Rossi v Rossi
[2016] VCC 353
•7 April 2016
| IN THE COUNTY COURT OF VICTORIA | Revised Not Restricted Suitable for Publication |
AT MELBOURNE
COMMERCIAL DIVISON
GENERAL LIST
Case No. CI-15-00757
| ROBERT ROSSI | Plaintiff |
| v. | |
| ROSETTA ROSSI | Defendant |
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JUDGE: | His Honour Judge Anderson | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 30 & 31 March and 1 April 2016 | |
DATE OF JUDGMENT: | 7 April 2016 | |
CASE MAY BE CITED AS: | Rossi v. Rossi | |
MEDIUM NEUTRAL CITATION: | [2016] VCC 353 | |
REASONS FOR JUDGMENT
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Catchwords: Trusts – Family home in the joint names of a husband and wife – Property sold as a result of a Family Court order – Purchased by a daughter and placed in joint names of the daughter and her mother – On the mother’s death, the property passed to the daughter by survivorship – Son claiming an interest in the property on the basis of improvements he made to the property and the care of his mother over many years.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr Robert Rossi (in person) | |
| For the Defendant | Ms Rosetta Rossi (in person) |
HIS HONOUR:
1Domenica Rossi (“Mrs Rossi”) died on 13 November 2011. She left six children including the plaintiff, Roberto Rossi (“Robert”) (now aged 44) and the defendant, Rosetta Rossi (“Rosa”) (now aged 60).
2At the time she died, Mrs Rossi was the joint owner with Rosa of the residential property at 6 Winter Crescent, Reservoir (“the Reservoir property”). Ownership of the property passed by survivorship to Rosa.
3Mrs Rossi and her husband had purchased the Reservoir property in 1968. They divorced in 1977. By order of the Family Court of Australia, the Reservoir property was to be sold and the net proceeds divided between Mr and Mrs Rossi.
4At public auction in August 1998, the Reservoir property was purchased by Mrs Rossi and Rosa for $107,750. Rosa contributed $75,337.37 to the purchase price. This sum was effectively used to pay out Mr Rossi’s half share of the net proceeds, the costs of the sale and certain outstanding debts of Mrs Rossi.
5On 8 February 1999, Mrs Rossi made a will leaving her estate to Rosa, and if she predeceased Mrs Rossi, to Rosa’s daughter Laura. When Mrs Rossi died, she did not have any significant assets apart from her joint interest in the Reservoir property. Rosa, as her mother’s executor, paid her mother’s debts but did not seek a grant of probate. The will explained the reason no provision was made for Mrs Rossi’s other five children.
6Robert is the youngest child, and with Rosa, had been the closest to their mother. Robert said that it was “common knowledge” within the family and the “understanding” between Robert, Mrs Rossi and perhaps Rosa that, after their mother died, Rosa would have her half of the Reservoir property and Robert would have Mrs Rossi’s half.
7On 6 February 2012, a caveat was lodged over the Reservoir property by solicitors on Robert’s behalf claiming “absolutely” an “equitable interest in fee simple…pursuant to a resulting, implied or constructive trust”. A writ was issued on 17 February 2015 after an appliction was made to remove the caveat pursuant to section 89A of the Transfer of Land Act 1958.
8The statement of claim recited that:
a.“Between about 1996 and 2010 the plaintiff [Robert] lived at the [Reservoir] property on and off”;
b.“The plaintiff made substantial contributions to the improvement of the property”;
c.“The plaintiff provided substantial care to the Deceased” [Mrs Rossi];
d.there was an “understanding” of which “at all relevant times the deceased and the defendant [Rosa] were aware that the plaintiff was using his own money and providing his own labour and expertise in carrying out the improvements and providing the care, in the expectation of acquiring an interest with the deceased and/or defendant as co-owner in the property”;
e.“The deceased and the defendant acquiesced in the expenditure of the plaintiff’s money and the contribution of his labour to the improvements and the care by the plaintiff, and encouraged the plaintiff to believe that he would acquire an interest with the deceased as co-owner of the properties [sic]”;
f.“the plaintiff made the said improvements and provided the said care and thereby acted to his detriment”.
9The statement of claim, signed by counsel and solicitors, sought the following relief:
a.“A declaration that the property is held by the defendant and the plaintiff as trustees pursuant to a constructive trust”;
b.an order for the sale of the property and an apportionment of the proceeds “between the plaintiff and the defendant in such proportions as the Court may direct” or alternatively, “a declaration that the plaintiff is entitled by way of equitable charge to be paid such sum from the net proceeds of sale as the Court may direct”.
10The legal basis for seeking this relief appears to be as follows:
a.the defendant breached “the understanding formed by the plaintiff, the deceased and defendant” by denying “the beneficial interest of the plaintiff in the property”;
b.the defendant should be estopped from denying “that the plaintiff is entitled to an interest with the defendant as co-owner in the property”;
c.“the defendant holds her legal estate in the property as a constructive trustee for the plaintiff for such beneficial interest as the Court may determine”;
d.“it would be unconscionable and inequitable for the defendant to retain the benefit of the plaintiff’s contribution on the improvements and the care free from any obligation to repay the money”.
11Robert and Rosa represented themselves at the hearing. There was no further articulation by Robert at the hearing of the legal basis for his claims. I have considered his entitlement according to the legal principles of contract law, proprietry estoppel, the creation of a resulting or constructive trust and the entitlement to restitutionary relief.
12Rosa’s defence is also signed by counsel and solicitors. It denies the factual basis for the relief sought and, in addition:
a.relies upon the indefeasibility of the title she and Mrs Rossi obtained by virtue of the registration of their joint proprietorship in 1998 and Rosa’s registration as the sole proprietor by survivorship after her mother’s death in 2011;
b.alleges that Robert is not entitled to equitable relief by reason of his “laches, acquiescence and delay”;
c.asserts that Robert’s claim is statute barred.
13The issues for determination in the proceeding are:
a.whether there is a factual basis for Robert’s allegations of:
i.making “substantial contributions to the improvement of the property”;
ii.providing “substantial care to the deceased”;
iii.an “understanding” of which the deceased and the defendant were aware;
iv.“acquiescence” or “encouragement” by the deceased and the defendant in the plaintiff’s expenditure of money and provision of labour;
v.him acting “to his detriment”;
b.whether there is a legal basis for:
i.a contractual claim;
ii.a proprietary estoppel claim;
iii.the creation of a resulting or constructive trust;
iv.the grant of restitutionary relief;
c.whether there is merit in defences based on:
i.the indefeasibility of the defendant (and/or the deceased’s) title;
ii.laches, acquiescence or delay;
iii.the statute of limitations.
14I have determined that Robert’s claim must fail. There is no factual basis for any of the alleged claims and, in the circumstances, the indefeasibility of the title of the defendant and the deceased as joint registered proprietors, and of the defendant as the sole registered proprietor by survivorship, would defeat the claims.
Conduct of the trial
15During the trial, certain documents which Rosa wished to tender were marked as exhibits “subject to objection”. Through my inadvertence, the admissibility of these documents was never resolved. The five relevant documents include three affidavits from the Family Court proceedings, an attachment to a further affidavit from these proceedings and a list of the expenditure incurred by Rosa on the Reservoir property since November 2011. I have determined that, in the circumstances, I should not have regard to the content of these documents.
16Robert and Rosa gave evidence. Robert also called their brothers, Giovanni (“John”) and Antonio (“Tony”), to give evidence. The oral evidence ranged over many matters, including very sensitive issues relating to the deaths of their parents. Also, and particularly because the questioning was through non-lawyers who were family members, the issues canvassed were not always focussed. The proceedings at trial were recorded but not transcribed.
17In the circumstances, I will only make findings of fact where I consider that it is necessary for an understanding of how I reached my decision. The critical areas include:
a.the improvements made to the Reservoir property by Robert and the care he provided to his mother;
b.the circumstances relating to the purchase of the Reservoir property at auction in 1998;
c.any “understanding” which existed between Robert, Rosa, the other siblings and their mother.
