Merker & Ors v Merker & Anor

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SUPREME COURT OF QUEENSLAND

CITATION:

Merker & Ors v Merker & Anor [2021] QSC 285

PARTIES:

TERRY DESMOND MERKER

(first plaintiff)
and
CAROLYN VERONA HASEMANN
(second plaintiff)
and
VALERIE DAWN MERKER
(third plaintiff)
and
GREGORY WAYNE MERKER
(fourth plaintiff)

v
MARILYN PATRICIA MERKER

(first defendant)
and
THE ESTATE OF ARNOLD RONALD MERKER (DECEASED)
(second defendant)

FILE NO:

BS 13095/20

DIVISION:

Trial

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court of Queensland

DELIVERED ON:

9 November 2021

DELIVERED AT:

Brisbane

HEARING DATE:

29 July 2021

JUDGE:

Dalton J

ORDERS:

1.   Dismiss the defendants’ application filed 17 June 2021.

2.   Judgment for the defendants against the plaintiffs on paragraphs 1 and 3 of the prayer for relief in the amended statement of claim.

CATCHWORDS:

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – ENDING PROCEEDINGS EARLY – SUMMARY DISPOSAL – SUMMARY JUDGMENT FOR DEFENDANT OR RESPONDENT: STAY OR DISMISSAL OF PROCEEDINGS – where the defendants applied for summary judgment under rule 293 of the Uniform Civil Procedure Rules

EQUITY – TRUSTS AND TRUSTEES – IMPLIED TRUSTS – CONSTRUCTIVE TRUSTS – COMMON INTENTION – where the plaintiffs’ parents obtained a loan to purchase a half‑share in property in 1985 – where the plaintiffs repaid the loan by monthly repayments – where the plaintiffs alleged that the half-share of the property was held pursuant to a common intention constructive trust – meaning of constructive trust – where the land was transferred to one of the children for natural love and affection in 2014 – where the plaintiffs alleged that the land was received with knowledge of the common intention constructive trust – first limb of Barnes v Addy – knowing receipt of trust property

REAL PROPERTY – TORRENS TITLE – INDEFEASIBILITY OF TITLE – EXCEPTIONS TO INDEFEASIBILITY – common law in personam exceptions to indefeasibility – Land Title Act, section 185(1)(a) – where the defendants argued that the plaintiffs’ case was bound to fail as the knowing recipient was the registered proprietor of the land – where the common law in personam exception to indefeasibility does not assist in relation to the first limb of Barnes v Addy

EQUITY – EQUITABLE REMEDIES – EQUITABLE COMPENSATION – where the plaintiffs argued that they would still have a claim for equitable compensation even though registration defeated the proprietary interest they claimed in relation to the first limb of Barnes v Addy

ESTOPPEL – ESTOPPEL BY CONDUCT – PROPRIETARY ESTOPPEL – where the plaintiffs relied on the proprietary estoppel claim to ask the Court to impose a trust over the land – where the plaintiffs alleged that the 2014 transfer of the land was inconsistent with the plaintiffs’ assumptions based on the 1985 arrangement – where the plaintiffs alleged the defendants’ silence encouraged their belief in this assumption – where the defendants did not own the land at the time the representation or assumption was made – where the plaintiffs had an expectation of ownership based on their mother’s representation, not representations by the defendants – where the…

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Details
Case
[2021] QSC 285
Decision Date

CaseChat Overview and Summary

In the case of Merker & Ors v Merker & Anor, the plaintiffs sought to establish a common intention constructive trust over a property, alleging that their parents had obtained a loan to purchase a half-share in 1985 and that the plaintiffs had subsequently repaid the loan. The plaintiffs further argued that the land was transferred to one of the children in 2014 with knowledge of this constructive trust. The defendants, including one of the children, opposed the claims on various grounds, including the in personam exception to indefeasibility, the inapplicability of equitable compensation, and the lack of a proprietary estoppel claim. The defendants also challenged the plaintiffs' amendments to their statement of claim and argued that the claims were barred by limitation periods and laches.

The primary legal issues before the court were whether the plaintiffs' common intention constructive trust claim could succeed, whether the defendants' transfer of the land was a knowing receipt of trust property, and whether the plaintiffs' delay in bringing the claims prejudiced the defendants. The court also considered whether the plaintiffs' amendments to their statement of claim should be disallowed and whether the claims were barred by limitation periods and laches.

