Saba v Xu

[2004] NSWSC 858

Reported Decision: (2004) DFC 95-299

Supreme Court

CITATION:	Saba v Xu [2004] NSWSC 858
HEARING DATE(S):	11 and 12 November 2003, 14 and 15 April 2004
JUDGMENT DATE:	28 September 2004
JURISDICTION:	Equity Division
JUDGMENT OF:	Master McLaughlin at 1
DECISION:	(1) I stand the proceedings over to a date to be fixed by arrangement with my Associate for the bringing in of short minutes and, if desired, for argument as to costs.
CATCHWORDS:	Family Law. - De facto relationship. - Whether or not such a relationship existed. - Marriage contracted by Plaintiff during the course of alleged de facto relationship. - Whether such marriage was a contrived marriage. - De facto relationship was of a short duration. - Respective contributions of parties.
LEGISLATION CITED:	Property (Relationships) Act 1982 (New South Wales)
CASES CITED:	Baumgartner v Baumgartner (1987) 164 CLR 137 Davey v Lee (1990) 13 FamLR 688 Muschinski v Dodds (1985) 160 CLR 583
PARTIES :	Louis Saba Ai Ying Xu
FILE NUMBER(S):	SC 3113/02
COUNSEL:	Ms P. Carr (Plaintiff) Ms P. Nash (Defendant)
SOLICITORS:	Carters Law Firm (Plaintiff) J Kartsounis & Co (Defendant)

- 32 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

MASTER McLAUGHLIN

Tuesday, 28 September 2004

3113/02 LOUIS SABA -v- AI YING XU

JUDGMENT

1 MASTER: By statement of claim filed on 12 June 2002 the Plaintiff Louis Saba claims relief pursuant to the Property (Relationships) Act 1982 and relief in respect to an asserted resulting trust and in respect to an asserted constructive trust. On 11 November 2003, Justice Palmer, by consent, ordered that the claims of the Plaintiff in respect to such trusts be heard and determined before a Master.

2 The Plaintiff asserts that he was in a de facto relationship with the Defendant Ai Ying Xu from about May 1999 until 17 March 2002. During that period a house property situate at and known as 22 Koala Road, Greenacre (“the Greenacre property”) was purchased in the name of the Defendant. The purchase price of $224,000 was, according to the Plaintiff, funded by contributions from the Plaintiff by way of loans obtained by him from his sister Lina Chami of $27,947.88 (towards the purchase price) and $2,168.10 for stamp duty, and by way of a contribution of $20,000 from the Defendant. The balance of the purchase price was raised by way of a housing loan from Perpetual Trustees of Victoria Limited, secured by mortgage, in an amount of $178,075.50.

3 According to the Plaintiff, shortly before the exchange of contracts on the purchase of the Greenacre property, the Plaintiff, at the behest of the Defendant, agreed that the property would be registered in the name of Defendant alone. That was, in fact, done, the Defendant being registered as proprietor and as mortgagor.

4 The Defendant concedes that from May 1999 to 9 August 2001, the Plaintiff resided with her at rented premises at 7/55 Fairmont Street, Lakemba, and subsequently, from 9 August 2001 to 17 March 2002 at the Greenacre property. The Defendant’s son was residing with her throughout those periods. The Defendant, however, denies that she and the Plaintiff ever lived in a de facto relationship.

5 It is asserted by the Plaintiff that he made financial contributions towards the purchase of the Greenacre property, that he purchased various items of furniture and other household chattels for that property, and that he contributed his personal efforts towards renovations and improvements of that property.

6 The Plaintiff did not pay any rent or occupation fee whilst he was residing with the Defendant in the Greenacre property. However, he asserts that he contributed towards the household expenses.

7 At the commencement of the alleged relationship the Plaintiff, who stated that his occupation was that of a self-employed handyman, was in receipt of benefits from Centrelink, in an amount of $376 a fortnight (I assume some form of a disability benefit). He also performed light duties and casual work at a service station at Campsie, for which he alleged that he earned up to $400 - $500 a week. The Plaintiff said that he had been involved in two motor vehicle accidents, on 25 August 1995 and 21 March 1998, and in a work related accident on 23 June 1998.

8 At the time when he commenced to reside with the Defendant the only substantial asset of the Plaintiff was an expectation that he would receive a lump sum payment as compensation for the injuries which he had sustained as a result of the foregoing accidents.

9 According to the Plaintiff, at the time when they commenced to reside together he provided furniture and furnishings for himself and for the Defendant. Those items of furniture and furnishings included a new bedroom suite, a new refrigerator, a new large television and a smaller older television, a smaller television stand, a sound system, and a microwave oven. The costs of those various items are set forth in the statement of claim.

10 According to the Plaintiff, he was enabled to make the foregoing contributions towards the residence of himself and the Defendant as a result of borrowings from his sister Lina Chami.

11 It was the evidence of the Plaintiff that whilst he and the Defendant were residing in the Lakemba property (in which he said that he had previously been residing before she moved in) the Plaintiff paid the totality of the rent, in an amount of $140 a week. Originally the lease of that property was in the name of the Plaintiff. However, as will later emerge, the terms of that lease were subsequently altered to show the Defendant as lessee. It was not in dispute that it was the Plaintiff who had paid the rental bond.