18I will make some specific findings of fact based upon my assessment of the witnesses. Generally, I have tried to look for objective evidence from contemporaneous documents or, where there was a conflict of oral evidence, to determine the issue on the basis of which evidence was more credible and which party bore the onus of proof on the particular issue.
Background facts
19Mrs Rossi was a strong and impressive person. Her extensive community service was honoured by the award of the Medal of the Order of Australia in 1993 “in recognition of your outstanding and distinguished service to women and to the Italian community particularly through the Reservoir Italian Women’s Group”.
20Mrs Rossi had a difficult life with her husband and children. Mr and Mrs Rossi had purchased the Reservoir property in 1968. Mrs Rossi lived in the house until her death in November 2011; about 43 years. The house was very important to Mrs Rossi. She maintained the house and garden to a high standard. The property was somewhere to which her children could always return.
21Rosa was the oldest child. She was born in 1955 and left home in 1986, aged 31. Her daughter Laura was born in 1991. Robert was the youngest child. He was born in 1972 and left home to be married in 1997, at age 25. John was born in 1957 and left home at age 16 or 17. Tony was born in 1967 and left home at age 12. The two other daughters lost touch with their mother after leaving home. Mr Rossi, as well as John and Tony, were engaged in criminal activities. John described his father as a “vagabond”, who was “old fashioned” and “chauvinistic”. John said his mother had a “hard life”, and she had “worked very hard” and raised the children. Mr Rossi “worked very little” and considered that “work was only for stupid people”.
22In April 1977, following contested Family Court proceedings, Mr and Mrs Rossi were divorced and orders were made granting Mrs Rossi custody of the youngest children, Tony and Robert, and providing for the sale of the Reservoir property. Mr and Mrs Rossi entered into an agreement in August 1977 permitting Mrs Rossi to exclusively occupy the Reservoir property until the two youngest children “leave school or are self supporting”.
23After Robert left home in 1997, there were further contested proceedings in the Family Court. In May 1998, the Court ordered that the Reservoir property be “sold forthwith”. The property was publicly auctioned on 22 August 1998.
Sale of the Reservoir property
24From the evidence at the trial it appeared that Robert and his brothers John and Tony had a fundamental misunderstanding of the circumstances of the sale of the Reservoir property. Before the sale, they understood, correctly, that their parents jointly owned the property and that as a result of the proposed sale, the proceeds were to be split between them.
25After the sale, they knew that Rosa was the joint owner with their mother. However, they, incorrectly, characterised the transaction as Rosa having purchased their father’s half share in the property. As a result, when Mrs Rossi died in 2011, they considered that the appropriate division of the Reservoir property was that the two children who had consistently maintained a close relationship with their mother, Rosa and Robert, should share the property.
26Their view appeared to be that the role of the Court was simply to determine the appropriate proportions in which Robert and Rosa should share. Robert and his brothers regarded the concept of Rosa being entitled by survivorship to the whole property upon their mother’s death as a “trick” by which Rosa has obtained an unfair advantage and to which their mother, if she had properly understood things, would never have agreed.
27It appears, that although the relevant documents relating to the sale were discovered in the proceeding, the details of the purchase of the Reservoir property in 1998 were not clear to Robert and his brothers until the trial.
28The Reservoir property was sold at auction for $107,750, with a 10% deposit and the balance to be paid in 2 months. The purchaser was Rosa’s agent and Rosa and her mother were later nominated as the joint purchasers. The purchase settled on 22 October 1998, and soon after, Rosa and her mother were registered as “joint proprietors”.
29Rosa contributed $75,337.37 towards the purchase of the Reservoir property. The sources of this sum included:
Deposit money from CBA bank account $10,775.00
Sale of TABCorp shares $4,577.95
Sale of Woolworths shares $2,775.65
Sale of CBA shares $9,410.75
Cashed in superannuation entitlement $38,388.46
Cashed in superannuation entitlement $9,509.56
$75,337.37
30At settlement, after payment of the costs and expenses of the sale and the discharge of the Housing Commission mortgage, the half share paid to Mr Rossi including his legal costs, was $51,287.22. In addition, Rosa paid the following further expenses:
Payment of Mrs Rossi’s credit card debt $1,968.00
Legal Aid costs of the Family Court proceedings $1,099.00
31Rosa said that she also repaid a loan from herself to her mother of $400 and legal expenses of $3,500. I consider, however, that it is more likely the latter sum was taken into account in calculating the half shares to which Mr and Mrs Rossi were entitled. The expenses taken into account before splitting the proceeds may have also included the payment to the Ministry of Housing to discharge the mortgage over the Reservoir property.
32It can be seen from this analysis that Rosa’s contribution to the purchase price of the property went far beyond the amount needed to pay for her father’s share of the proceeds of sale. There was some secrecy involved in the means by which Rosa acquired an interest in the property by the use of an agent who bid for her at the auction. Rosa said that this was necessary so her father remained unaware of what she proposed, as he had rejected two offers prior to the auction, for the purchase of his share of the Reservoir property.
33No one apart from Rosa contributed to the transaction which ensured that her mother was able to remain living in her own home. It seems that the three sons, including Robert, had neither the inclination nor the resources to do so. Also, they had assumed that, after the Reservoir property was sold, their mother would go to live with their oldest sister, Rosa.
34Rosa said in evidence that her mother wanted to remain on the title as an owner of the Reservoir property. Rosa said she agreed to this on the basis that her mother made a will leaving her residuary estate to Rosa, or if Rosa predeceased her mother, to Laura. Rosa said that she was concerned that if she died before her mother, the Reservoir property would pass to her mother by survivorship and her own daughter would be left unprovided for. Rosa also said, after her mother’s death, that the saving in stamp duty was also a factor in putting the Reservoir property in joint names, as the available funds were limited.
35Mrs Rossi made a will on 8 February 1999 leaving her residuary estate to Rosa or, if Rosa predeceased her, to Rosa’s daughter Laura. The will also provided as follows:
“10. I HAVE PRECLUDED my other children GRAZIETTA GARRO, GIOVANNI ROSSI, ANNA MARIA CAPITO, ANTONIO ROSSI and ROBERT ROSSI from receiving any benefit under my Will because they have been adequately provided for during my lifetime. Further GRAZIETTA GARRO and ANNA MARIA CAPITO have not made contact for over 20 years which treatment is appalling to me and while my three sons have made irregular contact, it has always been for their own financial benefit”.
36Mrs Rossi also appointed Rosa her attorney pursuant to an enduring power of attorney executed on 8 February 2001.
37In their evidence, Robert and his brothers said that they believed their mother would not have known what she was signing when she executed the will and would not have deliberately excluded her other children, particularly Robert. However, this ignores the fact that Mrs Rossi made the will through solicitors, and from 1998, until her death in late 2011, Mrs Rossi did not:
a.change her will or make a new one;
b.sever the joint tenancy;
c.revoke her power of attorney;
d.raise with her sons any unease she had with the arrangements that had been put in place in 1998.
38This was also notwithstanding the fact that between 2001 and 2011, Rosa had limited contact with her mother. Rosa said she “retreated” to look after herself. She said that she “had a nervous breakdown and got breast cancer and my teenage daughter had to look after me”. Robert said he was in regular contact with his mother during this period. Also, his brother John had, after 2007, reconciled with his mother and lived with her between April and October 2010.
Robert’s contact with his mother
39There was general agreement between the siblings that Robert had a good relationship with his mother. He was the youngest child and he had not followed his older brothers into criminal activity. Until recently, he had maintained steady employment; he suggested, at a “managerial” level.
40Robert married in 1997, although the relationship only lasted a short time. In 2001, Rosa had an argument with her mother and ceased direct contact with her. Robert said that she got angry about a $3,000 credit card bill of their mother’s and Rosa “left the house and never returned”. Rosa said that when she paid off her mother’s credit card debt in 1998, her mother promised not to lend the boys any more money. She thought that the debt in 2001 had been run up as a result of Mrs Rossi lending money to Robert. He denied this.
