bank book of Marian Kozlowski.
[7] See exhibit P10 Settlement statement indicating mortgage funds contributed by the defendant.
It is common ground that although the contract for the purchase of the property at Farr Street, Woodville North was signed by and initially in the name of the plaintiff, the property was transferred from the vendor into the name of the defendant at settlement.
It is also common ground that the plaintiff moved into that property forthwith and has resided there since that time, for approximately eight years at the time of trial. During that time the plaintiff has paid all the day-to-day outgoings relating to the property, while the defendant has made all payments in relation to the $41,797 mortgage.
It is also common ground that in August 2004 the plaintiff lodged a caveat on the property claiming to be entitled to an estate in the land and lodged a further caveat over the land in August 2009 claiming a life interest in the land[8].
[8] See exhibit P18 caveat dated 31 July 2009 lodged on 10 August 2009.
The 2009 caveat was warned and as a result these proceedings were instituted.
The primary issue
The plaintiff claims that when the property was purchased in 2002 there was an agreement with her daughter, the defendant, that whilst it would be put in her daughter’s name to secure it for her daughter in the future, the plaintiff would be entitled to live there for the rest of her life. The plaintiff claims she contributed a significant portion of the purchase price, together with a significant amount of further monies belonging to her separated husband, Marian Kozlowski, with his agreement, and agreed she would pay all bills and outgoings on the property.
The plaintiff claims that her daughter the defendant agreed to take out a small mortgage for the remaining monies to settle the property and would make the mortgage payments on that loan. The agreement was that whilst it would be her daughter’s property, she the plaintiff could live there for the rest of her life.
The defendant denies that there was any agreement that her mother could live there for any extended period and certainly not for the rest of her life. The defendant claims that she allowed her mother to live there for a short period of time to enable her mother to renovate her mother’s existing premises, but that her mother moved in and never moved out.
The defendant was living rent-free in another property owned by the plaintiff at Hooper Street, Paralowie since before the acquisition of the Farr Street Woodville North property. It seems matters came to a head in June 2009 when the plaintiff discovered that the defendant had moved out of the plaintiff’s property at Hooper Street Paralowie and was renting it to tenants, without the plaintiff’s knowledge or permission. The plaintiff’s solicitors wrote to those tenants requiring vacant possession[9], and seemingly in response the defendant sent a letter to the plaintiff’s solicitor giving the plaintiff 10 days to vacate the property at Farr Street, Woodville North.
[9] See exhibit P15 Plaintiff’s solicitor’s letter dated 29 June 2009.
The primary issue in the case is whether there was an agreement between the plaintiff and the defendant that the plaintiff be entitled to live in the property for the rest of her life, and if so the consequential issue of whether she has a life interest or some other contractual or equitable right to live there. Finally, if she does have a life interest or other right to live there, what orders this court should make to give effect to those findings. That is of some consequence as the defendant has tried in the past to use the property as security for other borrowings and has been frustrated by the plaintiff’s caveat.
If the plaintiff’s evidence is accepted then there was an agreement that the plaintiff be entitled to reside in the premises for the rest of her life.
If the defendant’s case is accepted then there was no agreement that the plaintiff be entitled to reside at the property for the rest of her life. If the defendant’s evidence is accepted there was an agreement that her mother could live there for a short period of time sufficient for her mother to clean or renovate her existing premises. Such an agreement would not purport to create either a life interest or a contractual or equitable right to remain for the rest of the plaintiff’s life.
The Law
It is common ground in this matter that to create a valid life estate, writing is required unless sufficient acts of part performance are demonstrated.
Section 30 of the Law of Property Act provides that any interest in land created by parol not in writing shall have, notwithstanding any consideration having been given for same, the force and effect of an interest at will only. Section 31 provides however that nothing in section 30 shall affect the operation of the law relating to part performance. The effect of sections 29, 30 and 31 are that a life interest in land granted verbally can be recognised if there has been part performance.
In this matter it is relatively clear that if there was an agreement to grant a life interest on the terms asserted by the plaintiff; that she would provide the majority of the purchase monies with the defendant providing a small proportion of them by way of mortgage and that the plaintiff would occupy the property and satisfy all outgoings apart from the small remaining mortgage taken out by the defendant which such payments the defendant would satisfy, then the carrying of that agreement into effect by the purchase of the property in the defendant’s name organised by the plaintiff, the plaintiff taking possession and satisfying all outgoings in relation to that property for the period to the date of trial, would constitute part performance of such agreement[10].
[10] See Black v Pool (1895) 16 ALT 155 at 156.
Whilst the defendant argued that those actions were not sufficiently unequivocally referable to the asserted agreement such as to constitute part performance, I reject that argument. It is not disputed that the plaintiff has actually performed all of the acts that constitute the terms of agreement that she asserted[11]. Complete performance of an agreement must necessarily constitute at least part performance of it.
[11] Although the existance of such an agreement is hotly disputed.
