Singh v Singh

[2004] NSWSC 109

Reported Decision: (2004) DFC 95-280

Supreme Court

CITATION:	Singh v Singh [2004] NSWSC 109
HEARING DATE(S):	04/02/04, 05/02/04, 06/02/04
JUDGMENT DATE:	3 March 2004
JURISDICTION:	Equity Division
JUDGMENT OF:	Barrett J
DECISION:	Summons dismissed with costs
CATCHWORDS:	TRUSTS AND TRUSTEES - resulting trust - whether money provided by father towards purchase of house by son gave rise to resulting trust in favour of father - whether voluntary transfer of Torrens system land gives rise to resulting trust in favour of transferor - FAMILY LAW AND CHILD WELFARE - domestic relationships - considerations relevant to application for leave to bring Property (Relationships) Act claim out of time
LEGISLATION CITED:	Conveyancing Act 1919, s.44(1) Property (Relationships) Act 1984, s.18
CASES CITED:	Bevan v Fallshaw (1992) 15 Fam LR 686 Bhana v Bhana (2002) 10 BPR 19,545 Calverley v Green (1984) 155 CLR 242 Charles Marshall Pty Ltd v Grimsley (1956) 95 CLR 353 Hayes v Harrison [2002] ACTSC 22 House v Caffyn [1922] VLR 67 Newcastle City Council v Kern Land Pty Ltd (1997) 42 NSWLR 273 Rowland v Ellis (2001) 28 Fam LR 656 Ryan v Hopkinson (1990) 14 Fam LR 151 Wirth v Wirth (1956) 98 CLR 228
PARTIES :	Mahendra Pratap Singh - Plaintiff Manoj Baalman Singh - First Defendant Shareen Lata Singh - Second Defendant
FILE NUMBER(S):	SC 1804/03
COUNSEL:	Mr M K Rollinson - Plaintiff Mr T J Morahan - Defendants
SOLICITORS:	Ramrakha Jenkins - Plaintiff John Spence & Associates - Defendants

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

BARRETT J

WEDNESDAY, 3 MARCH 2004

1804/03 – MAHENDRA PRATAP SINGH v MANOJ BAALMAN SINGH & ANOR

JUDGMENT

1 Mahrenda Pratap Singh and his wife, Bijma Wati Singh, are the parents of Manoj Baalman Singh who is married to Shareen Lata Singh. Mahrenda Pratap Singh is the plaintiff. Manoj Baalman Singh and Shareen Lata Singh are the defendants. Without intending any disrespect and simply to avoid confusion, I shall refer to the parties by their first names, except in the case of Shareen Lata Singh who is called “Lata”.

2 Manoj and Lata became in 1997 the registered proprietors, as joint tenants, of a residential property at Mt Druitt held under the provisions of the Real Property Act 1900. Immediately before that, the registered proprietors had been Manoj and Mahendra as joint tenants. That property was sold in 2002. In order for the sale to be completed, it was necessary for the vendors to negotiate the withdrawal of a caveat lodged by Mahendra. The withdrawal was effected under an arrangement which saw the net proceeds of sale placed in an interest bearing account pending resolution of the claim on which Mahendra based his caveat, namely, a claim to be the owner in equity of an undivided interest in the Mt Druitt property. These proceedings are the vehicle by which that claim is to be determined.

3 Mahendra’s primary claim is a claim based upon the proposition that, at the time of the sale of the Mt Druitt property, a resulting trust subsisted in his favour as to some undivided interest in the property. There is an alternative and subsidiary claim based on the Property (Relationships) Act. The sustainability of Mahendra’s resulting trust claim is founded, in part at least, on two basic propositions: first, that he contributed part of the purchase price of a residential property in Belmore purchased by Manoj in 1985, which contribution continued to be reflected in a proprietary fashion when the Belmore property was later replaced by a property at St Marys which in turn was eventually replaced by the Mt Druitt property; and, second, that each of two instruments executed by Mahendra in 1997 was ineffective to deprive Mahendra of his beneficial interest traceable to the provision of purchase moneys in 1985. Those instruments were an instrument executed by Mahendra in favour of Lata and a subsequent instrument executed by Mahendra and Manoj in favour of Manoj and Lata.

4 The first matter to be considered is the purchase of the Belmore property in 1985. It is common ground that that property was purchased for $60,000, that Manoj became the sole purchaser and sole registered proprietor, that $16,000 of the $60,000 paid by Manoj had been received by him from Mahendra and that the balance of $44,000 was the proceeds of a loan obtained by Manoj alone from the ANZ Bank in respect of which he alone made all payments. Mahendra says that the $60,000 purchase price must be regarded as having been contributed as to $16,000 by him and as to $44,000 by Manoj so that, although title was taken in Manoj’s name alone, a resulting trust arose in favour of Mahendra in such a way that, in equity, the property was owned by Mahendra as to an undivided interest of 16/60ths and by Manoj as to an undivided interest of 44/60ths. Manoj’s contention is that no resulting trust arose in favour of Mahendra and that he (Manoj) was, at all material times, the full legal and equitable owner of the Belmore property. Because this issue plays a central role in the resolution of the overall dispute, I shall deal with it in full before turning to other matters.