41In 2001, Robert sold his former matrimonial home and moved into a unit at Broadmeadows. He said that for a time he spent half of his time at Broadmedows and half of his time at the Reservoir property. He later commenced a relationship with Tracey who had three children of her own. Robert and Tracey had two sons together in 2004 and 2009.
42The frequency of Robert’s contact with his mother was unclear. He said that he spent important days – Christmas, Easter, birthdays and Mother’s Day – with his mother, usually just “me and her”. Robert said that he regularly took his mother shopping, to all medical appointments and to play bingo and the pokies. Whilst I have no doubt that Robert maintained contact with his mother, his evidence was fairly general and, I consider, prone to over-statement.
43Robert also gave evidence of his contact with Rosa and his niece Laura. He said that he had picked up Laura after school for, what he suggested was, every day for a number of years. Rosa said that the period was one year whilst she worked and Laura was in an early year at school. Probably, Robert and Laura had a special relationship and Robert helped Rosa out during the period she was working. Beyond that, I do not consider that Robert’s evidence was necessarily reliable on this and other matters.
44I will examine Robert’s claims to have performed works at the Reservoir property and to have regularly cared for his mother, particularly in her later years. I have no doubt that Robert did provide some assistance with household tasks and some care and support, but again the objective evidence suggests that Robert has exaggerated these matters in his evidence.
Improvements by Robert to the Reservoir property
45The statement of claim details the provision of certain goods and services by way of “improvement of the property”. Robert conceded that the items referred to had largely been provided prior to 1998. In respect of the nine items listed, no documents were produced supporting the performance of the work and the description of the work was usually in very general terms without reference to dates or cost.
46A replacement kitchen: The first item was the provision of “a replacement kitchen”. Further Particulars were later provided that, “the new kitchen cabinetry and oven/stove were purchased and transported to [the Reservoir property] by the plaintiff in around 1997” and “the existing kitchen…was removed and the new kitchen was installed by the plaintiff and others in around 2002-2003”.
47Photographs produced by Rosa showed that in 1992 there was a wood stove and a gas stove in the kitchen. Rosa said the kitchen was installed in 1972. At some stage prior to 2011, the wood stove was removed and the gas stove was changed. The only other matters referred to by Robert in his evidence was the placing of a tall cabinet in the kitchen for use as a pantry and perhaps the installation of another bench.
48John gave evidence that he has seen some kitchen cabinets in the garage at Robert’s home during Robert’s first marriage and that in about 2008-9 the cabinets were “eventually put in our mother’s house”.
49To describe these changes as “a replacement kitchen” was inaccurate as they were limited to a replacement stove and one or two freestanding cupboards. Otherwise, the kitchen cabinets and the parquetry floor in 2011 appeared to be precisely as they were in 1992.
50General maintenance work: In further particulars, Robert said that since the age of 12 (in 1984) until Mrs Rossi’s death in 2011, he did gardening, collected firewood, moved a large chicken pen, fenced a large vegetable patch, helped build a “make do” fence at the rear of the property, swept floors and “completed chores”.
51John said in evidence that when he was on bail in 2010 he maintained the back fence and in 2014 he had dug up rubbish their mother had buried in the garden. The extent of this rubbish is shown in photographs taken in 2015.
52Robert said in evidence that the “general maintenance work” continued after 1998. It is likely that this included some gardening work and household tasks. It is difficult to make an assessment of the extent of the tasks carried out by Robert. He said, for example, that “I brought my washing back” for his mother to do. Right up until her death, Mrs Rossi, according to both Robert and Rosa, maintained the house and garden in “very good” condition. It appears that Mrs Rossi did most of the work. Although, as Robert said, “sometimes she wanted me to do things at the house”.
53Robert gave the following example. He said that when he was asked by his mother “to stay home and paint a bedroom, I would try to get out of it”. His mother would say, “it is important, you are doing it for yourself. The house needs the work. It is going to be yours someday”, or “at least her share would be”. They were “very general discussions and no one else was around”.
54Laying linoleum floors: The further particulars state that this “occurred in the late 1980s and early 1990s”. No specific evidence was given by Robert about these matters, although Rosa in her Response document said that she and her mother had laid the floors in 1998, before the auction. Some rooms in the house had lino floors, including, apparently, the room in which John stayed in 2010. In the “late 1980s and early 1990s”, Robert would have been aged between 16 and 22. It is unlikely that any significant work was performed by Robert at that time. Tony said that Robert had “changed lino”, “painted the house”, “moved things” and “fixed this and that”, without providing any details of this work.
55Painting of the house several times: The further particulars state that Robert “painted the external window timber frames twice during his childhood” and “the interior walls as required, one room at a time, from his early adulthood through to 2010”. No specific evidence was given by Robert of this work. Robert said that his mother “painted the house”, and he helped at times. After 1998, Robert said that, “I may have painted one or two things including the bricks outside”.
56John, when shown photographs taken in November 2011 of the deteriorating condition of the paintwork and the timber of the external windows, said, “I painted them in the early 1990s”. John said later in his evidence that he “painted the house” in the mid-90s when relatives were to visit from Perth. When Robert asked John in re-examination whether he had helped John do work around the house in the 1990s, John replied, “I like to do things on my own”.
57Installation of downstairs shower: The further particulars state that, “in around 1994 the plaintiff installed a shower frame and glass screen in the new downstairs bathroom”. From a photograph, the shower appears to be a free-standing unit with the glass screen as part of the unit. Robert said in evidence that he “helped with the installation”. It is not clear what “installation” work would be necessary, apart from the plumbing to connect the water supply and take away the waste water. Robert said that the work he did was carried out prior to 1998.
58Laid bricks and closed off the underside of the house: The further particulars state that this work was “completed in 2 stages prior to 1997”, that Robert “assisted his father to complete the first stage which included laying bricks to close off the lower floor of the house” and that later he worked with his mother to “lay garden beds”. Robert was about 5 years old when his parents divorced. He gave no specific evidence of the work he undertook save that he had “laid bricks” and had painted “the bricks outside”, which appeared to relate to the underside of the house. John said that he did not “put the bricks in for the basement”, and thought it was either Robert or their mother who had done this work. Rosa said that she and her mother had carried out the work prior to the auction.
59Payment of utility bills: The further particulars state that Robert “typically provided half of the amount of each utility bill, rates notice and insurance bill that was received by the deceased for most of his adult life”, and gave her cash so that she could pay “the bills at the Summer Hill Post Office”.
60No specific evidence about Robert’s contribution to paying these bills was given. He said in evidence that “every Monday”, he would go to the local “newsagency” with his mother and she would “pay the bills from the bank account” and would “pick up the Italian newspaper”. I did not understand from this evidence that Robert was suggesting that he paid the bills. This evidence was given in the context of Robert describing a routine of driving his mother to “go shopping”, for “hospital visits” or to the “pokies and bingo”.
61The statements from Mrs Rossi’s bank account seemed to confirm what Rosa hadsaid, that her mother “always had sufficient funds to pay her bills as they were due [and that she] always paid her bills at the Summerhill Post Office”.
62Changing the locks: The further particulars stated that “late in her life” Mrs Rossi suffered from dementia and “would often lose her keys”. Robert would assist her as “he had a set of keys”. In November 2011, the plaintiff “replaced the broken lock”. In evidence, Robert said that his mother was “forgetful” and “three times” it was necessary for his partner Tracey to climb in a bedroom window so that his mother could regain access to the house.
63On one occasion, the key became jammed in the door lock. “After 5 weeks”, Robert “insisted on getting it fixed”. His mother gave him $300. The new lock cost $40. Robert fixed the lock and returned the change to his mother.
64Organising the installation of a new hot water system: The further particulars state that in 2007, the old system broke down and Robert “obtained quotes and organised for a new hot water system to be installed”. This involved a “few phone calls”. One phone call was to Tony to ask him for money for the new system. Tony suggested Robert ask Rosa for the money as, “It’s her house”. Later, Tony said, Robert “organised funding through the Council”.