12 According to the Plaintiff, the Defendant also contributed some items of furniture and furnishings to the relationship, being a sofa, two armchairs, a kitchen table and chairs and what was described as “one larger entertainment unit”. In 2001, the Plaintiff’s personal injury claims were finalised. In May of that year he received a payment of $6,412.80 from the Health Insurance Commission. In July 2001, he received a payment of $21,907.93 from his Solicitors. In November 2001, he received a payment of $3,000 from Health Insurance Commission. I would observe that it is difficult to correlate those payments with the various motor vehicle and work-related accidents in which the Plaintiff asserted he had been involved. Some assistance in this regard may, however, be obtained from the various documents which were tendered as exhibit F. Those documents are as follows:

(a) Terms of settlement in proceedings 4821 of 1998 in the District Court of New South Wales at Sydney, Motor Accidents List, dated 14 February 2001, by which there was judgment for the present Plaintiff in the sum of $55,000 inclusive of costs.
(b) Terms of settlement in proceedings 4382 of 1999 in the District Court of New South Wales at Sydney, dated 14 February 2001, by which there was judgment for the present Plaintiff in the sum of $30,000 inclusive of costs for personal injuries.
(c) Short Minutes of Order in Matter No. 3389 of 2001 in the Compensation Court of New South Wales, dated 22 June 2001, by which the liability of the employer to make weekly payments in respect of the injuries referred to in the present Plaintiff’s Application for Determination might be commuted by the payment of $30,000 in addition to payments already made, the employer to pay the present Plaintiff’s costs as agreed or assessed.

13 Presumably, the difference between the total amount of $115,000 to which the Plaintiff became entitled in respect to the three several proceedings which were disposed of by the foregoing documentation and the total amount of $31,320.73 which the Plaintiff appears actually to have received is a consequence, not only of the costs which were included in the amounts of judgments in the two District Court proceedings, but also the deductions authorised to be made by the appropriate insurer in each of those proceedings. I note, however, that in his oral evidence the Plaintiff under cross-examination stated that he had been involved in four car accidents (not two, as he had asserted in his statement of claim and in his affidavit evidence) and one accident at work. The evidence does not enable me to make any finding as to the precise number of instances in which the Plaintiff sustained personal injuries for which he was entitled to be compensated.

14 It was the case for the Plaintiff that, in addition to the foregoing contributions towards the purchase price and by way of furniture and furnishings, he made direct financial contributions to the Greenacre property by payment for materials used in the effecting of improvements to that property and by payment of subcontractors who were carrying out those improvements. Particulars of those alleged payments are appended to paragraph 11 of the statement of claim.

15 The Plaintiff also asserts that he made substantial non-financial contributions to improvements to the Greenacre property, consisting of general labouring, including assistance with building, tiling, removal of rubbish and cleaning. The Plaintiff also asserts that he made non-financial contributions to the relationship by the performance of housework and of home maintenance duties.

16 Further, it is the case for the Plaintiff that in or about 2001 he made a direct financial contribution to the property of the Defendant by providing her with $11,000 in part payment of the purchase price of a new motor car acquired by the Defendant and of the insurance for such vehicle (being $9,500 in respect to the purchase and $1,500 in respect to the insurance).

17 Further, it is asserted by the Plaintiff that during what is described in paragraph 12 of the statement of claim as “their cohabitation” the Plaintiff also made substantial contributions in the capacity of homemaker. Particulars of those contributions include the fact that from May 1999 until December 2001 they shared the same bed and engaged in sexual relations; that whilst living together they regularly ate meals together; that as a couple they entertained guests both at the Lakemba flat and at the Greenacre property; that they socialised together, dining out, attending parties and other entertainments; further, that the Plaintiff cooked and performed other household duties for the Defendant.

18 The Plaintiff departed the Greenacre property on 17 March 2002. It was his evidence that he left with only one small television, the rest of the foregoing chattels remaining in the Greenacre property, where the Defendant has continued to reside.

19 It was the case for the Plaintiff that as a result of the foregoing financial and non-financial contributions of the Plaintiff the value of the Greenacre property has substantially increased, until it is now worth, according to the statement of claim, about $325,000. At the outset of the hearing it was noted that it was agreed between the parties that for the purposes of the proceedings the present value of the Greenacre property was $335,000. There was no evidence as to the value of that property at 17 March 2002.

20 The Plaintiff at the commencement of the relationship was in receipt of payments from Centrelink in an amount of $376 a fortnight, from May 1999. It is somewhat unclear what was the basis of the Centrelink payments. However, it emerged that at about or shortly before the time when the Plaintiff commenced to reside with the Defendant he had been involved in a number of accidents (allegedly either two or four motor vehicle accidents and one accident in the course of his employment).

21 The Plaintiff was born on 15 November 1965, and is presently aged thirty-eight; whilst the Defendant was born on 15 March 1964 and is presently aged forty.

22 It is relevant to the claim of the Plaintiff that in January 2001 the plaintiff and the Defendant visited China where they remained for about two weeks. During that period the Plaintiff met Wang Mei Lan. Two months later, in March 2001, the Plaintiff and the Defendant again visited China for about two weeks. During that visit the Plaintiff married Wang Mei Lan on 30 March 2001 in Shanghai, the Defendant being present at that ceremony. Subsequently, the Plaintiff’s cousin, Peter Karam, in about January 2002 sponsored the migration to Australia of Wang Mei Lan.

23 It has already been observed that the Plaintiff asserts that upon the termination of the relationship and his departure from the Greenacre property he took with him only one small television. However, the Defendant has filed a cross-claim which asserts that she was the owner of various chattels (being a videocassette player, a Sony Playstation, massage machine and children’s sleeping bag), and that on 17 March 2002 the Plaintiff wrongfully removed those items from the Defendant’s possession and has subsequently refused or neglected to return them to the Defendant. By his defence to cross-claim the Plaintiff said that he had purchased those items and was the sole owner thereof; he admitted removing them from the Greenacre property, but denied that such removal was unlawful; and he admitted to not having returned those items, since he was the asserted owner thereof.

24 By her defence the Defendant denies most of the allegations made by the Plaintiff in his statement of claim. Especially does she deny the existence of a de facto relationship between the parties, and the alleged financial and non-financial contributions of the Plaintiff. Paragraph 9 of the defence contains the statement that

“The Defendant borrowed funds directly from the Plaintiff to be put towards the purchase. The Defendant contributed $20,400 directly towards the purchase.”

25 I have had the benefit of receiving written outlines of submissions from Counsel for the respective parties. Those documents will be retained in the Court file.

