Marchesi v Apostolou

Case [2007] FCA 986

FEDERAL COURT OF AUSTRALIA

Marchesi v Apostolou [2007] FCA 986

BANKRUPTCY – Torrens system land registered in name of bankrupt – Whether bankrupt had made effective gift of land – Whether bankrupt held beneficial title to land.

EQUITY – Gift of Torrens system land – Registered title not transferred – Instrument of transfer held by solicitor acting for donor and donee – Whether instrument had been delivered to donee – Whether donor had done everything necessary to be done by him to transfer registered title – Whether gift perfect in equity.

EQUITY – Torrens system land – Agreement by registered proprietor to transfer equitable interest for value – Full price not paid by other party to agreement – Agreement not complied with in other respects – Whether agreement specifically enforceable – Whether agreement gave rise to option – Whether other party acquired equitable interest in land as a result of agreement.

BANKRUPTCY – Gift of Torrens system land to registered proprietor’s family trust – Whether purpose was to defeat creditors – Bankruptcy Act 1966 (Cth), s 121.

BANKRUPTCY – Torrens system land – Agreement by registered proprietor to transfer equitable interest for value – Whether purpose was to defeat creditors – Bankruptcy Act 1966 (Cth), s 121.

TRUSTEES – Land held on trust – Expenses and outgoings relating to land – Trustee incurring expenses incidental to proposed development of land but not in capacity of trustee – Whether trustee entitled to indemnity from trust estate.   

Bankruptcy Act 1966 (Cth)
Income Tax Assessment Act 1936 (Cth)

Transfer of Land Act 1958 (Vic)

Australian Hardwoods Pty Ltd v Commissioner for Railways [1961] 1 WLR 425
Bahr v Nicolay [No 2] (1988) 164 CLR 604
Barba v Gas & Fuel Corporation of Victoria (1976) 136 CLR 120
Beneficial Finance Corporation Ltd v Multiplex Constructions Pty Ltd (1995) 36 NSWLR 510
Brown v Heffer (1967) 116 CLR 344
Brunker v Perpetual Trustee Co Ltd (1937) 57 CLR 555
Chang v Registrar of Titles (1976) 137 CLR 177
Commissioner of Taxes (Qld) v Camphin (1937) 57 CLR 127
Corin v Patton (1990) 169 CLR 540
Costin v Costin (1997) 7 BPR 15,167
Freeman v Pope (1870) LR 5 Ch App 538
Griffith v Pelton [1958] Ch 205
In re Button’s Lease; Inman v Button [1964] Ch 263
Legione v Hateley (1983) 152 CLR 406
London and South Western Railway Co v Gomm (1882) 20 Ch D 562
Milroy v Lord (1862) 4 De G F & J 264
Nolan v Collie (2003) 7 VR 287
RWG Management Ltd v Commissioner for Corporate Affairs [1985] VR 385
Sainsbury PLC v O’Connor (Inspector of Taxes) [1991] 1 WLR 963
Sandell v Porter (1966) 115 CLR 666
Stern v McArthur (1988) 165 CLR 489
Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315
Vasiliou v Marchesi [2006] FCAFC 197

Wright v Dean [1948] Ch 686

BRENDAN JOHN MARCHESI AS TRUSTEE OF THE BANKRUPT ESTATE OF ANDREW VASILIOU, A BANKRUPT v VASILIKI APOSTOLOU AS TRUSTEE OF THE…

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AGLC
Marchesi v Apostolou [2007] FCA 986
Case
[2007] FCA 986
Decision Date

CaseChat Overview and Summary

Marchesi v Apostolou is a case that has undergone two trials, with the most recent presided over by the Federal Court. The dispute revolves around three properties, specifically, a block of residential apartments at 10 Claremont Street, South Yarra, light commercial or retail premises at 18 St Kilda Road, St Kilda, and a residential unit at 5/3 Alfriston Street, Elwood, all originally purchased by Mr Vasiliou. The applicant, Marchesi, seeks to determine the ownership and rights over these properties, which have been subject to various claims and disputes. The respondents, Apostolou, contest these claims, leading to the necessity for the court to decide on the validity of these claims and the rightful ownership of the properties in question.