Substantial care for Mrs Rossi
65The statement of claim pleaded that Robert provided the following care for his mother:
“a. support during a six week visit to Italy;
b. support during trips to Queensland, Echuca and Moama;
c. transport and support for shopping and medical and hospital visits;
d. transport and support for community activities; and
e. organising a new refrigerator and television.”
66Six week visit to Italy: In her defence, Rosa referred to the fact that Robert was “16 years old and still at school” when her mother “took him to Italy on 9 August 1988 returning 10 September 1988”. The further particulars asserted that Robert provided “support” for his mother on the trip as, although 16, he was now “the father of the house”. Mrs Rossi was aged about 50 at the time of the trip. This matter was not pursued in evidence at the trial.
67Trips to Queensland, Echuca and Moama: In her defence, Rosa stated that their mother’s “social group organised many day trips and short holidays. The plaintiff was a teenager and enjoyed these holidays very much. The deceased paid for all these trips/holidays”. In later particulars, Robert said that “throughout his adult life [he] escorted [his mother] on her social club trips. The trips ceased in around 2009 when the social club closed down. There were typically 2 to 3 trips per year. The trips were usually to places such as Echuca, Moama and Queensland, and [his mother’s] English was poor so she needed [Robert] to travel with her”.
68Robert gave evidence that he had, at times, driven his mother to her social group’s weekly gatherings. There was little, if any, evidence of the trips the group took. John said that their mother’s “English language was good. She was able to communicate…to read simple things, like the mail and someone helped her to write”. He said also that it was her Italian Group which was “a very big part of her life”.
69Rosa said in her Response document that “the extended trips ceased in 1990 [although] the social club was still running”. Rosa said her mother’s “ English was excellent and she never had any need for an interpreter” and her community work included “service on numerous committees and boards”.
70Transport and support for shopping and medical and hospital visits: The further particulars stated that Robert “provided this help throughout his entire adult life, and he drove [his mother] every day for 6 months to visit [Rosa] who was in hospital with complications arising from the birth of a child in 1992”.
71Robert gave evidence that he would pick up his mother from the Civic Centre and they would “go shopping” and do “hospital visits” and “two to three times a week” take her to “the pokies or bingo”. Robert said he picked up Rosa’s daughter Laura “for a number of years” after school. Rosa suggested to Robert that this was only for a period of one year when she was working and Laura was at school.
72Rosa said that after Laura was born, Laura was very sick and had remained in hospital for 6 weeks, although Rosa had been discharged after 4 days. During this period, Rosa said she drove her mother to the hospital “whenever she wished to visit her grandchild”.
73I consider it likely that, on occasions, Robert assisted his mother, but not with the regularity and frequency he suggested. Rosa said that her mother walked to the Summerhill Post Office to pay her bills and did her shopping in the area. Rosa produced from the records kept by her mother copies of specialist doctors’ appointments. These were a total of 17 visits referred to in the documents over the period from 2006 to 2010. For about 10 months from March 2006 to January 2007, and in May 2007, Mrs Rossi received fortnightly home care visits of 1.5 hours.
74Transport and support for community activities: The further particulars stated that Robert “always drove [his mother] to and from her job at Pizza Napoli restaurant between 1990 and 1994 (where [Robert] also worked) on Friday, Saturday and Sunday nights”. Robert “regularly drove [his mother] to bingo several times a week throughout his entire adult life”, and he “regularly drove [his mother] to her social club once a week throughout his entire adult life”.
75Rosa said in the response to the particulars, which she adopted as part of her evidence, that in 1985 Mrs Rossi worked part-time as a cook at Pizza Napoli. She stopped working in 1988 due to ill-health and had not had paid employment after that. Mrs Rossi secured part-time employment for Robert as a waiter at the restaurant in 1986 when he was aged 14. He did not obtain a driver’s license until he was 18. Mrs Rossi and Robert travelled together to work by tram and caught a taxi home, for which Mrs Rossi paid. Robert did not refer to this matter when he addressed Rosa’s response document.
76Organising a new refrigerator and television: The further particulars state that Robert “organised a new refrigerator through a Centrelink loan plan in 2007 and he purchased a new $700 National Panasonic television for [his mother] in 2003”. There was no supporting evidence that Robert purchased a new television for his mother. There was evidence from Rosa that Robert over the years left at his mother’s house a number of television sets which he had replaced with new sets for his own use. The presence of these television sets was supported by photographs.
77Moving his mother’s possessions in 1998: The further particulars state that, “along with others, [Robert moved his mother] and all her possessions back into [the Reservoir property] after the auction in 1998”. Rosa’s evidence was that their mother never moved out of her home. Some of her possessions were moved from her home to Rosa’s home before the auction to make the Reservoir property appear less cluttered.
The “understanding” between Robert, Rosa and their mother
78The statement of claim alleges that there was an “understanding” constituted by the “awareness” by Rosa and Mrs Rossi that Robert was “using his own money and providing his own labour and expertise in carrying out the improvements and providing the care, in the expectation of acquiring an interest with [his mother] and/or [Rosa] as co-owner in the [Reservoir] property”.
79By “acquiescing” in Robert expending his money and contributing his labour to the improvements and the care, Mrs Rossi and Rosa “encouraged” Robert to “believe that he would acquire an interest” with his mother as co-owner of the Reservoir property, and Robert “thereby acted to his detriment”.
80Robert’s solicitors later in September 2015 gave further particulars of the “awareness” and “acquiescence” by his mother and Rosa by reference to the following matters:
a.he was the closest child to their mother;
b.he was the “only one that consistently provided” substantial care for his mother and improvements to the Reservoir property;
c.Mrs Rossi and Rosa knew that Robert was providing the improvements and care;
d.in Robert’s presence, his mother “frequently referred” to the property as “our house”;
e.Mrs Rossi “often said” to Robert “over the years that ‘this will always be your home’”;
f.he never saw his mother’s will;
g.he was not aware that the Reservoir property was owned jointly by his mother and Rosa;
h.Mrs Rossi and Rosa did not disclose to Robert that the Reservoir property was “owned jointly, not as tenants in common”;
i.the transfer of the Reservoir property to Mrs Rossi and Rosa as joint proprietors “does not represent the intention of the parties”. The intention was that Mrs Rossi held her interest in the Reservoir property “as a tenant in common”;
j.as Rosa later admitted in an email dated 31 January 2012, the transfer into joint ownership “was to save on the stamp duty at the time”.
81In further particulars provided by Robert in February 2016 (which he adopted in his evidence as true and correct), he gave further details of how “the understanding was communicated to members” of the family including Rosa. These details included:
a.after the auction in August 1998, during a visit by Robert to his mother, she told him that Rosa “had accessed her superannuation funds early and was able ‘to help her (the deceased) keep the house’ by purchasing the deceased’s ex-husband’s share of the property. The deceased used her own funds for the other half of the purchase price. During this conversation the deceased said to the plaintiff words to the effect of ‘this is still going to be your house, I know you didn’t have the money’”;
b.in about June 2001 when Robert had “replaced” the kitchen at the Reservoir property “with a kitchen he had previously purchased”, his mother said to him “words to the effect of ‘it is important for you to take care of our house because it is our home and anything you contribute is for your own benefit later on’”;
c.in about 2001, when John and his son were living at the Reservoir property, during a visit by Robert their mother said to them “that the plaintiff was entitled to half the property (in conjunction with his sister) as the rest of the deceased’s children had grown up and moved on but the plaintiff continued to provide care and support as well as maintain the property”;
d.in about 2007, in the presence of Robert and his partner Tracey, Robert had asked his brother Tony for money to replace the hot water system at the Reservoir property. Tony asked his mother “why she didn’t ask Rosa for the money and the deceased responded with words to the effect of ‘it’s Rob’s house too and I don’t want to talk to Rosa’”.