26 It will be appreciated that in order to ground his entitlement to an order pursuant to section 20 of the Property (Relationships) Act, adjusting the interests of the parties in property (in particular in the Greenacre property) - but not to ground an entitlement to relief in respect to an asserted resulting trust or an asserted constructive trust - the Plaintiff must establish that a de facto relationship obtained between the parties. Section 4(1) of the Property (Relationships) Act defines a de facto relationship as follows:

For the purposes of this Act, a de facto relationship is a relationship between two adult persons:
(a) who live together as a couple, and
(b) who are not married to one another or related by family.

27 Subsection (2) of the section lists, but not exhaustively, various matters which may be taken into account in determining whether two persons are in a de facto relationship.

28 I shall shortly refer in detail to a number of those matters. However, I should here also observe that subsection (3) of section 4 provides,

No finding in respect of any of the matters mentioned in subsection 2(a) - (i), or in respect of any combination of them, is to be regarded as necessary for the existence of a de facto relationship, and a court determining whether such a relationship exists is entitled to have regard to such matters, and to attach such weight to any matter, as may seem appropriate to the court in the circumstances of the case.

29 Since many of the allegations of the Plaintiff concerning matters relevant to the existence of a de facto relationship between himself and the Defendant were totally and absolutely denied by the Defendant, and since in many instances the evidence concerning such disputed matters consisted solely of the uncorroborated testimony of the Plaintiff on the one hand and of the Defendant on the other, it is appropriate that I should express my views concerning the credibility of each of those persons, and the reliance which the Court should place upon the uncorroborated testimony of each.

30 I regarded the Plaintiff (who gave his evidence through an Arabic interpreter) as a totally unreliable and untrustworthy witness. When under cross-examination he was asked concerning his earnings and concerning the source of moneys (asserted by him to be in amounts of up to $500 a week) which he alleged that he paid to or for the Defendant during the course of the relationship, the Plaintiff’s responses were totally evasive. His evidence concerning the number of accidents in which he was involved and in respect of which he either became entitled to compensation or became entitled to receive social security payments was quite inconsistent with the assertion made by him in the statement of claim that he had been involved in two motor vehicle accidents, on 25 August 1995 and 21 March 1998 and a work accident on 23 June 1998 (paragraph 6) and with his affidavit evidence to like effect (affidavit of 7 June 2002, paragraph 5). The Plaintiff stated that he did not know whether he had been claiming social security payments at least since 1998.

31 The Plaintiff’s oral testimony under cross-examination concerning his savings was quite unbelievable. Although to that point the Plaintiff had asserted that his primary source of income was from social security payments received from Centrelink, and that he was also working four hours a day on light duties, he said under cross-examination (T26 - 28) that he did not know what he was earning in 2001, that he could not tell whether he had any assets in 2001, but that he was able to save $10,000. He said that he saved that money so that he could spend it for holiday or for something else and for his funeral. Somewhat earlier in his cross-examination he had said that he had saved the money and used it to purchase a car for the Defendant. Whether or not the Plaintiff was working when he allegedly saved the amount of $10,000 was most unclear.

32 However, the Plaintiff then said that he saved whatever money he did in fact save in a moneybox. There had been no earlier reference to such moneybox, in which the Plaintiff now said that he collected one dollar and two dollar coins. He then said that he had two moneyboxes, one of them containing about $4,000, and the other containing about $7,000 in currency notes, and that the contents of one was taken by the Plaintiff’s son to China, whilst the contents of the other was used for motor car insurance. At the conclusion of the cross-examination on this topic the Plaintiff then asserted that the amount which he had by way of savings and at the commencement of his relationship with the Defendant and which he had spent on the Defendant’s son was $50,000 or “maybe $100,000”.

33 The Plaintiff had said nothing in his affidavit evidence about savings maintained by him in one or more moneyboxes or in amounts of $50,000 or $100,000. I do not believe the Plaintiff’s evidence concerning $50,000 or $100,000 by way of savings in cash. If, however, the Plaintiff had savings in such an amount, or amounts, the source has not been disclosed, and the fact that the Plaintiff was receiving social security benefits from Centrelink at the time when he was able to save such amounts, reflects very badly upon the Plaintiff’s credit.

34 Another area of evidence to which I should refer in respect to the reliability to be placed upon the Plaintiff’s evidence relates to his marriage in China on 30 March 2001. Either that was a genuine marriage or it was a contrived marriage. The material produced on subpoena by the Department of Immigration and Multicultural Affairs (exhibit 1) supports the conclusion that it was a contrived marriage. That certainly was the view of the appropriate officers of the Department. The Plaintiff asserted that he did not even know the name of his wife. The Plaintiff’s story about not appreciating until afterwards that he had undergone a marriage ceremony is incredible. The Plaintiff had originally made an application to sponsor his wife to come to Australia under the appropriate visa. However, he withdrew that sponsorship on 17 May 2002.

35 The entirety of the evidence concerning the marriage of the Plaintiff in China reflects very poorly upon him. Either he knew that he was participating in a contrived marriage, in which case he may have committed a criminal offence. Or he did not know that he was participating in a marriage, in which case he must be regarded as unbelievably stupid and naïve. The responses of the Plaintiff under cross-examination concerning his sponsorship application for his wife revealed a most cavalier and irresponsible approach to this topic.

36 Of course, it is a concomitant of a conclusion that the marriage was a contrived marriage that the Defendant participated in this enterprise. She acknowledged that she was the go-between. She is just as blameworthy as the Defendant and her participation in the entire enterprise reflects no credit upon the Defendant either.

37 It should also here be recorded that at the time when he was being cross-examined concerning the Lakemba premises the Plaintiff gave vent to what was totally inappropriate laughter.

38 The foregoing aspects of the evidence of the Plaintiff are some of the matters which have resulted in my conclusion that the Plaintiff was a totally unreliable witness. It is difficult to resist the conclusion that in many instances the Plaintiff chose deliberately not to respond to questions asked of him.