The remaining issue, if the plaintiff’s evidence is accepted, is whether a life estate was created, a lease for life granted or simply a personal right to occupy was given. The distinction is conveniently summarised in Butt, Land Law[12].
A life estate differs from a mere personal right to reside on land for life. But which of the two a testator or settler intends to create is sometimes difficult to discern. The effect of a provision in a will or settlement is a question of construction, turning on the words of the provision read in the context of the document as a whole. So far as any general proposition can be stated in an area where so much turns on context, it is that a right “to reside” or “to live” on land confers a personal right only, since it must be exercised in person, while a right to “use and occupy” a property points to a life estate since “use” or “occupation” may be exercised in person or through another (such as a tenant). In truth, this general proposition is no more than a “broad generalisation”. But it is a useful guide. Thus, a provision in a will permitting the testator’s widow to “continue to reside” in the family home created a mere personal right; while a provision allowing a beneficiary to have “full use and enjoyment” of a property “during her life time”, or “to be used by him as long as he wishes”, created a life estate. But since context may colour sense, the generalization must yield to a contrary meaning in appropriate circumstances. And so, depending on context, a right to “use, occupy and enjoy” a property may confer only a right of residence and not an estate in the land. (Footnotes omitted).
[12] Butt Land Law 6th edition, Law Book Company 2010, at para 10.06.
Further, Butt observes that a life estate also differs from a lease for life although historically courts sometimes treat a lease for life as a life estate, particularly where the property in question is a residence[13], citing the cases of Zimbler v Abrahams (1903) 1 KB 577, Re Midland Railway Co’s Agreement (1971) Ch 725 at 732, Australian Maritime Safety v Quirk (1998) NSW ConvR 55-858 at 56,713 and Haslam v Money for Living (Aust) Pty Ltd (2008) FCA 1536 at [23]-[25], in this respect.
[13] Butt, Land Law 6th edition, Law Book Company 2010, at para 10.06.1.
The fundamental issue will be whether the agreement properly construed intended to grant exclusive possession and a right to use the property as the grantee saw fit including for example renting it out, leaving it unoccupied or using it for anything else for the course of the grantee’s life, or whether on the other hand it reflected an agreement that the grantee be entitled to personally reside at the property during their lifetime[14]. The former may constitute a life estate, but the latter may amount to a mere personal right.
[14] For an example of the latter see La Martina v Penney [1968] SASR 411.
The evidence
The plaintiff gave evidence that she is 63 years old with two children. One child is the defendant and another is a male called Stefan. The plaintiff married in 1971 to Marian Kozlowski, separating in 1982 on account, she said, of mental and physical abuse. The marital home was at Sansom Street Woodville North and the plaintiff’s husband moved out when the separation occured. Nevertheless, the plaintiff said she maintained regular contact with her husband. She stayed in the marital home at Sansom Street Woodville North until the 2002 transaction the subject of these proceedings, whereupon she moved into the property in question at Farr Street Woodville North.
The plaintiff gave evidence that while her husband was alive she would buy his food and pay his bills. The plaintiff gave evidence that they bought property at Hooper Street, Paralowie in 1994 with funds from a car accident that her husband had had. A further property was purchased at Mendez Street, Paralowie in 1995, which was placed in her husband’s name.
The plaintiff gave evidence that after the car accident occurred, because her husband was badly injured she took him back to live with her at Sansom Street for seven months whilst he recovered. After that, he then returned to a property at Penola Road, Kilkenny.
The plaintiff gave evidence that her daughter had left home in her late teens and was initially living in Greenacres. She said there came a time when her daughter came and apologised for all the problems that her daughter had caused and promised that all would be well in the future. The plaintiff then said that her daughter could move into the Hooper Street, Paralowie property and live there rent free. The plaintiff said her daughter moved into the Hooper Street premises in 1996 or 1997. The plaintiff said that prior to 2002 the plaintiff’s relationship with her daughter was rocky and that there were problems with men and boyfriends.
The plaintiff also gave evidence that she did not have a good relationship with her son Stefan. Stefan was 11 in 1982 when the plaintiff separated from her husband.
By 2002, the plaintiff said her relationship with the defendant was good. The plaintiff said she noticed the property at Farr Street was for sale. The plaintiff said she attended four or five open inspections and asked the defendant to come and see what she thought of it. The plaintiff said she discussed with her daughter that she would buy it for her daughter on condition that the plaintiff could live there for the rest of her life. The plaintiff said she signed the contract for the purchase of that property the day before a scheduled auction. The contract for sale dated 7 October 2002 was tendered as exhibit P6.
The plaintiff said that at the time of signing the contract, her intention was that it would be in her own name but eventually she decided to put it in the defendant’s name. The plaintiff said that she wanted her daughter to have the security for the future of owning the property, as the plaintiff’s son could be very intimidating. The plaintiff was worried that if it remained in the plaintiff’s name, her son could be nasty and might ultimately try and get the property. The plaintiff said she also thought that if her daughter had a mortgage she would take some responsibility in her life. The plaintiff said she agreed with her daughter that she the plaintiff would pay all rates, taxes, levies and bills, whereas her daughter would make the payments on the loan.