82The evidence given by Robert and his brothers of discussions with their mother about matters relating to the property and what would happen after her death was as follows:
a.John said that in 2010, whilst he was living with his mother, he had a conversation with her. His mother “said she was leaving things to Rosa and Laura” and that “she was grateful that Rosa had bought the house” at the auction. Initially he said it was a discussion about her “will” but he said, shortly after that, “She didn’t tell me directly about a will, she was packing things up to give to Laura... We never discussed what she intended” and there was “no mention of a will”. The “talk was that our father was paid out for his half of the house. There was no discussion about the half left with my mother. I knew my sister had bought the house and paid out our father. I expected the house would go to the children”;
b.John later said in his evidence that he had “no discussions with his mother about what was to happen with the home”;
c.during cross-examination, John said that in the conversation in 2010 with his mother, she said she had left everything to Rosa and Laura. John said, “We talked briefly about the house. I thought she owned half the house. She said she was leaving things to Rosa”. John agreed that there was “no discussion about an understanding with Robert”. John said that, “Before the property was sold [at auction], I thought it was going to the children”;
d.John said that after the Family Court proceedings, the Reservoir property was to be sold and the proceeds split although the sale would not occur while Robert was “going to school”. John said that he had “no other knowledge of an understanding” and that there had been “no discussion” with his mother and Robert, Michael (John’s son) and Tracey;
e.John agreed that he sent a text message to Laura on 19 May 2015 as follows: “Just bumped into robert and tracy. I had nothing to say to them but they asked me about you and your mother. He said he is fighting for his share of the house and that he was the one who helped mum. I told him mums wishes as she told me and to leave it alone he didnt want to listen. If you need a witness you can call me. Take care”;
f.Robert said in evidence that at the auction of the Reservoir property, a friend bid on Rosa’s behalf and Mum“told me that she [Rosa] was able to purchase my father’s half share”;
g.Robert said that “when John moved back in” to the Reservoir property, his mother “told John that she was happy for him to stay but not to tell Rosa”. His mother had said to Robert that she “didn’t want money from each of us [although] she expected me to contribute to the home” and that this “was for my benefit”. Robert said that it was “common knowledge” that the Reservoir property would “come to me”;
h.Robert said that he did not know that his mother “had a will”. He said that his mother told him that “Rosa had put money into the house” so that “half would go to her”. From her mother’s half, the funeral costs would be paid and “whatever was left would go to me”. There was “no way that Mother wanted to leave me out of this”;
i.Robert said that at the time of the auction in 1998, “I was just married and living in my own home. I believed Mum would move in with Rosa. I thought it was what was best as Rosa lived close by. I was happy to do anything. Mum could have come to me but I was recently married. I was never told that there was an issue and no other options were discussed. We had assumed that our mother would live with Rosa and be cared for by her”;
j.Robert said that his mother “kept me out of all the legal things and that was why I never got involved”. After the auction, “Mum had a half share in the [Reservoir] property. Rosa had made an investment. She had purchased half the property to help out mother”;
k.Robert said that he “knew on the day of the auction that Rosa had purchased the [Reservoir] property;
l.Robert said that Rosa was aware of the “understanding”. He said, “Why else would I do things? Why else would it be in my interest? If a child is doing something, it is for their benefit in the future… If I am doing the work and caring, I should get the benefit”;
m.Robert said that, now after his mother’s death, “Rosa has the house and possessions. Being the youngest son, why aren’t I part of it? Maybe I wouldn’t have been so loving”, if he had known;
n.when Robert was commenting on Rosa’s Response document he said, “I don’t see how Mum would not want me to have her share. It doesn’t make sense”. He said that the children “always understood what was going to happen…Rosa had a house and half the Reservoir house was Mum’s. I was still in and out. It was common knowledge in the family; known to all of us. I didn’t have my own home. I was probably going to inherit Mum’s share when she passed on or it would be there for us…It was always going to be the family home for whoever needed it. I was the only one who needed it…It wasn’t worded or discussed between us as a group”.
o.Robert said that when he was asked by his mother “to stay home and paint a bedroom, I would try to get out of it”. His mother would say, “it is important, you are doing it for yourself. The house needs the work. It is going to be yours someday”, or “at least her share would be”. They were “very general discussions and no one else was around”.
p.Tony said that “everyone else dumped” their mother but Robert was “there till the end” and “all the children acknowledged it”. He thought the Reservoir property would be “all Rosa’s and yours [Robert’s]”. Half was Rosa’s and “Robert was the only one who stayed there till stumps”;
q.Tony said that it was “six months or a year after the auction that I found out Rosa had bought half the house. She got it cheap”. The will was “ridiculous” as “she [Mrs Rossi] would have wanted you [Robert] and Rosa to have it”;
r.Tony said that after their mother’s death, he said to Rosa, “Don’t you think Robert deserves something too?” Tony said that Rosa “went crazy”. Tony said to her, “Don’t shit it. I will give a lawyer $200,0000 to fight you and you’ll get nothing”;
s.Tony said that when Robert had phoned him in 2007 asking for money for a gas hot water service for their mother, he had said, “What’s wrong with Rosa, it’s her house?” Robert had said, “Mum didn’t want to tell Rosa”. Tony then said, “I didn’t have the money to help”;
t.Tony said to Robert that he should go to see his [Tony’s] lawyers and that what had happened was “not right, it’s your birthright. All the children are entitled to a share” of the Reservoir property;
u.after Tony had stood down after completing his evidence, he talked to Robert at the bar table. Robert asked to recall Tony to give further evidence. Tony said that in the conversation with his mother in which she told him that Rosa had bought the house, his mother had asked, “Was I aware that when the house was sold, Rosa had bought half the house and that when she [Mrs Rossi] goes, it [the Reservoir property] will end up being Robert’s and Rosa’s because the rest of you have abandoned me”. Tony said that this conversation occurred when he went back to the house about 2 to 3 years after it had been sold.
Legal principles
83I will consider whether the evidence produced at the trial is capable of supporting a claim by Robert:
a.in contract;
b.based on proprietary estoppel;
c.pursuant to a resulting, implied or constructive trust;
d.for restitutionary relief.
84Contract: To establish a contract there must be certainty of parties and certainty of terms. Even at its highest, the evidence is incapable of supporting a finding that Robert, Rosa and their mother entered into a binding agreement as to what was to happen to the Reservoir property after Mrs Rossi’s death and which might have resulted in Robert having an entitlement to share in the property or the proceeds of sale. This possible head of claim will not be considered further.
85Proprietary estoppel: In Giumelli v Giumelli (1999) 196 CLR 101 (“Giumelli”), the High Court stated that equitable relief will be granted where it is founded upon, “an assumption as to the future acquisition of ownership of property which has been induced by representations upon which there had been detrimental reliance”. The Court said that this was “a well recognised variety of estoppel as understood in equity” (paragraph 6).
86In Donis v Donis [2007] VSCA 89 (“Donis”), a decision of the Victorian Court of Appeal, Nettle JA (with whom Maxwell ACJ and Ashley JA agreed), referred to the situation where a person had encouraged the expectation of “the acquisition of an interest in property. In such cases the remedy relates to the understanding of the parties and the expectation that has been encouraged. Prima facie the estopped party can only fulfil his or her equitable obligation by making good the expectation which he or she has encouraged. The estopped party, having promised to confer a proprietary interest on the party entitled to the benefit of the estoppel, and the latter having acted upon the promise to his or her detriment, is bound in conscience to make good the expectation. It follows that the detrimental reliance that supports the estoppel need not constitute in any sense a consideration moving to the party bound. It is a unilateral element of the estoppel and not the price paid for it” (paragraph 19).
87In Delaforce v Simpson-Cook [2010] NSWCA 84 (“Delaforce”), a decision of the New South Wales Court of Appeal, Handley AJA (with whom Allsop P and Giles JA agreed), said that the proprietary estoppel upheld by the trial judge was an “estoppel by encouragement. Such an estoppel comes into existence when an owner of property has encouraged another to alter his or her position in the expectation of obtaining a proprietary interest and that other, in reliance on the expectation created or encouraged by the property owner, has changed his or her position to their detriment. If these matters are established equity may compel the owner to give effect to that expectation in whole or in part” (paragraph 21).