39 The fact that I do not believe the Plaintiff in many areas of his unsupported evidence which are inconsistent with the evidence of the Defendant does not mean that I necessarily accept the Defendant’s evidence where it also is uncorroborated. I did not regard the Defendant as being a particularly reliable witness. She gave her evidence through a Mandarin interpreter. When questioned under cross-examination about inaccuracies concerning her income which appeared in her loan application for motor vehicle finance (exhibit Q) the Defendant admitted that she had told a lie on that form. She also admitted that she had told a lie on the same document concerning the location where the Plaintiff was residing.

40 As I have already recorded, I consider that the Defendant’s involvement in the contrived marriage of the Plaintiff to Ms Wang Mei Lan reflects poorly upon the Defendant.

41 It also reflects poorly upon the reliance to be placed upon the Defendant’s evidence and upon her standards of honesty that she had informed Centrelink that she was residing alone in the Lakemba property whilst at that very time the Plaintiff was residing there with her. Her purpose in that lie was to obtain an increase in her social security payments to which she was not entitled.

42 I shall now return to the question of the existence of de facto relationship between the parties, and to the various matters referred to in section 4(2) of the Act, which the Court should take into account in determining whether two persons are in a de facto relationship. Those matters include:

(a) The duration of the relationship

43 In the instant case it is not in dispute that the parties resided together from May 1999 until 17 March 2002, that is, for a period of almost three years. If a de facto relationship obtained between the parties, then it lasted no longer than that period of two years and ten months.

(b) The nature and extent of common residence.

44 The parties resided in a common residence for the entirety of the foregoing period of two years and ten months, in rented accommodation at Lakemba for a period of two years and three months, and then at the Greenacre property for a period of a little over seven months.

(c) Whether or not a sexual relationship exists.

45 It was asserted by the Plaintiff that a sexual relationship existed between the parties throughout the entirety of the foregoing period whilst they were residing together from May 1999 until March 2002. The Defendant, however, whilst conceding that the parties engaged in sexual relations, disputed the period of that activity, asserting that it was from May 1999 until August 2000, a period of fifteen months (paragraph 12.1(a) of her defence).

46 However, the Defendant under cross-examination (T, 14 April 2004, 1) said that she had informed the officers of the Department of Immigration and Multicultural Affairs on 17 May 2002 that she had had sexual relations with the Plaintiff for the last year and a half (that is, for the year and a half preceding 17 May 2002). I gather that that means that she intended those officers to understand that she had been having sexual relations with the Plaintiff from the latter part of 2000. That response was not consistent with the statement attributed to the Defendant by John Lane-Brown, an officer of the Department, in his communication of 20 May 2002 to Susan Forth, another officer of the Department, located in Shanghai (exhibit M). That communication attributes to the Defendant a statement that she and the Plaintiff had not been in a de facto relationship for some time, but that she and the Plaintiff had been in a de facto relationship for about one and half years, mentioning the year 1999, but not saying whether that was when the relationship had started or when it had ended.

47 The Defendant was cross-examined concerning the foregoing inconsistencies between what she said she told the investigating officers from the Department and what appears in the report which is exhibit M (that being a report prepared by the appropriate officer of the Department three days after his visit to the Defendant at the Greenacre property). It was suggested to the Defendant that she changed her story concerning the nature of her relationship with the Plaintiff (from being a de facto relationship to a relationship where they merely resided together and at times participated in sexual activities) after the Plaintiff filed his statement of claim on 12 June 2002, less than a month after the visit to the Defendant from the officials of the Department.

48 The suggestion on the part of the Defendant that the relationship of a sexual nature with the Plaintiff came to an end in August 2000 is inconsistent with the evidence which she gave in proceedings before the Local Court at Bankstown on 18 November 2002 (exhibit O). Under cross-examination on that occasion the Defendant was asked whether at the time when the Plaintiff departed the Greenacre property she was still having sexual relations with him. Her response (which was given in English and not through an interpreter) was somewhat confused, but included the passage, “No, I won’t (?) continue from the, from the Lakemba because from – or from August in 2002, I already told him I want to finish everything and I want to move out and he said to me, he want to move out … “(page 74).

49 It is difficult to reconcile the date of August 2002 used by the Defendant in her foregoing response with the fact that by then the present proceedings had already been instituted some two months earlier. Nevertheless, an earlier response by the Defendant also referred to August 2002. She said (at 72) “From August 2002 I said to him “I don’t want to – everything finished and I want to move out”.” She later said (at 74) “No I was – told him we’re finished from the August in 2002”.

50 Since the incident which was the subject of the Local Court proceedings occurred only on 22 February 2002, the references in the Defendant’s evidence thereat to a termination of the relationship with the Plaintiff in August 2002 seem quite illogical. It is possible that the Defendant intended to refer to August in another year, but her evidence, which in these passages was given in English, made references to August 2002 on at least three separate occasions.

51 It is relevant in this regard to refer to the evidence by and concerning Mr. John Malki. According to the Defendant she was involved in a sexual relationship with Mr. Malki from August 2000. However, when asked about Mr. Malki during the Local Court proceedings at Bankstown (Mr. Malki being referred to in the Defendant’s evidence as a “very close friend”(page 74)), the impression given by the Defendant’s evidence is that she did not enter into a relationship with Mr. Malki until after August 2002. The evidence of Mr. Malki himself given in the present proceedings was that he met the Defendant in 1997 and from then their friendship grew stronger, until by mid-2000 they “enjoyed a very close friendship”. In August 2001 Mr Malki commenced advancing to the Defendant various sums of money, averaging about $1,000 a month. He also commenced paying the car lease on the Defendant’s motor car in the sum of $700 a month. According to Mr. Malki’s recollection it was in late 2000 that he and the Defendant commenced a sexual relationship, which has continued, in his words as “a romantic and sexual relationship”. Mr. Malki said that he and the Defendant have not and do not cohabit and that they are not in a de facto relationship.

52 The fact that the Defendant and Mr. Malki may have engaged in sexual activities or, in the words of Mr. Malki, may have been in a “romantic and sexual relationship” does not of itself preclude the existence of a de facto relationship between the Plaintiff and the Defendant.