The plaintiff said that they discussed who would live at the property and that it was discussed that the plaintiff would live in the premises until she passed on. The plaintiff said she asked her daughter if she would like to live there with her, but her daughter said she had too much of her own stuff, therefore she would stay at Paralowie[15].
[15] See transcript page 46.
The plaintiff said she never discussed with her daughter where the money to pay for the property was coming from, nor if any of it was coming from her husband’s bank account. The plaintiff said she never would have agreed to transfer the property to her daughter’s name if there had not been a promise that the plaintiff could live there for the rest of her life.
The plaintiff said she had the dealings with the land agent over the purchase.
The plaintiff said she signed a statutory declaration that she was giving her money to her daughter because she was asked for it by the bank. The plaintiff said she wasn’t told why the bank needed that statutory declaration. The plaintiff said her daughter never told her that her father had lent her any money or was giving her any money to purchase the property.
The plaintiff said her daughter made a will that if anything ever were to happen to her daughter, then the house would go to the plaintiff. She said her daughter made that will at a law firm in Salisbury, with the plaintiff waiting in the waiting room while it was done.
The plaintiff said that she paid $10,000 deposit from her own account, reflected in the tendered bank books, and transferred a further $54,319.02 being the rest of the money in her account[16] into her husband Marian’s account to combine with Marian’s money to enable a single cheque of $295,000.00 to issue for the settlement.
[16] $54,319.02, per P8 and P9 showing that sum transferred on 5 December 2002.
The plaintiff said that she moved into the property and has continued to live at the Farr Street address, paying all the accounts. She said that recently the water was disconnected. She said that when she rang the Council, they advised that the bills were being forwarded to another address and had not been paid for some time. She simply paid the account and the water was re-connected.
The plaintiff said that one day she had opened a letter to her daughter that she received at Farr Street indicating that her daughter was intending to purchase a property. The plaintiff said she placed a caveat on Farr Street because she was scared that if her daughter took on a loan she would lose the Farr Street property. That caveat was dated 6 August 2004, and was drafted by her conveyancer and lodged at around that time. The plaintiff said her daughter then came to her in a rage asking her why she had put a caveat on the property, and their relationship then became very rocky.
The plaintiff went on to say that her daughter no longer lives at the Hooper Street Paralowie property. She said she discovered that in 2009 simply by receiving an excess water bill and then being told by her son that her daughter had moved out and rented the property out. The plaintiff said she went around to the property and discovered tenants there, sought legal advice and wrote to the tenants requiring possession of the property[17].
[17] See exhibits P14 and P15.
The plaintiff then received via her solicitor a letter from her daughter dated 1 July 2009, giving her 10 days to vacate Farr Street. The plaintiff gave evidence that she received an application to remove her earlier caveat, that application being dated 15 June 2009, and that she instructed her solicitor to lodge a new caveat dated 31 July 2009. That prompted an application from her daughter dated 19 October 2009 to remove the new caveat.

The plaintiff said her husband died in the early part of 2003.
The plaintiff was then cross-examined. Under cross-examination the plaintiff agreed that she owned three properties. Firstly, Sansom Street Woodville North which had been the former matrimonial home. She said that property had been vacant since 2002 when the plaintiff moved into the disputed property at Farr Street. Secondly, the plaintiff owns the property at Hooper Street, Paralowie, currently rented to tenants at $320 per week. Finally, she owns a property at Penola Street, Kilkenny which had been in joint names with her husband. She said that this was transferred to her after her husband died.
Counsel for the defendant put to the plaintiff that a transfer document transferring the Penola Street Kilkenny property to her is dated March 2003, observing that whereas her husband died, she said, on 21 March 2003, the transfer noted that stamp duty was paid on 19 March 2003. Exhibit D2 was tendered being a memorandum of transfer signed on 12 March 2003, stamped for duty on 19 March 2003 and registered on 22 January 2004. Counsel for the defendant later argued that the plaintiff’s evidence on this topic was evasive and reflected badly on her credit[18]. The plaintiff said that the Penola Street Kilkenny property was currently empty, having been so for the last 12 to 15 months.
[18] Defendant's closing outline, p.3.
The plaintiff gave evidence that there was a fourth property entirely in her deceased husband’s name at Mendez Street Paralowie, currently occupied by her son Stefan, who did not pay rent.
The plaintiff denied signing exhibit D1, a Nominee Authority document enabling the property to be transferred into her daughter’s name, saying she had never seen it nor the signature purporting to be her signature on that document. Counsel for the defendant referred the plaintiff to paragraph 12 of her affidavit of 9 November 2009, where she said “I understood in all probability I signed a letter of nomination”, but she reiterated her denial. She said she didn’t think her lawyer explained to her what a letter of nomination was and that she didn’t know if she had signed a letter of nomination. I found the plaintiff’s evidence on this topic potentially unconvincing.