88Flinn v Flinn [1999] VSCA 109 (“Flinn”), a decision of the Victorian Court of Appeal, was a case where a claim in proprietary estoppel was based upon a promise to leave an interest in a farming property to the promisor’s, and his wife’s, adopted son. Brooking JA (with whom Charles and Batt JJA agreed), referred with approval to the statement of Carnwath J in Gillett v Holt [1988] 3 All ER 917 (“Gillet”) at 930, that, “The plaintiff needs to show words or conduct by the prospective testator which go beyond mere statements of intention, and which, having regard to all the circumstances, he can reasonably claim to have regarded as amounting to an irrevocable promise by the prospective testator as to how his estate would be disposed of” (paragraph 73).
89In considering the question of, “How certain must the promise be?”, Brooking J considered that “a promise must be definite in the sense that there is a clear promise to do something even though the something promised is not precisely defined, and this has always been recognised in the cases” (paragraph 80).
90After reviewing the cases and noting “the liberal approach exhibited by the authorities”, Brooking JA concluded that the promise found by the trial judge in the appeal before the Court, a promise of an unspecified interest in the farm to be devised by will was not too uncertain to found a proprietary estoppel – and that the later “making of the enhanced promise [some years later]…was by way of a natural progression”. The plaintiff had acted “on the faith of a promise at first vague (but not too vague to escape equity’s attention) and later ripening into a promise of the whole farm” (paragraph 94).
91The revocable nature of a will does not affect the promise of a future proprietary interest, if reliance and detriment can be shown. In Gillett, Robert Walker LJ said:
“…the inherent revocability of testamentary dispositions (even if well understood by the parties…) is irrelevant to a promise or assurance that ‘all this will be yours’…Even when the promise or assurance is in terms linked to the making of a will…the circumstances may make clear that the assurance is more than a mere statement of present (revocable) intention and is tantamount to a promise” (at 227-8, cited with approval by Handley AJA in Delaforce at paragraph 36).
92In Flinn, Brooking JA stated that, a claimant must show “substantial detriment…occasioned to the claimant by reliance upon a promise. Unless the reliance occasions detriment, no equity will arise” (paragraph 96).
93In Donis, Nettle JA stated that, “‘Detriment’ is no narrow or technical concept. It need not consist of expenditure of money or other quantifiable financial disadvantage so long as it is something substantial. The requirement must be approached as part of a broad enquiry as to whether departure from a promise would be unconscionable in all the circumstances” (paragraph 20).
94At paragraph 34, Nettle JA noted that in the case on appeal, “the detriment suffered is of a kind and extent that involves life-changing decisions with irreversible consequences of a profoundly personal nature”. He was referring to the claimant’s decision to marry and move to live in a house on her parents-in-law’s property out of Melbourne.
95In Delaforce, Handley AJA noted at paragraph 42 that, “The relevant detriment is not the loss flowing from non-fulfilment of the promise or assurance”. He referred to the judgment of Dixon J (as he then was) in Grundt v Great Boulder Proprietary Goldmines Ltd (1938) 59 CLR 641 at 674-5, where it was stated that:
“It is often said simply that the party asserting the estoppel must have been induced to act to his detriment. Although substantially such a statement is correct and leads to no misunderstanding, it does not bring out clearly the basal purpose of the doctrine. That purpose is to avoid or prevent a detriment to the party asserting the estoppel by compelling the opposite party to adhere to the assumption upon which the former acted or abstained from acting. This means that the real detriment or harm from which the law seeks to give protection is that which would flow from the change of position if the assumption were deserted that led to it. So long as the assumption is adhered to, the party who altered his situation upon the faith of it cannot complain. His complaint is that when afterwards the other party makes a different state of affairs the basis of an assertion of right against him then, if it is allowed, his own original change of position will operate as a detriment”.
96In Flinn, Brooking JA quoted at paragraph 121 from the judgment in Giumelli at 117-118 where the majority in the High Court had said, “Although the claimant had not suffered an appreciable loss of income by remaining in the partnership, the detriment suffered by him was the loss of the property which he worked to improve, not to obtain immediate income from that exercise but to gain the proprietary interest. For that [the claimant] gave up the opportunity of a different career path”.
97In Sidhu v Van Dyke [2014] HCA 19, (“Sidhu”) the High Court considered the question of “the sufficiency of proof of detrimental reliance required to give rise to a sound claim for relief based on” proprietary estoppel (paragraph 2). The Court rejected the proposition that there was a “presumption of reliance”, the plurality stating at paragraph 50 that the statement by Brooking JA in Flinn does “not support the proposition”. The plurality noted at paragraph 71 that, “it is not necessary that the conduct of the party estopped should be the sole inducement operating on the mind of the party setting up the estoppel”. At paragraph 84, the plurality cited with approval the observations of Nettle JA in Donis that “the detriment suffered is of a kind and extent that involves life changing decisions…”, which comments the plurality considered were “apposite” to the facts of the case before the Court.
98Brooking JA in Flinn at paragraph 119, in considering the issue of, “How to satisfy the equity”, referred to Giumelli as having established that:
“in cases of what is commonly called proprietary estoppel, in which it may be said that prima facie departure from the assumed state of affairs is contrary to the requirements of conscientious conduct, it is a question depending on all the circumstances of each case whether departure is to be permitted. The court may require the party estopped to make good the assumption, and may in an appropriate case impose terms upon the other party. On the other hand having regard to the requirements of conscientious conduct by the party estopped and, in an appropriate case, to the need to avoid injustice to third persons, the court may decide that some lesser relief is appropriate”.
99Handley AJA in Delaforce stated the following principles in relation to the granting of relief:
a.in a claim based on proprietary estoppel, relief is granted where a person has changed their position to their detriment in reliance upon encouragement by another person to do so “in the expectation of obtaining a proprietary interest” (paragraph 21);
b.relief is not “limited to removing or reversing the detriment suffered by the party entitled to the estoppel” (paragraph 56);
c.“the court must look at the circumstances in each case to decide in what way the equity can be satisfied” (paragraph 57);
d.“the court does not exercise an unfettered discretion but adopts a principled approach” (paragraph 58);
e.“relief may be moulded to recognise practical considerations such as the need for a clean break…the court must also take into account the impact of its orders on third parties and any hardship or injustice they would suffer” (paragraph 60);
f.the relief must not be “out of all proportion” (paragraph 62);
g.the relief may take account of the fact that the circumstances of the representor have changed (paragraph 80).
100In Sidhu, the plurality at paragraph 85, when considering what relief was appropriate, stated that, “where the unconscionable conduct consists of resiling from a promise or assurance which has induced conduct to the other party’s detriment, the relief which is necessary in this sense is usually that which reflects the value of the promise”.
101The plurality at paragraph 83, stated that “the requirements of good conscience may mean that in some cases the value of the promise may not be the just measure of relief” noting the statement of Deane J in The Commonwealth v Verwayen (1990) 170 CLR 394 at 441 that, “There could be circumstances in which the potential damage to an allegedly estopped party was disproportionately greater than any detriment which would be sustained by the other party”.
102Resulting, implied or constructive trust: The expression, “implied trusts” is used “to cover both resulting and constructive trusts, so as to distinguish such trusts from express trusts, or to cover resulting trusts, or particular kinds of resulting or constructive trusts, for example those founded on a transferor’s presumed intention or a common intention of the parties, or indeed to cover constructive trusts which are not founded on such an intention” (see Lewin on Trusts, 19th edition, 2015, paragraph 7-004). As a separate concept, implied trusts will not be considered further.
103A resulting trust may arise in limited circumstances. Most relevant to the present case is where a person makes a voluntary payment to another person, or pays wholly or in part for the purchase of property which is vested in the other person. In these circumstances there is a rebuttable presumption that the payer did not intend to make a gift to the other person, so that the money is held on trust for the payer, or in the case of a joint purchase by them, in shares proportionate to their contributions (see Halsbury’s Laws of Australia, Lexis Nexis, 2015, (Trusts – 1. Nature and creation of trusts – (3) Non-express trusts – (A) Definition and classification of Resulting trusts – (1) Generally), citing Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] AC 669, per Lord Browne-Wilkinson).