53 It is quite apparent that a sexual relationship existed between the parties at least from May 1999 until August 2000 (as conceded by the Defendant) and probably until March 2002 (as asserted by the Plaintiff).

d) The degree of financial dependence or interdependence, and any arrangements for financial support, between the parties.

54 There was no intermingling of finances between the parties. Neither did they conduct any joint bank accounts. Nevertheless, there was a considerable degree of financial involvement between them. It was not in dispute that the Plaintiff had caused a significant sum to be advanced towards the purchase of the Greenacre property. Indeed, the Defendant signed an acknowledgment dated 8 August 2001 (exhibit G), that she had received $25,947.88 from Lina Chami, the sister of the Plaintiff. That acknowledgement is consistent with a letter which was subsequently sent on August 2003 by J Kartsounis and Co., the Solicitors for the Defendant, to Carters Law Firm, the Solicitors for the Plaintiff (exhibit L), which refers to the foregoing acknowledgement, and to the indebtedness of the Defendant to Lina Chami in that amount. Similarly, the Plaintiff asserted that from May 1999 until 9 August 2001 he paid the rent of $140 a week for the Lakemba flat, and that from 9 August 2001 until 17 March 2002, the Plaintiff gave his entire benefits from Centrelink to the Defendant for the purpose of paying one half of the mortgage repayments. In paragraph 11.1(a) of her defence, the Defendant said that the Plaintiff paid $70 a week for the Lakemba flat from May 1999 to August 2000, and denied that the Plaintiff gave his entire benefits from Centrelink to her for the purpose of paying his half of the mortgage repayments.

55 In August 2000 the terms of the lease of the Lakemba flat were altered to show the Defendant as the lessee. The Defendant then informed Centrelink that she was living there alone from that time. That false statement to Centrelink, which enabled the Defendant to receive an additional amount of nearly $40 a fortnight to which she was not entitled, reflects poorly upon the credit of the Defendant, as well as constituting a fraud by the Defendant upon the public purse.

56 Even if I do not accept that the Plaintiff paid the entirety of the rent of the Lakemba flat for the entire period of their conjoint occupancy thereof, it is not in dispute that at least until August 2000 the Plaintiff was paying at least one half of that rent. Although denied by the Defendant, I consider it to be an appropriate inference that for the remainder of the time the parties occupied the Lakemba flat the Plaintiff continued to contribute at least one half of the rent.

57 In his statement of claim (paragraph 11(c)) the Plaintiff alleged that he had made direct financial contributions to the Greenacre property by payment for materials used in the construction of improvements to the property and payment of subcontractors who were contracted to carry out the improvements. The particulars disclose such alleged payments as totalling $41,366. Of all those alleged payments the Defendant admitted only one item, being a TV antenna, in an amount of $80. She denied that the Plaintiff had made any of the other payments alleged by him.

(e) The ownership, use and acquisition of property.

58 It has already been observed that the Plaintiff asserts that the Greenacre property was to be held conjointly by himself and the Defendant, but that at the last minute the name of the Defendant alone was placed on the title to that property. However, it was the evidence of the Plaintiff that he had made significant non-financial contributions towards the maintenance and improvement of the Greenacre property during the period whilst he was in residence therein and that he had contributed the totality of his Centrelink payments (in an amount unquantified) towards the mortgage payments on that property. The Defendant denied those assertions.

(f) The degree of mutual commitment to a shared life.

59 It was conceded by the Defendant that even after August 2000 she continued to visit the Plaintiff’s family; that she visited his sister Lina Chami and her husband George and their four children at Belmore on an average of once a month after August 2000; and that she also visited the Plaintiff’s mother. Further, she conceded that after August 2000, she and the Plaintiff went out to parties together, although she qualified that concession by saying that it was only to parties of the Plaintiff’s relatives. The Plaintiff and the Defendant travelled overseas, to China, on two separate occasions.

(g) The care and support of children.

60 No children were born to the relationship of the Plaintiff and the Defendant. However, for a period whilst they were living together the Defendant’s son also resided with them, and formed part of the family unit.

(h) The performance of household duties.

61 Despite the denials of the Defendant in that regard, I am satisfied that the Plaintiff did perform some household duties in respect to the maintenance of the Greenacre property, although the extent of those activities performed by the Plaintiff may have been exaggerated.

(i) The reputation and public aspects of the relationship.

62 I have already referred to the fact that the Plaintiff and the Defendant went out together, visiting kinsfolk of the Plaintiff. Evidence was given by a number of those kinsfolk of the Plaintiff in support of the Plaintiff’s assertions concerning visits by the Plaintiff and the Defendant to members of the Plaintiff’s family. The Defendant did not dispute such visits, and, as I have already recorded, even after August 2000, she continued to maintain what could be described as a social relationship not only with the Plaintiff but also with his relatives.

63 Further, the Defendant obtained an Interim Apprehended Violence Order on the basis that she was or had been the de facto partner of the Plaintiff. The Defendant in support of an application for an Apprehended Violence Order against the Plaintiff made a statement to the Police on 22 February 2002 (exhibit N). An Interim Apprehended Violence Order was made in the Local Court at Bankstown on 19 August 2002. The Protected Persons named in that order were the Defendant and Xiao Wang (a male whose date of birth is shown as 3 July 1989 and who I understand to be the son of the Defendant). The relationship between the parties is shown in that order as follows,

The protected person (or one of them) has or had a de facto relationship with the defendant.

64 It is also relevant to the public aspects and reputation of the relationship between the Plaintiff and the Defendant that during the incident with Mr. Malki on 22 February 2002 which gave rise to the proceedings in the Local Court at Bankstown on 18 November 2002, it was admitted by both the Defendant and Mr. Malki that the Plaintiff said, “Leave my wife’s car”, referring to the Defendant and her motor vehicle.