The plaintiff was taken through her account of events leading up to the purchase of the Farr Street property. She said she discussed it with the defendant at Sansom Street with only the defendant present, but there was another occasion when a family friend Mr Gulyas was also present. She said that on both of those occasions the effect of the discussion was that she would live at Farr Street for her lifetime. She said Mr Gulyas was a family friend then and her partner now, and is currently living with her at Farr Street. He pays for bills, she said.
The plaintiff denied that her daughter had suggested that she live at Farr Street temporarily or for only a short period of time. In relation to the caveat lodged in 2004, which did not claim a life interest but rather asserted title on the basis of having contributed some of the purchase price, she said that she did not determine the wording of that document, rather that her conveyancer did.
She agreed that she wrote a letter to her daughter in 2004. She had gone to the premises at Hooper Street Paralowie after ringing half a dozen times. She opened the gate, and knocked on the door but her daughter would not come to the door, whereupon she kicked the door. She agreed her daughter had called the police and she was removed from the property. She said she was upset with her daughter on that occasion and agreed that her daughter had said through the door that she was scared of her. She denied her behaviour was erratic and said that when she used the term “scitzo” on page 5 of her letter she only meant to say by that that her nerves were controlling her. The letter was tendered as D4.
In further cross-examination the plaintiff agreed that her daughter took her husband to a doctor when needed. She said he was diagnosed with illness 18 months before he died.
The plaintiff denied the suggestion that she ever went to her daughter’s work to ask her to sign a document transferring Farr Street to her, or that on such an occasion her daughter had asked her to get out of her car.
Whilst I have not mentioned them all, I have regard to all the matters raised by the defendant’s counsel with the plaintiff in cross-examination. The plaintiff gave her evidence in a relatively straightforward way, with some degree of consistency.
The plaintiff then called Mr Gulyas. He gave evidence that in 2002 he was a family friend but was now Ms Kozlowski’s partner, living with her for the last two to two and a half years.
Mr Gulyas gave evidence that he recalled the purchase of Farr Street being discussed between the plaintiff and the defendant. He said that the discussion was that the plaintiff would purchase the house at Farr Street where she could live in peace because she had a lot of memories of her husband in her then current house. He said the plaintiff and defendant agreed that it would be purchased in the defendant’s name but that the plaintiff would live in the house for the rest of her life. He said he was present for the two discussions on that topic, the first in Sansom Street and the second at Farr Street. This was not consistent with the plaintiff’s evidence, who said Mr Gulyas was only present for one of those meetings.
Mr Gulyas was cross-examined about the properties and these events. He recalled the Hooper Street Paralowie property being vacant for about two years, when he then assisted the defendant to move from Greenacres into that property. He said he never interfered in the family discussions, he just listened. He said that he currently pays bills and for food, but no rent.
Mr Gulyas also gave evidence in a relatively straightforward way although, as mentioned, there was inconsistency with the plaintiff on the topic of how many meetings he was present for.
The plaintiff also called Ms Ashley, who was the Australian Central Credit Union branch manager at Kilkenny in 2002. Ms Ashley said she remembered the plaintiff as a customer. She produced a loan file relating to the purchase of Farr Street. Ms Ashley gave evidence that the bank had a loans check list which needed completion. This checklist included a requirement for a statutory declaration where some of the purchase monies were a gift.
Ms Ashley gave evidence that where purchase monies were said to be a gift as in this case when funds were said to be coming from a parent, the Credit Union needed assurance that this was the case and that the monies were not repayable. A statutory declaration by the plaintiff dated 6 October 2002 was tendered. It reads as follows;
‘I Maria Kozlowski do solemnly and sincerely declare that I will be giving my daughter $305,000.00 for her to purchase a property at Woodville North. I do not require these funds back I am gifting her this money (SWORN)’
She said the bank’s requirements were that the person giving the gift had to provide the statutory declaration. Ms Ashley said that there was no suggestion in her file that any of the monies were from Marian Kozlowski.
Under cross-examination Ms Ashley said that whilst the schedule in the contract for the sale of the property included the purchaser “or nominee”, they didn’t have a copy of any document on file nominating the true purchaser. She said it is likely they never had one, given that she could not locate one on file.
Subject to the issue of the production of the conveyancer’s file, the plaintiff closed it’s case.
The defendant Julie Kozlowski gave evidence.
By way of background, the defendant said that she had stopped working in November 2010 prior to the birth of her daughter. She said that previously to that she had worked four to five years as an aged care assistant, and previously to that as a process worker at Quality Plastics.