104Halsbury’s continues, “Resulting trusts must satisfy the requirements of certainty of subject matter and certainty of object. However, the statutory formalities which apply to some express trusts [including s. 53 (2) of the Property Law Act 1958] do not apply to resulting trusts”, or to constructive trusts.
105Further, as suggested by Lewin on Trusts at paragraph 7-005, “equity imposes a [resulting] trust in order to prevent unconscionable conduct on the part of the legal owner…[I]t would seem to be clear, however, that a resulting trust is enforceable as such only when the conscience of the trustee is affected by his having knowledge of the facts creating the relationship of the trustee and beneficiary”.
106“Constructive trusts are imposed by law in certain circumstances that the law interprets (“construes”) as requiring the holder of property in good conscience not to retain it, or the beneficial interest in it…[T]here are some trusts, often classified as constructive trusts, where the intention of the holder of property is critical to the creation of the trust…But such trusts are not founded on intention in the way that express trusts are. They are imposed by law by reason of the existence of the intention of the holder of property combined with the presence of other factors which affect his conscience, such that equity imposes a constructive trust on him, and to ensure that he cannot deny the interest of the beneficiaries under the trust” (Lewin on Trusts, at paragraph 7-002).
107As Halsbury’s, under the heading “(B) Constructive trusts (1) Definition and nature”, states, “The rationale for constructive trust relief is that, in the absence of such relief, a person may secure or maintain an interest in property or money that it is contrary to equitable principle for that person to obtain or retain. Constructive trust relief is appropriate where the court finds that a person could not in good conscience retain for himself or herself a benefit, or the proceeds of a benefit, he or she has appropriated in breach of his or her contractual or other legal or equitable obligations to another. To this end, the constructive trust arises by operation of law, regardless of actual or presumed intention. It can therefore be imposed even contrary to the intention of the parties in issue”.
108One of the more common examples of where the law will impose a constructive trust is where a person contributes to the acquisition and maintenance of properties acquired by another person with whom they are in a personal joint relationship or endeavour characterised by a pooling of assets or resources. In Cressy v. Johnson [2009] VSC 52, Kaye J analysed the relevant High Court decisions. At paragraph 187, Kaye J noted that the decisions “emphasised that the law does not impose a constructive trust in accordance with ‘idiosyncratic notions of what is just and fair’. Rather, the existence of a constructive trust, and its content, will only be recognised to the extent necessary to prevent conduct regarded as unconscionable, pursuant to equitable principles, upon the failure of a relationship between two parties”.
109Justice Kaye referred to the judgment of Deane J in Muschinki v. Dodds (1986) 160 CLR 583 at 621 where Deane J stated that the “rationale and operation” of the relevant equitable principles “is to prevent wrongful and undue advantage being taken by one party of a benefit derived at the expense of the other party in the special circumstances of the unforseen and premature collapse of a joint relationship or endeavour”.
110Restitutionary relief: In certain circumstances, a court may grant restitutionary relief and restore to a party the benefits which flowed to another party by the receipt of a payment or the receipt of services, in circumstances where it would be unconscionable for the receiving party to retain the benefit.
111In Equuscorp Pty Ltd v. Haxton (2012) 246 CLR 498, the judgment of French CJ, Crennan and Kiefel JJ referred at paragraph 30 to the explanation given by the High Court in David Securities Pty Ltd v. Commonwealth Bank of Australia (1992) 175 CLR 353 of “the part played by unjust enrichment in a claim for money had and received (in that case for recovery of a payment made under mistake of law)”.
112The judgment gave the following summary:
“• recovery depends upon enrichment of the defendant by reason of one or more recognised classes of ‘qualifying or vitiating’ factors;
•the category of case must involve a qualifying or vitiating factor such as mistake, duress, illegality or failure of consideration, by reason of which the enrichment of the defendant is treated by the law as unjust;
•unjust enrichment so identified gives rise to a prima facie obligation to make restitution;
•the prima facie liability can be displaced by circumstances which the law recognises would make an order for restitution unjust”.
113Recognised classes of qualifying or vitiating factors would include:
a.work performed “at the request of” a defendant;
b.“acquiescence in the provision of services by builders knowing that the services were not being rendered gratuitously”;
c.a defendant who “did not take a reasonable opportunity open to him to reject the performed services”;
d.a “contract which fails to materialise”.
See Lumbers v. W Cook Builders Pty Ltd (in liq.) [2008] HCA 27;(2008), 232 CLR 635 at paragraphs 39 and 53 per Gleeson CJ.
Analysis of the evidence
114There are some further issues concerning the evidence and the way in which it was given which require comment, as follows:
a.Robert’s responses in his exchanges with Rosa during his cross-examination of Rosa, and her cross-examination of him;
b.Robert’s allegation that Rosa was “controlling” and Rosa’s allegation that Robert was a “bully”;
c.the evidence about Robert’s gambling;
d.Robert’s unwillingness to consider that his mother and Rosa may have acted rationally and honestly.
115During the hearing, it was usually necessary for me to exercise some control during the giving of evidence to ensure that the parties and the witnesses remained focussed. On two or three occasions, I let the exchanges between Robert and Rosa run on for some minutes without interruption. Very quickly, the parties started bickering; interrupting each other, asking the other a question in response to a question, commenting on answers and, at times, descending into “I say”, “you say” exchanges.
116My perception was that when Robert asked a question and Rosa commenced to give an answer he disagreed with, Robert would interrupt and either make a contrary comment or switch the subject matter without giving Rosa the opportunity to complete her answer to the original question.
117Robert noted that in Rosa’s defence and her “Response” to his second set of further particulars, she had referred to him as a “bully” on many occasions. Rosa explained this term as not connoting physical threats but rather that his conduct was “psychological”. Robert’s response to being questioned by Rosa and his cross-examination of Rosa, in my view displayed an attitude of not wanting to listen to what Rosa had to say and was, in that sense, illustrative of what Rosa described as Robert’s “bullying conduct”. I do not consider that the description she gave of Robert and his conduct should be a reason to discount what she said as “lies”, as Robert suggested.
118Robert described his sister as “controlling”, using the term in a pejorative sense. It appears, however, that Rosa’s brothers and her mother admired her ability to manage her own personal finances and, on their own behalves, sought her advice or assistance. What they did not like to accept were the questions she asked before she offered help or the terms she sought to impose as a condition of her assistance.
119Examples of the seeking of assistance, and the conditions Rosa sought to impose included:
a.with her mother, paying off her credit card when the house was purchased in 1998, and apparently extracting a promise that her mother would not go into debt in the future to give financial assistance to her sons;
b.with John, after discussion with him, drawing up a written agreement with the conditions she wished to impose, after she had provided her own property as security for the grant of bail. John’s response was to tear up the agreement in front of her;
c.with Robert, being wary whenever he sought to borrow money from her to ensure that the loan would not be used to feed what she perceived as a gambling habit.
120The issue of Robert borrowing money was a constant theme during the evidence. Robert denied that it was anything more than him borrowing “a few dollars” from a family member, which he quickly repaid. He denied that he had a problem with gambling and sought, on one occasion, to equate his gambling with his mother’s regular attendance at bingo or “the pokies”.
121The evidence about Robert’s borrowing from family members, included:
a.Robert said that he never borrowed money from his mother or Rosa, except perhaps for $20 to $50 he borrowed from his mother;
b.Tony said that Robert has, “a couple of times phoned me and asked for money, a couple of hundred here and there…about $80…he always tried to pay me back”;
c.when cross-examining Rosa about her evidence that Robert was “always borrowing money” from her, Robert asked her to give “one example of when he had asked her for money”. Rosa said that Robert asked her for $400 so that he could buy a ring for Tracey and suggested she “put it on her credit card”. Robert immediately interrupted to say, “I asked for money to purchase a car”. Rosa responded, “You always said one thing and did another”.