65 The conduct of the Plaintiff in entering into the contrived marriage at the behest of the Defendant (she having been the go-between in respect to that marriage) seems peculiar and on its face might be regarded as being inconsistent with a de facto relationship between the Plaintiff and the Defendant. Further, I regarded as strange the response given by the Plaintiff under cross-examination that, when the Defendant requested him to marry Wang Mei Lan, the Plaintiff did so because he loved the Defendant.

66 Taking into consideration all the foregoing matters I am satisfied on the balance of probabilities that a de facto relationship did obtain between the Plaintiff and the Defendant whilst they were residing together from May 1999 until 17 March 2002.

67 Section 20(1) of the Property (Relationships) Act provides,

On an application by a party to a domestic relationship for an order under this Part to adjust interests with respect to the property of the parties to the relationship or either of them, a court may make such order adjusting the interests of the parties in the property as to it seems just and equitable having regard to:

(a) the financial and non-financial contributions made directly or indirectly by or on behalf of the parties to the relationship to the acquisition, conservation or improvement of any of the property of the parties or either of them or to the financial resources of the parties or either of them, and
(b) the contributions, including any contributions made in the capacity of homemaker or parent, made by either of the parties to the relationship to the welfare of the other party to the relationship or to the welfare of the family constituted by the parties and one or more of the following, namely:
(i) a child of the parties,
(ii) a child accepted by the parties or either of them into the household of the parties, whether or not the child is a child of either of the parties.

68 The phrase “domestic relationship” is by section 5(1) of the Act defined to include a de facto relationship.

69 In approaching the claim for adjustment of interests of parties in property pursuant to section 20(1) of the Property (Relationships) Act, the Court makes a wholistic judgment and should not attempt to evaluate the respective contributions of the parties as if it were undertaking a reductionist process analogous to the taking of partnership accounts (notoriously one of the most time consuming and expensive of litigious exercises). (See Davey v Lee (1990) 13 FamLR 688).

70 A significant part of the Plaintiff’s claim to an interest in the Greenacre property is grounded upon the funding of the purchase price of that property. The wording of paragraphs 8 and 9 of the statement of claim would suggest that the Plaintiff himself contributed $27,947.88 towards the purchase price and contributed an additional $2,168.10 for stamp duty. He obtained those amounts by way of borrowings from his sister, Lina Chami. However, the Plaintiff’s affidavit of 7 June 2002 states that it was Mrs Chami herself who paid those amounts, as well as paying an amount of $2,000 towards the deposit of $22,000.

71 In her affidavit of 14 June 2002 Lina Chami states that she

“loaned my brother $2,000 towards the balance of the deposit moneys required on exchange of contracts. I later paid $2,168.10 for the stamp duty. Prior to the settlement I paid an additional sum of $25,947.88 being the balance of the moneys required for settlement.”

72 Subsequently on 8 August 2001 the Defendant provided the advance of $25,947.88 (exhibit G). That acknowledgement also stated that the Defendant “will enter into a loan agreement supported by a mortgage and a caveat to honour my obligation under this agreement”. Subsequently Mrs Chami lodged a caveat on 9 January 2002 in respect to the Greenacre property, asserting as to the nature of the estate or interest in the land, an

“Equitable interest with respect to moneys paid by the caveator for the purchase of the property and renovations”

73 Under the printed words “by virtue of the instrument referred to below/facts stated below:” appear the words “The caveator paid monies [sic] for the purchase of the property and renovations”. That caveat subsequently lapsed.

74 I have already referred to the letter of 20 August 2003 from the Solicitors for the Defendant to the Solicitors for the Plaintiff (exhibit L). That letter refers to the foregoing acknowledgement and includes the following,

We are instructed that our client approached Lena Chami in January 2002 in relation to repaying moneys owing and that Lena Chami stated, inter alia, that she didn’t want the money.
Our client has at all material times been prepared to repay the moneys that she acknowledges as owing to Lena Chami. We note that Lena Chami has sworn a number of affidavits on behalf of her brother, Louis Saba, the Plaintiff in the proceedings against our client. Lena Chami has annexed to her affidavit sworn 14 June 2002 a handwritten acknowledgement in respect of the sum of $25,947.88, such acknowledgement dated 8 August 2001.
We are instructed that no formal demand has ever been made by Lena Chami for repayment of these moneys.

75 In her affidavit of 7 November 2003 Mrs Chami gives further details of the circumstances in which she advanced the foregoing moneys to the Defendant. That affidavit evidence is to the effect that she was requested by the Plaintiff, in the company of the Defendant, to do so, because of the delay in the Plaintiff receiving his compensation moneys, and that the Plaintiff said that he would repay Mrs Chami when he received his compensation moneys.

76 Each of the Plaintiff and Mrs Chami was cross-examined concerning the funding of the purchase of the Greenacre property. Some of the responses given by the Plaintiff seemed inappropriate and somewhat peculiar. For example when it was suggested to him that, essentially, his only involvement in the purchase was offering to lend the Defendant the additional money needed to make up the 20 percent deposit. The Plaintiff’s reply included, “I lent her the money because Linda [the Defendant] wouldn’t think of buying in the property. So what I did was to buy the house for myself”. When it was suggested to him that if that had been the case he could have had his name placed on the title, he replied,

No, I was entitled. I had $30,000 and I can borrow $20,000 from my brother and money from others. I can buy with this money the best house.

77 Mrs Chami (who also gave her evidence through an Arabic interpreter) was asked about the statement in her affidavit of 14 June 2002 (paragraph 8) that the Plaintiff had “not repaid the moneys he borrowed from me”. Essentially, it was the evidence of Mrs Chami that she handled the moneys which the Plaintiff received by way of compensation. She said that she deposited some of those compensation moneys in the Plaintiff’s bank account and some in her own bank account.

78 Mrs Chami under cross-examination denied that the Defendant had offered to repay the moneys which Mrs Chami had advanced or that Mrs Chami had said that she did not want those moneys to be repaid.