The defendant said she currently lives with her partner Dean in Burton, in a property owned by her partner. The defendant gave evidence that she owned the Farr Street property in question but no other property. She said her parents separated in 1982 when she was aged seven, with her father leaving the Sansom Street matrimonial home. The defendant said that she and her brother stayed with her mother and that she the defendant moved out finally in 1994, aged 19. She said prior to that she had moved out once for a week.
The defendant gave evidence that after she moved out she lived in Salisbury for two years whilst unemployed. She then moved to Greenacres, closer to her then workplace Quality Plastics. She said she lived at Greenacres for two years. The defendant said that she then moved into Hooper Street Paralowie, a property owned by her mother. She paid no rent there. After she moved to Hooper Street she said she had contact with her father. She began seeing him regularly and became quite close to him. He lived at Penola Street Kilkenny.
The defendant said she cared for her father, attending his home and taking him to weekly appointments with the doctor beginning in 2002. The defendant said her father had told her that he had bought a property for her brother at Paralowie and that he also wanted to do the same for her. She said they spoke of his finances. The defendant said that her father died in 2003, having been diagnosed with schizophrenia.
The defendant gave evidence that she discussed with her mother the proposal to buy a property for her. She said that she discussed with her mother that there would be a property brought for her that would be bought and placed in her name. She said it was part of those discussions that the property would be purchased with money from her father. She said that her mother had showed her her father’s bank book which showed $295,000.00.
The defendant was then shown her own bank account for the month of December 2002 indicating a credit entry on 5 December 2002 for $295,000.00, which she said she understood to be her father’s money out of his bank account to be placed on the property at Farr Street for the purchase.
The defendant said that she had become aware of the Farr Street property when her mother had seen it and she went with her mother to see the property. The defendant said she negotiated the price herself over the telephone with the land agent prior to its purchase. She said she then attended the bank to borrow money to complete the purchase, believing it was $20,000 to $25,000 to begin with, but that it did increase. She said she made an application and received the First Home Owner’s Grant of $7,000 paid into her Credit Union account on 6 December 2002. She said therefore that at the time in 2002 she understood the purchase money to have come from her father’s account, with the rest of it being the loan she had secured from the financial institution.
She then said that she was now aware that her mother had paid the sum of $10,000 deposit, but she was not aware of it at the time. She said she only became aware of her mother paying the deposit during these court proceedings.
The defendant said that when her mother showed her the property, her mother told her it would be a good property to buy and that it was agreed that her mother could live in it on a temporary basis because she was living in unsanitary conditions in Sansom Street. She said the agreement was that her mother would take on the bills associated with the property and that she, the defendant, would pay the mortgage.
The defendant was referred to one of the of the pro-forma questions on the Home Owner’s Grant application requiring the applicant to indicate she intended to live in the property within 12 months, to which she answered yes, and said she would not have agreed to that if she had not been intending to move into Farr Street.
The defendant said that she and her mother signed the Nominee Authority document tendered as D1.
The defendant denied that Mr Gulyas had been present during any discussions between her and her mother concerning the Farr Street property, and said that she believed that her mother and Mr Gulyas were entering into an inappropriate relationship in 2002. The defendant said that her mother attended her work place in 2004, and entered her vehicle wanting the defendant to sign a piece of paper relating to the Farr Street property. The defendant said that the meeting ended by the defendant firmly asking her mother to leave the vehicle and throwing the piece of paper out of the vehicle.
The defendant gave evidence about another occasion at Hooper Street Paralowie in 2004 when her mother came and delivered the handwritten letter D4, became aggressive and the defendant had to call the police to get her mother to leave. The defendant said that she thought her mother was there trying to kick her out of the Hooper Street property. She said she thought that because of threats that had occurred before that evening.
The defendant said she wanted to purchase another property in 2004 but discovered that she could not use Farr Street as security as her mother had lodged a caveat on the property. The defendant said that she didn’t try and have that caveat removed at the time because of her mother’s erratic behaviour and because she was living in her mother’s property. The defendant said that in 2009 she took action to remove the caveat as she had moved out of the Hooper Street property into her partner Dean’s property, so she felt safe to start proceedings. She said her mother then lodged a further caveat claiming a life interest in the property. The defendant denied her mother had ever discussed the issue of staying there for her lifetime.
During the course of the defendant’s evidence, it was agreed that Marian Kozlowski died on or about 22 March 2003[19].
[19] See transcript page 125.
In cross-examination the defendant agreed that there had been violence between Marian Kozlowski and the plaintiff during their married relationship and agreed that it was not an option for the plaintiff to move into the Penola Street address in 2002, nor was it an option for the plaintiff to move into the Mendez Street Paralowie address owned by Marian Kozlowski because at that time son Stefan was there and the plaintiff was not on good terms with Stefan. There was also, she said, no room. The other property was Sansom Street the former matrimonial home.
The defendant said that she was working at Quality Plastics in 2002. She said that at that time her relationship with her mother was tolerable. Initially she gave evidence she was earning roughly $600 per week after tax. Referring to payroll entries put to her in the amount of $439, she said it fluctuated with shift work. She agreed she could not have bought real estate in 2002 without financial assistance. The defendant agreed she did not make any enquiries with any financial institutions at the time, as she would not have had the deposit on her own accord.