The central legal issues in this case concern the interpretation of the affidavits and documents presented by both parties, as well as the application of property law principles to determine ownership and rights over the specified properties. The court had to assess the credibility and weight of the evidence provided, including the timing of property purchases, the financing of these purchases, and the use of the properties by the parties involved. Furthermore, the court needed to consider whether there were any agreements or understandings between the parties that could affect the ownership and rights over the properties.

In reaching its decision, the court thoroughly examined the affidavits and documentary evidence, noting the substantial time interval between some of the affidavits, which was due to the retrial ordered by the Full Court. The court evaluated the credibility of the evidence presented by both parties and considered the applicable property law principles. The court found that the applicant's claims were not substantiated by the evidence, and thus, the applicant's case did not succeed. The court's decision was based on the lack of clear and convincing evidence to support the applicant's claims over the properties in dispute.

The final orders of the court reflect its determination that the applicant's claims were unsuccessful. The court dismissed the applicant's case and ordered that the respondent be awarded costs associated with the proceeding. This outcome underscores the importance of clear and compelling evidence in property disputes and reaffirms the need for parties to substantiate their claims with credible documentation and testimony.

Orders

Orders of the court

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Background

Background to the litigation

This is the second time there has been a trial of this proceeding. The first trial ran before Weinberg J in April 2006. His Honour gave judgment for the applicant, but, in December 2006, a Full Court ordered a retrial: Vasiliou v Marchesi [2006] FCAFC 197. At the retrial before me, both the applicant and the respondents re-read the affidavits upon which they had relied before Weinberg J, in addition to which they read further affidavits. I mention this historical circumstance now because it explains what might otherwise be thought curious, namely, the substantial time interval between the dates of some of the affidavits referred to in these reasons. THE FACTS IN OUTLINE The case proceeded by affidavit, without pleadings. The applicant’s evidentiary case in particular relied substantially on documents. The three properties with which this proceeding is concerned (“the subject properties”) are the following:(a)A block of four residential apartments at 10 Claremont Street, South Yarra (Volume 1173 Folio 541), purchased by Mr Vasiliou in 1976.(b)Light commercial or retail premises at 18 St Kilda Road, St Kilda (Volume 4509 Folio 646 and Volume 10088 Folio 011), purchased by Mr Vasiliou in 1979.(c)A residential unit at 5/3 Alfriston Street, Elwood (Volume 9012 Folios 077, 083 and 092), purchased by Mr Vasiliou in 1984. There are two other properties which became relevant in this proceeding. The first was a house at 50 Great Valley Road, Camberwell, which Mr Vasiliou purchased in 1977. That purchase was financed by a loan from The National Bank of Australasia Ltd, which loan was in turn secured by a mortgage dated 18 November 1977. The second was a property at 181-185 St Kilda Road, St Kilda, which one of Mr Vasiliou’s companies bought at public auction some time before 1987. The actual timing of that purchase was not revealed, but Mr Vasiliou said that the property had been fully paid for by 1987. In the 1970’s, Mr Vasiliou and Ms Apostolou lived together at the unit in Alfriston Street, which they then rented. At some point – the timing of which was unclear – Mr Vasiliou commenced his own photography business in which he would take photographs (at weddings, for example) and perform the subsequent operations of development and the like. At first, Mr Vasiliou conducted this business from the unit in Alfriston Street. After a time, he found the unit too small for his needs, and he considered building a small factory behind the apartments at Claremont Street for the purpose. However, ultimately he decided to purchase separate premises, and purchased those at 18 St Kilda Road. By 1987, the position was, then, as follows. Mr Vasiliou owned two properties from which he received rent: 10 Claremont Street and 50 Great Valley Road. He owned a property which he used for his photography business: 18 St Kilda Road. He owned a property in which he and Ms Apostolou lived, and which he also continued to use for some aspects of his photography business: 5/3 Alfriston Street. And his company owned the land at 181-185 St Kilda Road (the actual use of which was not explained).

Evidence

Evidence Before The Court

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Decision

Reasons for decision

JESSUP J

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Ratio Decidendi

Legal Principle Established

Established by: JESSUP J

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