79 The Defendant by her defence, denied any agreement by herself and the Plaintiff to purchase the Greenacre property and said that it was purchased by the Defendant alone. According to the Defendant, the only involvement of the Plaintiff was that she borrowed funds from him “to be put towards the purchase”.

80 In her affidavit of 12 March 2003 the Defendant sets forth, in paragraph 2(8), how the purchase price of $224,000 for the Greenacre property was funded, being

(1) a loan form Perpetual Trustees Victoria Limited in the sum of $179,000.
(2) Moneys contributed by the Plaintiff from his compensation payment - $25,947.88.
(3) Moneys contributed by me being the ten percent deposit in the sum of $22,400.
(4) The sum of $7,000 from the NSW State Government being the First Home Buyer’s Grant which was paid to me.

81 The Defendant acknowledged that Lina Chami advanced the sum of $2,000 to make up the deposit of $22,400, that advance being made in cash. The defendant said that she repaid that sum to Mrs Chami approximately a few days later, on or about August 2001, by handing her $2,000 in cash.

82 The Defendant’s affidavit evidence then continued,

I say that the Plaintiff advanced the sum of $25,947.88 of the purchase of the property at 22 Koala Road, Greenacre. The Plaintiff said to me words of the effect “I am lending you this money”. I replied with words to the effect of “I will pay you back”. I did not ever consider that I owed money to Lina Chami. I signed an acknowledgement that I owed money to Lina Chami when I attended her solicitor’s office at Auburn in 2001 and I executed an acknowledgement. Lina Chami said to me “You must sign a document to say that you owe me money” or words to that effect. I was always aware that the money had been contributed by Louis Saba and not Lina Chami. However, I escorted Lina Chami to her solicitor’s office Chahoud Kalouche & Associates at Harris Park and executed the Acknowledgement of Transfer. I knew that Lina Chami controlled her brother’s finances and for that reason I executed the document to the effect that I owed Lina Chami the money notwithstanding the fact that I was aware that the sum of $25,947.88 comprised of the compensation payment paid to the Plaintiff.

83 The Defendant was cross-examined concerning the purchase of the Greenacre property. She acknowledged that it was the Plaintiff who had in fact located that property. The responses given by the Defendant under cross-examination included (T64, line 35)

From the beginning until the end I had always knew that this money belonged to Louis Saba. Only that money was brought over from his sister.

84 It is extremely difficult to reconcile the case for the Plaintiff, as constituted by his statement of claim and the affidavit evidence of Mrs Chami, with the evidence given under cross-examination by each of those two witnesses. The affidavit evidence of the Defendant appears to be largely consistent with her defence and with her responses under cross-examination. The attempt to reconcile the foregoing inconsistencies in respect to the case for the Plaintiff, and an attempt make findings in the light of the denials by the Defendant of most of the evidence on behalf of the Plaintiff are made more difficult by my view, already expressed, that I considered neither the Plaintiff nor the Defendant to be a reliable or a trustworthy witness.

85 What appears to emerge, however, is that whatever funds were advanced to the Defendant (and she acknowledges the amount of $25,947.88) were funds which both she and the Plaintiff regarded as being beneficially owned by the Plaintiff, although paid by the medium of the Plaintiff’s sister Mrs Chami. The reasons offered for the involvement of Mrs Chami were (according to the Plaintiff and Mrs Chami and the Defendant) that Mrs Chami handled all the Plaintiff’s money and (according to Mrs Chami and the Defendant) that at the time when these funds were needed by the Defendant the Plaintiff’s settlement moneys from his various compensation claims had not yet arrived.

86 Whichever be the reason, however, it seems obvious that, had it not been for the relationship (which I have now held to be a de facto relationship) between the Plaintiff and the Defendant, those funds would not have been advanced to the Defendant. Although there appears to have been a degree of friendship between the Defendant and Mrs Chami, it does not appear to be being suggested by anyone that, had the Plaintiff not been involved, Mrs Chami would have advanced, or lent, a not inconsiderable amount of money to the Defendant to assist the Defendant in funding the purchase of a house.

87 It is also appropriate here to record that Mrs Chami in her affidavit evidence stated that she had been advised by Mr. David Hansen, the Solicitor for the Plaintiff to seek independent legal advice, and that she was provided with such independent legal advice by Mr. Lawrence Tanna, solicitor, on 6 November 2003, but that she did not wish to become a party to the present proceedings.

88 It seems reasonably clear, therefore, that the foregoing amount of $25,947.88 constituted an indirect contribution by the Plaintiff towards the acquisition of the Greenacre property.

89 In this regard I should, for completeness, observe that if the foregoing amount was, as asserted by the Defendant, a loan (the acknowledgement, exhibit G, recognising the Defendant’s indebtedness to Mrs Chami), the Defendant has nevertheless failed to repay this amount. The suggestion, made in submissions, that the existence of Mrs. Chami’s caveat over the Greenacre property has prevented the Defendant from being able to raise sufficient finance to repay the loan does not appear to me to be an adequate explanation for this omission on the part of the Defendant. The caveat has long since lapsed, and the Defendant has made no attempt to offer repayment.

90 The Defendant produced, and had admitted into evidence, a considerable quantity of receipts and invoices in respect to work done on the Greenacre property and materials purchased for the improvement of that property. All those receipts and invoices were in the name of the Defendant. However, that fact does not of itself disprove the assertions of the Plaintiff that he made cash contributions to the foregoing purchases, by giving the necessary money in cash to the Defendant.

91 Once again, in the light of the unsupported oral testimony of the Plaintiff in this regard and the denials of the Defendant, which denials are supported by documentary material showing payments made by the Defendant, and in light of my views concerning the reliance to be placed upon the evidence of either of those parties, it is difficult to make findings in this regard. Nevertheless, on the balance of probabilities it would appear that the Plaintiff made some contributions towards the various payments and purchases in respect to the Greenacre property. However, those contributions were probably considerably less than alleged by the Plaintiff. In this regard it must be borne in mind that the Plaintiff’s only legitimate sources of income were some form of disability pension, in a quite small amount, from Centrelink, and some form of income from four hours of intermittent work, in an amount which the Plaintiff asserted to be up to $400 - $500 a week. If the Plaintiff was in fact earning such amounts, then it is quite clear that he was defrauding Centrelink. That fact of itself reflects very poorly upon the Plaintiff’s standards of honesty, and enforces my view that the Plaintiff was a totally unreliable and untrustworthy witness.