122Rosa said that when Robert started working at Crown Casino, his “personality changed”. Robert admitted that he visited casinos when he travelled interstate. Robert said this was not unusual. He said, “I like to gamble”. Robert asked Rosa why she considered that he had a gambling problem. She responded, “Why was it that, when he had a job, he kept borrowing money?”
123These matters have, perhaps, marginal relevance to the issues in dispute. They do, however, provide part of the context in which to consider the relationship between Mrs Rossi, Rosa and Robert, together with other matters, including:
a.the breakdown of the parent’s marriage;
b.the criminal activities of John, Tony and their father;
c.the severing of all relations by two of the sisters with their mother;
d.Mrs Rossi’s personal strength and independence;
e.the importance of the Reservoir property to her and the care with which she maintained the house and garden;
f.Mrs Rossi’s continued welcome for her sons when they returned home, including for John’s son Michael;
g.the continued contact Robert had with his mother, until he left home, and to a degree afterwards, when he had established an independent life;
h.Rosa’s practical support for her mother which enabled Mrs Rossi to continue living in her own home;
i.Rosa’s break with her mother in 2001, although she continued to monitor her mother’s activities particularly through her daughter Laura;
j.the personal issues including serious health conditions with which Rosa had to cope during the period of separation from her mother.
124I consider that Robert’s perception of the assistance that Rosa provided for their mother in 1998 was that Rosa had purchased their father’s half share and that their mother had retained a half share which she was free to dispose of when she died, subject only to payment for her funeral from her share. As Rosa had her own home and half the Reservoir property, it was only fair that his mother should leave her share to Robert, the only child who had remained constant and law-abiding.
125If the will said otherwise, or the Reservoir property passed by survivorship to Rosa as the joint proprietor, these were matters which did not affect their mother’s intention. Mrs Rossi must have been duped, by Rosa, into executing the will and for the property to have been placed in their joint names, rather than them holding as tenants in common. This was so notwithstanding the fact that for the last 10 years of Mrs Rossi’s life, Rosa was in no position to influence what her mother did because she was not in contact with her. I consider that the views expressed by Robert on these critical matters were inconsistent with the objective facts.
126Robert lived at home until he married in 1997 at age 25. There is little evidence to suggest that for the whole of this period he assumed significant responsibilities to assist his mother around the house, or in any way altered his lifestyle to accommodate the needs of his mother. When he had entered into a permanent relationship, Robert left home to live with his wife in a home provided by his in-laws. Robert would have known that by leaving home, it was likely his father would require the Reservoir property to be sold. Robert thought that when this happened, his mother would go to live with Rosa.
127After Robert left home, the Reservoir property was secured for his mother by Rosa’s intervention. Although Robert’s marriage broke down, he continued to live in the matrimonial home before purchasing a unit of his own. After he established a relationship with Tracey, there was probably less time and reason for Robert to spend time with his mother or for visiting the Reservoir property. The fact that he did visit, did some work and provided a level of assistance probably reflects the attentiveness of a responsible adult child towards their aging mother who was living alone. The evidence, however, does not justify the Court intervening to “prevent conduct regarded as unconscionable”, either by Mrs Rossi or Rosa in relation to Robert.
128In these circumstances, it is difficult to accept the evidence given by Robert and his two brothers where it conflicts with Rosa’s evidence and particularly as their evidence is so lacking in specificity or any supporting documentation. Essentially, Robert’s claim must fail because:
a.there is no credible evidence that he improved the Reservoir property or provided care and support to his mother to a “substantial” extent;
b.it would not be unconscionable if the Court were not to intervene to restore to Robert a benefit that Rosa would otherwise retain;
c.the assistance provided by Robert did not involve any significant detriment;
d.Robert’s help was not offered in reliance upon any credible representation, promise or assurance given by Mrs Rossi;
e.Rosa had no knowledge prior to her mother’s death in 2011 of Robert’s claim or any facts which might give rise to the basis for a claim which might affect her interest in the Reservoir property.
129Rosa produced the current municipal rates certificate which shows the Capital Improved Value of the Reservoir property at 1 January 2014 as $435,000. A valuation obtained by Robert, valued the property as at 11 February 2016 at $600,000. Whilst the rise in value of the Reservoir property since 1998 might be seen as a windfall for Rosa, or as Tony suggested, a good return on her “investment” of $75,337.37, that is irrelevant unless there is a proper basis for the grant of relief to Robert.
Specific defences raised by Rosa
130By her defence, Rosa in addition to putting in issue the factual basis for Robert’s claim, raised three specific legal defences, as follows:
a.pursuant to sections 41 - 43 of the Transfer of Land Act1958, she and her mother had obtained “an indefeasible title to the [Reservoir] property free of any beneficial interest” in favour of Robert, upon registration of the transfer to them in 1998. Similarly, when Rosa was registered as the registered proprietor by survivorship in 2012, she obtained an indefeasible title free from any encumbrances which were not then recorded on the title to the property;
b.equitable relief should be denied to Robert by reason of “laches, acquiescence and delay”;
c.any cause of action by Robert against Rosa was barred by sections 5 or 8 of the Limitations of Actions Act 1958.
131Prior to the auction in 1998, there was no evidence to suggest that Robert had been promised or encouraged to believe that he would obtain an interest in the Reservoir property. He believed that the property would be sold and his mother would go to live with Rosa. After the auction, it is not suggested that Rosa was a party to, or had knowledge of, any conversations with Robert or the other brothers in which statements were made that might have suggested to Robert that he was to have an interest in the Reservoir property after his mother’s death.
132In her final submissions, in the form of her “statement for trial”, Rosa said that she also relied on “sections 53, 54 and 55 of the Property Law Act 1958 that state that a verbal agreement/understanding without something more in writing does not give rise to a caveatable interest in land”.
133Transfer of Land Act and Property Law Act: In my view, the provisions of the Transfer of Land Act and the Property Law Act relied on by Rosa would not necessarily be a complete answer to a claim by Robert, if the facts were sufficient to found appropriate equitable relief. For example, section 53 (3) of the Property Law Act specifically provides that, “This section shall not affect the creation or operation of resulting, implied or constructive trusts”. However, in the circumstances of Robert’s claim, I consider that there is no doubt that Rosa obtained an indefeasible title when she was entitled to be registered as the sole proprietor of the Reservoir property upon the death of her mother in November 2011. There was no basis for suggesting that prior to that time she was aware of Robert’s claim.
134Laches, acquiescence and delay: Rosa’s defence refers to Robert having “been guilty of laches, acquiescence and delay” by reason of his failure:
a.to “claim any beneficial interest in the Reservoir property during the auction” on 22 August 1998;
b.to “lodge a caveat” (presumably prior to February 2012);
c.to notify his mother in writing “of the beneficial interest he claimed and the basis of it”;
d.to make a claim against his mother’s estate.
135I consider, that if Robert had otherwise had an entitlement to equitable relief, the failure to do the things alleged would not have affected that entitlement.
136Statute of limitations: I consider that any claim by Robert had not crystalised prior to his mother’s death in November 2011, and that accordingly, a statute of limitations defence could not be raised to defeat an otherwise valid claim.
Proposed Orders
137In the circumstances of this proceeding, the following orders would seem appropriate:
1.Judgment for the defendant against the plaintiff that the plaintiff’s claim be dismissed.
2.Pursuant to section 90 (3) of the Transfer of Land Act 1958, order that caveat no. AJ469382Q lodged on the plaintiff’s behalf with Land Victoria on 6 February 2012 in respect of Certificate of Title Volume 8639 Folio 003, be removed.
138I will hear the parties further in relation to the question of costs and any other orders considered appropriate.
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Certificate
I certify that these 34 pages are a true copy of the reasons for decision of His Honour Judge Anderson delivered on 7 April 2016.
Dated: 7 April 2016
Carla Cianfaglione
Associate to His Honour Judge Anderson
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