In cross-examination the defendant said that the Mendez Street property was still currently registered in her father’s name pending her application for letters of administration to administer her father’s estate. She agreed that brother Stefan had caveated that property, agreeing that in her view he was entitled to that property.
The defendant agreed that when she left home originally she was not on good terms with her mother, but they began talking again around about the time she moved into the Hooper Street property after her mother had offered it to her without the need to pay rent. There was some disagreement about when that was, whether it was 1995 or 1998.
The defendant was asked about the negotiations to purchase the Farr Street property. She agreed her mother had taken her to see the property, but reiterated that she negotiated and finalised the price with the real estate agent herself, after which her mother had most of the dealings with the agent. She said she was not asked to go in and sign documents, and said that all she believed she needed to do was to put money into the account of the previous owners and that that was all that needed to be done. She said she believed her mother had taken over at that time because she had asked for her mother’s assistance and that all she was told by the real estate agent was to go to her bank and organise a loan. She said the agent did not tell her that a deposit was needed nor prepare a contract in her name. She said her mother had taken it upon herself to continue with the rest of the arrangements.
She said that notwithstanding that she negotiated the deal, that the agent did not tell her that a deposit needed to be paid. She said her mother signed a contract and paid the deposit without telling her. She denied that her mother suggested the property be transferred into the defendant’s name to give her security for the future and so that her brother Stefan would not be able to make a claim on it. She said her brother didn’t have a greedy nature and had a property himself at the time.
The defendant repeated that her mother had showed her her father’s bank account and that as at the date of signing the contract of 7 October 2002, she believed that $295,000.00 was in it. She then agreed that she had not looked at her father’s bank account until these legal proceedings commenced. She said that back in 2002 she had not seen her father’s bank account, but she knew there was money in there, she said her father was aware that the money was in there but unaware of how much because her mother would refuse to give the account to him.
The defendant then said that when she viewed the account, she was sure it was $295,000.00 when she showed her. She again then agreed that she had not seen her father’s bank account until the proceedings were instituted.
This evidence was potentially confusing and inconsistent.
At one point the defendant seemed to be suggesting that her mother had showed her the $295,000.00 in her father’s bank account, but on other occasions she seemed to be denying that she had seen her father’s bank account at all until these proceedings commenced.
The defendant agreed she knew the property was to be transferred into her name but that was not because her mother had suggested it but rather because her father had. She repeated that her father wanted her to commit to a property as her brother had also, but he didn’t know how much money was in his account because he did not have control and her mother would not hand over the bank book. She said “Probably there was an agreement between me and Marian, because it was between my father and I”[20].
[20] See transcript page 138.
Various correspondence was put to the defendant indicating that the plaintiff was to be the purchaser and the defendant replied that she believed the conveyancer had known that she was the nominee but she did not believe the LJ Hooker agent was aware of it because her mother had been dealing with LJ Hooker.
The defendant repeated that in her discussions with her father he didn’t tell her how much he would gift her because he was unaware of how much he had in light of her mother’s refusal to return the bank book. She said her father told her on regular occasions that there was money in the account and asked the defendant to retrieve the bank book from her mother, which was regularly refused. The defendant agreed that her mother signed the 2002 declaration saying that she was the one gifting the $305,000.00. Counsel for the plaintiff suggested that her agreement to such a declaration was inconsistent with her claim in these proceedings that her father gave her the money. The defendant said she didn’t suggest any different at that time because her mother was intimidating and controlling.
The defendant then admitted she signed an affidavit on 25 November 2009 saying she had received the $295,000.00 as a gift from her mother, explaining the apparent inconsistency of this with her current position variously, including that she wasn’t directed correctly as she didn’t have a solicitor[21]. She also said she had been guided by the statutory declaration of her mother saying her mother had given $305,000.00, and by seeing the bank book containing the $295,000.00[22]. The defendant also agreed that the contents of her affidavit addressing the $10,000 deposit to LJ Hooker were wrong[23].
[21] See transcript page 150.
[22] See transcript pages 150-151.
[23] See transcript page 152.

The defendant agreed she made a will in 2002 leaving the property at Farr Street to the plaintiff[24]. She denied that it reflected an intention that the plaintiff be entitled to remain in the property until her death. The defendant agreed that she did not ask her mother to move out of the property until 2009, but denied that was because she had earlier agreed to let her stay there for life. She said it was because her mother was aggressively controlling and intimidating. She was referred to her First Home Owner’s Grant application indicating she was going to live in the property within 12 months of November 2002, and asked why she didn’t ask her mother to leave. She said;
AI had asked her if I could move in - I didn’t ask her that quickly in 2003 because she had only just moved in in November 2002, and there was a lot of cleaning to be done at Sansom Street, and I asked her if I could move in and she refused.