92 In summary, concerning the Greenacre property, it would appear that the contributions towards the purchase price made on behalf of the Plaintiff (by the advances from Mrs Chami) were about equal to those made by the Defendant, or perhaps a little more than those made by the Defendant. The payments by way of mortgage repayment and by way of improvements were more or less equal.

93 Similarly, I am satisfied that the Plaintiff made contributions by way of physical activities and labour to the maintenance and improvement of that property.

94 Just as the Plaintiff had contributed to at least one half of the rent of the Lakemba property, I am satisfied that he continued to make contributions in an equivalent amount to the mortgage payments on the Greenacre property.

95 The Court should not, however, overlook the fact that the relationship was of an extremely short duration, being only two years and ten months. Although it passed the threshold of two years required by section 17(2) of the Act, it cannot by any means be regarded as a long-term relationship. Further, that the Greenacre property was purchased towards the end of the relationship. Neither should it be overlooked that whatever contributions the Plaintiff made towards the conservation or improvement of the Greenacre property were contributions made towards what was throughout that period the residence of the Plaintiff.

96 The Plaintiff sought an order that he receive a 70 percent interest in the Greenacre property and that the Defendant should receive a 30 percent interest therein. He has not established that during the period of the relationship he contributed more than one half to the conservation or improvement of that property, or to the outgoings and expenses of either the Greenacre property or the rented property at Lakemba. There has been a significant increase in the value of the Greenacre property since the date of its purchase and the termination of the relationship.

97 In the light of the short duration of the de facto relationship between the parties, and the even shorter period during which the Plaintiff resided in the Greenacre property it seems to me appropriate that the Court should grant relief to the Plaintiff by way of adjustment of interests of the parties, by declaring the Plaintiff to be entitled to an interest as to 30 percent in the Greenacre property and the Defendant to be entitled to the remaining 70 percent interest therein.

98 The Plaintiff has not established the existence of a resulting trust in respect to the Greenacre property, since no part of the purchase price was provided by the Plaintiff. But, even if the moneys advanced by Mrs Chami were to be treated as having been provided by the Plaintiff, the presumption that the Defendant as legal owner held the Greenacre property upon a resulting trust for herself and the Plaintiff in the same proportions as their respective contributions towards the purchase price could be rebutted by the nature of the de facto relationship then obtaining between the parties, which could give rise to a presumption of advancement. Of course, that latter presumption is also susceptible of rebuttal.

99 In the light of my foregoing conclusion that the Plaintiff is entitled to relief under section 20 of the Property (Relationships) Act, it is not necessary for me to proceed to a detailed consideration of the Plaintiff’s claim to be entitled to relief consequent upon the existence of a constructive trust in his favour over the Greenacre property. Even if the Plaintiff were to establish the existence of such a trust, it would not be to the extent of a 30 percent interest in that property. That is because, even if he made the asserted contributions to the conservation and improvement of the Greenacre property, the Plaintiff had the benefit of residing in that property without paying any rent or occupation fee; further, any such contributions were made over a short duration of only seven months.

100 A contribution of $30,000 towards the purchase price of $224,000 (approximately 13 percent of the purchase price), and a contribution of one-half of the mortgage repayments for a period of seven months, even when considered in the context of contributions by way of physical activity towards the conservation and improvement of the property, and certain contributions towards the furniture and furnishings of the property would not of themselves entitle the Plaintiff to an interest as great as 30 percent in the property upon the application of the principles relating to a constructive trust which have been enunciated by the High Court of Australia in such cases as Muschinski v Dodds (1985) 160 CLR 583 and Baumgartner v Baumgartner (1987) 164 CLR 137.

101 I have already observed that by her cross-claim the Defendant seeks the return of four specified chattels (which the Plaintiff asserted he had purchased and had lawfully removed from the Greenacre property). That cross-claim was largely ignored during the course of the hearing. No cross-examination concerning those specified chattels was directed to either party. Neither was the Defendant’s cross-claim the subject of any submissions. I am not satisfied that the Defendant has established ownership of those chattels. In these circumstances, I propose to dismiss the cross-claim.

102 In respect to the chattels which were the subject of relief claimed by the Plaintiff in his statement of claim, I consider it appropriate that each party be declared the beneficial owner of such chattels which were in the possession of that party before the commencement of the de facto relationship or which were acquired or purchased by that party during the course of the relationship. If the parties cannot agree, then, in the case of each individual chattel, whether it was in such possession or whether it was so acquired or purchased, it will be necessary for an enquiry to be conducted in that regard. Accordingly, liberty to apply in respect to such chattels should be reserved.

103 I propose to stand the proceedings over to a date to be fixed by arrangement with my Associate for the bringing in of short minutes in order to give effect to my foregoing conclusions.

104 I have not heard any submissions as to costs. However, I would observe that neither party has succeeded in obtaining the result sought by that party. The Plaintiff claimed a 70 percent interest in the Greenacre property, whilst the Defendant submitted that the Plaintiff’s claim should be dismissed. I have held the Plaintiff to be entitled to a 30 percent interest in the Greenacre property. In all the circumstances, I consider it appropriate that there be no order in respect to costs, to the intent that each party should bear his or her own costs of the proceedings.

105 However, should either party desire an opportunity to submit that there be some other order in respect to costs, such an opportunity will be given.

106 Accordingly, I make the following order:

(1) I stand the proceedings over to a date to be fixed by arrangement with my Associate for the bringing in of short minutes and, if desired, for argument as to costs.

Last Modified: 09/29/2004