The court found that the plaintiffs' common intention constructive trust claim failed because there was no evidence of a common intention that the plaintiffs would gain a proprietary interest in the land. The bequest to Arnold in Verona's 2005 Will, which was inconsistent with the alleged common intention, suggested that the arrangement was more likely a loan than a contribution towards a shared interest in the property. The court also found that the common law in personam exception to indefeasibility did not assist the plaintiffs in relation to the first limb of Barnes v Addy. Furthermore, the court held that the plaintiffs' claim for equitable compensation was not viable because registration defeated their proprietary interest. The court rejected the plaintiffs' proprietary estoppel claim, finding that the defendants were not trustees or fiduciaries and that the plaintiffs' expectation of ownership was based on their mother's representation, not the defendants'. The court further held that the plaintiffs' amendments to their statement of claim did not change the factual and legal basis of their case and that the delay in bringing the claims did not prejudice the defendants.

The court dismissed the defendants' application to disallow the plaintiffs' amendments to their statement of claim. However, the court granted summary judgment in favour of the defendants on the plaintiffs' claims for a common intention constructive trust and proprietary estoppel. The court found that the plaintiffs had no real prospect of succeeding on these claims and that there was no need for a trial. The court ordered that judgment be entered in favour of the defendants against the plaintiffs on the specified paragraphs of the prayer for relief in the amended statement of claim.

Orders

Orders of the court

1. Dismiss the defendants’ application filed 17 June 2021.

2. Judgment for the defendants against the plaintiffs on paragraphs 1 and 3 of the prayer for relief in the amended statement of claim.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

The last point made by the defendants as to why I should disallow the amendments to the statement of claim was that they lacked utility because the claim must fail. There is an obvious overlap here with the summary judgment application originally brought by the defendants. I prefer to deal with the viability of the plaintiffs’ claim in considering the summary judgment application.Summary Judgment Application The defendants applied for summary judgment pursuant to r 293 of the UCPR. That rule permits a defendant to obtain summary judgment if the Court is satisfied that the plaintiff has no real prospect of succeeding on all or parts of its claim – subrule 2(a) – and there is no need for a trial – subrule 2(b). Both the plaintiffs and defendants swore affidavits going to the merits of the plaintiffs’ claim. Marilyn swore that she recalled Verona wanted the Dayboro property to be kept within her family (rather than shared with Audrey), and that for that reason she and Arnold agreed to help Verona buy out Audrey’s share of the property. That is consistent with what the plaintiffs say about the 1985 arrangement. However, Marilyn denies the remainder of the arrangement as the plaintiffs plead it; she denies there was a common intention that all the children would contribute and would thereby gain a proprietary interest in the land, either immediately, or at a later time. She swears that at some date which she does not precisely recall, Verona provided her and Arnold with a copy of the 2005 Will. Although she does not directly say so, it seems from her affidavit that she knew of the 2008 lease and the option to purchase it contained. She swears that at some time, probably when the land was transferred to Arnold, she and Arnold paid Verona and Ronald the sum of $50,000 in cash. They were not provided with a receipt. She says that it was her understanding that Verona was to pay that money to the plaintiffs, but she does not know whether or not that happened. The 2005 Will is an exhibit to Marilyn’s affidavit. It refers to Arnold’s health problems and the fact that he has “paid for extensive improvements to the home”. The Will continues, “to ensure Arnold has a secure place to live in the future and to ensure that he is duly recompensed for the financial and other contributions he has made and subject to clause 6(e) of this Will I give my property at 57 McKenzie Street, Dayboro to Arnold.” Clause 6(e) of the Will contains an acknowledgment by Verona that the plaintiffs “have contributed cash to help me purchase my property. I therefore charge this bequest with the direction that Arnold pay [the plaintiffs] the sum of fifty thousand dollars ($50,000), such money to be divided equally among those children.” The acknowledgment at cl 6(e) of the Will is consistent with the alleged 1985 arrangement so far as it involves the children contributing cash to help Verona buy Audrey’s share of the property. The bequest to Arnold is inconsistent with the alleged common intention that there be a trust of the property in favour of the plaintiffs and Arnold. No doubt it bears on what the 1985 arrangement was, and also upon whether or not the bequest to Arnold was a breach of that arrangement.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.