[24] See exhibit P24, tendered at transcript page 153.
The defendant was then referred to paragraph 10 of her 2010 affidavit which appeared to infer that she only decided to move into 3A Farr Street in 2004, to which she replied she wanted to do so in 2003 and 2004, adding that her mother stole her keys to 3A Farr Street in 2004.
She agreed that she did not claim in her 2009 affidavit that her father gave her the money. Her reason was “I was going by the direction of the stat declaration. I wasn’t guided by a lawyer at that time”[25].
[25] See transcript page 168.
The defendant was referred to the defence filed in the matter, agreeing it was prepared on her instructions and that she read it carefully before it was filed. She was taken to paragraphs 10.2 and 10.3. They read;
10.2 The Defendant had discussed with her father about purchasing the Property for herself.
10.3 The Defendant’s father had promised to unconditionally gift to the Defendant the sum of $305,000.00 in order to assist her to purchase the Property.
This pleading is plainly different to the defendant’s evidence at trial. Her explanation was[26];
AHe had promised to assist me with his finances. I added that number as I knew what the amount was in his bank book at this stage, which was incorrect it was 295.
QIt wasn’t even 295, I put it to you it was only about 240.
AWhen I seen it was 295.
[26] See transcript page 169.
So it seems that the defendant was saying that because she saw her father’s bank book at some stage, and then he had promised to assist her with his finances, she instructed her lawyers to claim that her father had specifically promised to unconditionally gift her the sum of $305,000.00 in order to purchase this property.
I found these answers, and her answers generally on this topic to be less than convincing. It had the distinct ring of someone piecing together an asserted agreement with her father well after the event from some of the documents. A detailed analysis of all the documents indicates that there could hardly have been an agreement by her father to gift the defendant $305,000.00 as he did not possess anything like that sum.
The defendant gave various explanations for the inconsistencies between the pleadings, her affidavit and her evidence at trial, including (at page 171);
AIt was my mistake to go by the guidance of a friend at that stage because I hadn’t known how to deal with any of these matters before as I had never been in court.
QYou agree that the version of events has changed between your defence and your earlier affidavit.
AYes, I admit that, that the affidavits have changed, yes.
QI put it to you that it had changed because you thought that it suited you to say that the money had come from Marian and not Maria.
AIt came from Marian because it was his account and his signatures. I was directed incorrectly by a friend that thought that was best for me to do it that way. Even though there is no excuse, that is what happened.
It is obviously concerning that a person might sign a knowingly incorrect affidavit on oath simply because a friend thinks it is best for them to do so. The obvious question is whether such person might be giving their evidence to the court based on what they think is best for them rather than based on the truth of the matter. The defendant’s evidence on this topic seriously affected her overall credibility.
When paragraph 13 of the statement of claim which pled her father unconditionally gifted her $295,000 on 5 December 2002 was put to her she then said she told her father how much money was in his bank book. This was inconsistent with the thrust of most of her previous evidence which was to the effect that her father never knew what was in his account as the plaintiff would never hand over the bank book.
The defendant then said that from 2003 to 2006 the plaintiff was making threats to her at the property and over the phone to get out of the Hooper Street property[27]. She agreed that she tenanted her mother’s Hooper Street property without telling her, knowing that she had no legal right to do so[28].
[27] See transcript page 177.
[28] See transcript page 187.
The defendant agreed that she asked the plaintiff to open mail that was bills, including electricity and water accounts. She agreed that in 2010 she arranged for the water account to come directly to her but then did not pay it. She denied this was so that her mother’s water would be cut off. I find it highly unlikely that the defendant would go to all the trouble of re-routing the water account to herself for the reason she gave, of being concerned that the bills were not being paid such as to effect her credit rating, but simply then be unable to pay due to her pregnancy, and not pay. It is in my view far more likely that it was done in a clumsy attempt to have the water cut off and force her mother to leave the property. This and her denials of it further adversely affect the defendant’s credit.
A Residential Tenancies Act ruling in relation to the Hooper Street property was put to Ms Kozlowski and she agreed that in that hearing she said she moved into the premises in 1999 under an arrangement with her father rather than her mother. Ms Kozlowski said that she said that incorrectly but said it because she felt secure moving into the property because it was in her father’s name. She said at page 198;
AI have no excuses for what I said incorrectly, but it was a very stressful time due to my mother’s behaviour.
In the final analysis, I was very unimpressed with the defendant’s evidence.
Assessment of witnesses
I have closely considered the evidence given by both the plaintiff and the defendant and the other witnesses in the matter. It is clear the property was purchased with a combination of the plaintiff’s money, Marian Kozlowski’s money and a small mortgage taken out by the defendant, with the plaintiff moving in and occupying the property. There is however fundamental disagreement between the parties on the crucial issue in this case of whether when the Farr Street property was purchased there was an agreement that the plaintiff could live there for the rest of her life.
