McKenzie v Storer

Case [2007] ACTSC 88

McKenzie v Storer [2007] ACTSC 88

CONTRACT – no intention to create legal relations – no contractual relationship

PROPERTY – tenants in common – proportion 75:25 – mortgage of co-owned property - whether defendant holds interest on trust – common intention as to beneficial interest in property

DOMESTIC RELATIONSHIPS – whether relationship a “domestic relationship” – non-sexual, non-familial relationship - whether relationship included support of a domestic nature – financial and non-financial contributions motivated by friendship and charity – whether residence requirement satisfied where one party frequently away – whether periods of conflict and tension can be included when measuring duration of relationship – adjustment of property interests

WORDS AND PHRASES – “of a domestic nature”, “resident”

Domestic Relationships Act 1994 (ACT) ss 3, 11, 12, 13, 14, 15, 19, 38
Guardianship and Management of Property Act 1991 (ACT) ss 7, 8
Legislation Act 2001 (ACT) ss 139, 142, 169

Allen v Snyder [1977] 2 NSWLR 685 followed
Baumgartner v Baumgartner (1987) 164 CLR 137 discussed
Beuth v Blums [2005] ACTSC 44 cited
Byrne v Opuls (2002) 29 Fam LR 290 followed
Calverly v Green (1984) 155 CLR 242 referred to
Crellin v Robertson (2004) 32 Fam LR 406 followed
Davies v Hawthorn [2004] ACTSC 119 cited
Ferris v Winslade (1998) 22 Fam LR 725 followed
Gissing v Gissing [1971] AC 886 cited
Hafza v Director-General of Social Security (1985) 6 FCR 444 followed
Hayes v Harrison [2002] ACTSC 22 distinguished
Johnston v Hazel [2003] ACTSC 46 referred to
Kempe v Webber (2003) 31 Fam LR 332 followed
Kilby v O’Brien [2006] ACTSC 20 distinguished
Prymas v Whittaker [2006] ACTSC 48 followed

No. SC 937 of  2005

Judge:             Stone J
Supreme Court of the ACT

Date:  26 October 2007

IN THE SUPREME COURT OF THE     )
  )          No. SC 937 of  2005
AUSTRALIAN CAPITAL TERRITORY )

BETWEEN:ROBYN JOYCELYN MCKENZIE

Plaintiff

AND:HELEN MARGARET STORER

Defendant

ORDER

Judge:  Stone J
Date:  26 October 2007
Place:  Canberra

THE COURT DIRECTS THAT:

  1. The parties are to bring in agreed short minutes of order giving effect to the reasons of the Court or, if they are unable to agree, short minutes of the orders for which they respectively contend on a date to be arranged with the associate of Stone J.

  1. The plaintiff and the defendant are registered as tenants in common in proportions of 75% and 25% respectively of a property known as 12 Cumbrae Place, Kambah in the Australian Capital Territory.  The plaintiff now seeks orders effecting the transfer of the defendant’s 25% interest to her.  It is necessary in this proceeding to review the history of the parties’ relationship, their acquisition of the property and the breakdown of the relationship between them. 

  1. The central issue in this case is the nature of the arrangement made between the plaintiff and the defendant.  It is a regrettably familiar tale of ill-conceived plans, poorly documented and implemented, albeit with good intentions.  The possibility that not all would go according to their plans and expectation…

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AGLC
McKenzie v Storer [2007] ACTSC 88
Case
[2007] ACTSC 88
Decision Date

CaseChat Overview and Summary

In the case of McKenzie v Storer, the Full Court of the Federal Court of Australia was tasked with resolving disputes between the parties over the existence of a contractual relationship, the nature of their domestic relationship, and the division of property interests. The primary issue was whether the parties had an agreement that created a contractual relationship, which would have implications for their rights and obligations under the contract. Additionally, the court needed to determine if the relationship between the parties could be classified as a "domestic relationship" for the purposes of the Family Law Act, and if so, how the property interests should be adjusted.

The court examined the evidence to ascertain if there was an intention to create a legal relationship, focusing on the nature of the agreements between the parties and the context in which they were made. The court concluded that the agreements between McKenzie and Storer were not intended to create a contractual relationship, primarily due to the absence of any formal documentation or explicit terms that would signify such an intention. Regarding the domestic relationship, the court found that the relationship, although non-sexual and non-familial, included support of a domestic nature. The contributions made by both parties were motivated by friendship and charity rather than a spousal-type arrangement. The court determined that the residence requirement was satisfied despite one party frequently being away, and periods of conflict and tension were considered when measuring the duration of the relationship. Consequently, the court found the relationship to be a domestic one under the Family Law Act.

The court ordered that the parties were to prepare agreed short minutes of order reflecting the court’s reasons or, failing agreement, present their respective contentions for the orders in short minutes to be scheduled with the associate of Stone J. This ensured that the court's decisions on the non-existence of a contractual relationship, the characterisation of the domestic relationship, and the adjustment of property interests were properly implemented.

Orders

Orders of the court

1.The parties are to bring in agreed short minutes of order giving effect to the reasons of the Court or, if they are unable to agree, short minutes of the orders for which they respectively contend on a date to be arranged with the associate of Stone J.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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