Phillips v Price

Case [2007] WASC 54

PHILLIPS -v- PRICE [2007] WASC 54



SUPREME COURT OF WESTERN AUSTRALIACitation No:[2007] WASC 54
Case No:CIV:1825/20055 FEBRUARY 2007
Coram:HASLUCK J11/03/07
34Judgment Part:1 of 1
Result: Judgment for plaintiff
Plaintiff entitled to declaratory relief
B
PDF Version
Parties:STEPHEN PHILLIPS
JOHN ERNEST PRICE

Catchwords:
Trusts and trustees
Claim that shares held on resulting or constructive trust
Nature of relief in equity available
Whether claimant entitled to relief depends upon intention of parties
Whether titleholder acting unconscionably
Absence of any enforceable agreement bearing upon the intention of the parties
Finding that parties did not finalise exact basis upon which funds were to be employed or in which the shares were to be utilised
Presumption that purchaser of shares did not intend agent to take beneficially
Plaintiff entitled to call for transfer of title to property of which he was the beneficial owner
No basis for defendant to refuse or fail to comply with request for transfer of subject shares
Plaintiff entitled to declaratory relief as sought
Turns on own facts

Legislation:
Corporations Act 2001 (Cth), s 9, s 201M(1)

Case References:
Calverley v Green (1984) 155 CLR 242
Ermogenous v Greek Orthodox Community of SA Inc (2002) 209 CLR 95
Gosper v Sawyer (1985) 160 CLR 548
Hunter v Hunter [1938] NZLR 520
Muschinski v Dodds (1985) 160 CLR 583
Nelson v Nelson (1995) 184 CLR 538
Smolarek & Anor v Liwszyc & Ors (2006) 32 WAR 101
Sorna Pty Ltd v Flint (2000) 21 WAR 563
Taylor v Johnson (1983) 151 CLR 422

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
    IN CIVIL
CITATION : PHILLIPS -v- PRICE [2007] WASC 54 CORAM : HASLUCK J HEARD : 5 FEBRUARY 2007 DELIVERED : 12 MARCH 2007 FILE NO/S : CIV 1825 of 2005 BETWEEN : STEPHEN PHILLIPS
    Plaintiff

    AND

    JOHN ERNEST PRICE
    Defendant

Catchwords:

Trusts and trustees - Claim that shares held on resulting or constructive trust - Nature of relief in equity available - Whether claimant entitled to relief depends upon intention of parties - Whether titleholder acting unconscionably - Absence of any enforceable agreement bearing upon the intention of the parties - Finding that parties did not finalise exact basis upon which funds were to be employed or in which the shares were to be utilised - Presumption that purchaser of shares did not intend agent to take beneficially - Plaintiff entitled to call for transfer of title to property of which he was the beneficial owner - No basis for defendant to refuse or fail to comply with request for transfer of subject shares - Plaintiff entitled to declaratory relief as sought - Turns on own facts

Legislation:

Corporations Act 2001 (Cth), s 9, s 201M(1)


(Page 2)



Result:

Judgment for plaintiff


Plaintiff entitled to declaratory relief

Category: B


Representation:

Counsel:


    Plaintiff : Mr P A Tottle
    Defendant : No appearance

Solicitors:

    Plaintiff : Tottle Partners
    Defendant : No appearance



Case(s) referred to in judgment(s):

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AGLC
Phillips v Price [2007] WASC 54
Case
[2007] WASC 54
Decision Date

CaseChat Overview and Summary

In the matter of Phillips v Price, the plaintiff sought a declaration that shares in a company held by the defendant were held on trust for him. The dispute arose from an investment in a company made with funds from the plaintiff. The Federal Court of Australia was tasked with determining the nature of the trust, if any, that applied to the shares. The primary issue for the court was whether the shares were held on a resulting or constructive trust for the plaintiff, given that the defendant held legal title to them. The court needed to consider whether the plaintiff's entitlement to relief depended on the intention of the parties at the time the funds were invested and if the defendant's refusal to transfer the shares was unconscionable.

The court examined the nature of the relationship between the parties and the absence of any formal agreement regarding the investment. It found that while there was no resulting trust, the circumstances suggested a constructive trust. The court held that the absence of a finalised agreement did not preclude a finding that the shares were held on trust for the plaintiff. The court found that the plaintiff was the beneficial owner of the shares and was entitled to demand their transfer. The defendant's refusal to transfer the shares was deemed unconscionable in the absence of any legitimate reason for withholding the transfer. The court concluded that the plaintiff was entitled to the declaratory relief sought.

The court's reasoning was grounded in the principle that where a person holds legal title to property, but it is clear that they do not hold the beneficial interest, a constructive trust arises. The court found that the plaintiff's entitlement to the shares was based on equity and the nature of the relationship between the parties. The court's decision hinged on the fact that the plaintiff was the beneficial owner of the shares and that there was no justifiable reason for the defendant to withhold the transfer. The final orders of the court were that judgment was entered in favour of the plaintiff, and the plaintiff was entitled to the declaratory relief as sought.

Orders

Orders of the court

Judgment for plaintiff

Plaintiff entitled to declaratory relief

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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