The plaintiff said there was such an agreement. The defendant flatly denied any such agreement.
Ultimately, the plaintiff presented as a more convincing witness than the defendant. She gave evidence in a clear and a matter of fact way. Her evidence had a logical and straightforward quality to it. There were a couple of matters that gave me cause to closely scrutinise her evidence, in particular her denial of signing the nominee form. Overall however, she gave evidence well.
Mr Gulyas gave evidence to corroborate the plaintiff’s claim that there was an agreement that the plaintiff live in the property for life. Mr Gulyas was fundamentally inconsistent with the plaintiff on an important issue, that of whether he was present on one or both of the alleged conversations. He said he was present at both meetings whereas the plaintiff was adamant that he was only present at one.
In the final analysis, that inconsistency causes me to discount Mr Gulyas’ evidence. I concluded he was giving evidence as a loyal partner rather than on the basis of any real recollection of such discussions.
The defendant was a very unimpressive witness. Her evidence was riddled with inconsistencies. Such matters ranged from small issues such as what her earnings were per week in 2002, through to fundamental inconsistencies between the evidence she gave to this court, the affidavit she filed in 2009 and the pleadings in the matter. These inconsistencies went to the root of what she claimed she agreed with her father and her mother about the Farr Street property and the monies being provided to purchase it. I have referred to the more significant of those inconsistencies earlier in these reasons, in the course of my discussion of her evidence.
Other aspects of her evidence simply did not ring true. For example she gave evidence that she negotiated the deal with the real estate agent to purchase Farr Street, including agreeing on a price with him, but that there was no consequential discussion with the agent about the need to sign a contract or provide a deposit. It is simply unbelievable that a person would negotiate and finalise a deal to purchase a house and have no discussion with the agent about those things. She also said she had no idea that a contract needed to be signed to buy a property, but rather that all she needed to do was subsequently put money into an account.
The defendant’s explanations of the inconsistencies between her pleadings, her affidavit and her evidence in court further damaged her credit. I have referred to those explanations earlier in these reasons. When a witness says that they have executed a knowingly wrong affidavit on the basis of a friend’s advice, their credit is fundamentally affected.
I have also considered the overall likelihood and unlikelihood of the evidence given by the plaintiff and the defendant. Whilst I am cognizant of the fact that they are mother and daughter I find it unlikely that the plaintiff would have contributed $64,319.00 of her own money, together with $240,680.98 of her former husband’s money which she seemed to effectively control, and moved into the property, without securing the agreement that she said she secured. It is quite likely that the defendant would have agreed to such a proposition given that she was obtaining a house for the outlay of only a small mortgage, living as she then was rent-free on an ongoing basis in another of her mother’s houses.
I have also carefully considered all of the matters helpfully submitted by counsel orally and in writing relevant to credit and the factual dispute.
In the final analysis I found the plaintiff to be a far more credible and convincing witness, and I accept her evidence as to the events of 2002 and as to the disputed agreement.
Factual Findings
Accordingly I find that at the time of entering into the contract for the purchase of Farr Street Woodville North and subsequently, the plaintiff wanted her daughter to have the security of owning the Farr Street property in the long term and was indeed worried that her son might otherwise try and obtain the property down the track. I find that the plaintiff discussed with her daughter who would live at the property and that it was discussed that the plaintiff would live in the premises until she passed on. I find that the plaintiff also asked her daughter if she would like to live there as well, and as such it was contemplated between them that both of them might live there but that her daughter decided not to do so at the time. It was agreed that the plaintiff would pay all the bills and that the defendant would pay the small mortgage required.
I find that the plaintiff and the defendant agreed that the plaintiff be entitled to live in the property for the remainder of her life.
I also find that such agreement was part performed by the plaintiff contributing part of the purchase price, arranging the purchase, moving in and paying the bills. Further, in contributing part of the purchase price from her own funds she acted to her detriment, and insofar as it may be necessary for the plaintiff to rely on estoppel, the defendant is estopped from rejecting or denying the agreement[29].
[29] See Regent v Millett (1976) 133 CLR 679 per Gibbs J at 682-683.
Life estate or personal right to reside?
I have closely analysed the discussion that I have found took place between the plaintiff and the defendant whereby it was agreed that the plaintiff could live in the property for the rest of her life. That evidence is primarily set out at page 46 of the transcript, and summarised earlier in these reasons. The agreement was that the plaintiff could as she put it “live there until I pass on”. Significantly, the discussion also contemplated the defendant living there as well.
I find that what was intended by the parties was that the plaintiff have a right to reside at the premises for the rest of her life. From the words used, I do not find in all the circumstances that it was intended or agreed that she have a right of disposition of that property her whole life, whether to rent out or otherwise deal with it short of sale. Rather, I find that the agreement was that she have a right to live in the premises for her lifetime.
The parties did not fully address the specific orders if any that would be appropriate in that event. I will therefore hear the parties as to that and the issue of costs.