5 Mahendra was born in Fiji in 1928. Manoj was born in 1964. Mahendra spent some years in Australia at different stages during the 1950s and 1960s both studying and working. In fact, Manoj was born in Sydney. In 1982, Mahendra arranged for Manoj (then aged 18) to move to Australia permanently. Manoj had completed a trade course in Fiji. He obtained employment in Sydney soon after his arrival. Mahendra bought him a woollen suit, gave him $250 (Fiji) pocket money and paid his fare to Sydney. Mahendra was, at the time, working as a land surveyor employed by the Suva City Council. He owned two properties in Fiji, one being the home of his wife Bijma and himself. Their daughter (the only child in addition to Manoj), born in Fiji in 1957, had married in 1976. Manoj married Lata in 1987 and she went to live with him in the Belmore property purchased in 1985. Mahendra and his wife Bijma made visits to Sydney periodically when Manoj was living at Belmore (as they had done before). During those visits they stayed at the Belmore house.

6 This brief account of key events up to 1987 puts into context the purchase transaction of 1985. There is no doubt that Manoj supplied $44,000 of the $60,000 purchase moneys by borrowing that sum. There are in evidence bank statements for the period 11 August 1987 to 27 May 1988 relating to an account with the ANZ Bank in Manoj’s sole name designated “Housing Loan” and reflecting a debit balance of between $49,000 and $45,000. There is, however, a dispute as to the character of the $16,000 which originated with Mahendra. It is Manoj’s evidence that Mahendra gave him $16,000 while visiting Sydney on one occasion, saying words to the effect:

“This is your share. I have already adequately provided for your sister. You can use this money as you wish.”

7 Mahendra denies this conversation. He says that he did give his daughter and her husband a block of land in Fiji worth about $8,000 (Fiji) as a wedding present and that he paid for their wedding at which there were about 500 guests. He described the gift of the land as “a one off wedding gift to set the couple up”. However, Mahendra says that he did not have any discussion with Manoj about provision he had made for his daughter.

8 Manoj says that he found the Belmore property and decided to buy it. Mahendra says that it was he (Mahendra) who did these things and that he, his wife Bijma and Manoj agreed that it was a good purchase. In his first affidavit, Mahendra said that the property was bought in his name and Manoj’s. To be more precise, he deposed:

“This [Belmore property] was purchased by me in 1986 [sic] and I put the property in the joint names of Manoj and me.”

9 This is not borne out by the documentary evidence which shows that Manoj alone became the registered proprietor. Manoj said in his first affidavit:

“The property was bought solely in my name and it was always my intention to buy the property solely for myself and my future wife to live in.”

10 Manoj conceded in cross-examination that he had no specific marriage plans in 1985 but said that he was thinking generally about getting married and was working towards that goal. Manoj’s evidence just quoted brought the following response in Mahendra’s second affidavit:

“I agree that the property was bought in Manoj’s sole name. There was discussion between me and my wife and Manoj about this property. I said to Manoj ‘I am happy in Fiji at present. However I have brought with me $16,000.00 from Fiji. I would like to buy a property for the family. At the moment we are happy living in Fiji but at some stage your mother and I would like to come and live in Australia. I have the money for the deposit but I cannot pay the mortgage. At the moment you are paying rent and not saving. I suggest we use this $16000.00 as a deposit, and you can live in the house and pay the mortgage instalments.’ Manoj said ‘I agree’. We then discussed in whose name the property should be purchased. Manoj had at first said, ‘I do not want to go into debt’. I persuaded him, ‘It is better than paying rent. You can’t be living on rent all your life’. Manoj finally agreed said ‘Taji (which is a term meaning father) in that case the best thing would be for the property to be in my name. I will look after it and pay the mortgage instalments. It will be our family home in Australia and you and mother can come and live in it with me whenever you come to Australia.’ I consulted George Bassil, solicitor, with Manoj. I recall this because we had to go all the way to Brighton-Le-Sands for the conveyancing. I am not clear who recommended this solicitor to us but I think it was the bank.”

Manoj denies that this conversation took place. Each of Manoj and Mahendra adhered in cross-examination to the version of events given in his affidavit (or, in Mahendra’s case, in the second affidavit).

11 Mahendra’s wife, Bijma, also gave evidence that the $16,000 was given to Manoj to purchase a home for the family. In her affidavit she said:

“In relation to the first property at Belmore, I say I was a party to the discussions between my husband, Manoj and myself. At no stage did I say to anybody or was told that this initial $16,000.00 which my husband brought from Fiji was meant as a gift to Manoj. I recall encouraging Manoj to purchase a property … I say it was a family decision to have the Belmore Street property purchased in the sole name of Manoj. After the purchase, Manoj would say, ‘I am glad we purchased this property. It is so good to have a family home.’ ”

12 In cross-examination Bijma adhered by her affidavit, stating that she and her husband had given Manoj the money so that their son could get a property, “but for us, a family home”.

13 Before dealing with this evidence, I should refer briefly to the well established principles concerning resulting trusts in circumstances such as these, noting, as I do so, that Mr Rollinson of counsel, who appeared for Mahendra, made it clear that the only interest in the Mt Druitt property his client asserted as arising by virtue of a trust derived from a resulting trust and that any such resulting trust was, as it were, derived from a resulting trust in respect of the Belmore property. The basic principle is stated as follows in the judgment of Gibbs CJ in Calverley v Green (1984) 155 CLR 242 at 246:

“Where a person purchases property in the name of another, or in the name of himself and another jointly, the question whether the other person, who provided none of the purchase money, acquires a beneficial interest in the property depends on the intention of the purchaser. However, in such a case, unless there is such a relationship between the purchaser and the other person as gives rise to a presumption of advancement, i.e., a presumption that the purchaser intended to give the other a beneficial interest, it is presumed that the purchaser did not intend the other person to take beneficially. In the absence of evidence to rebut that presumption, there arises a resulting trust in favour of the purchaser. Similarly, if the purchase money is provided by two or more persons jointly, and the property is put into the name of one only, there is, in the absence of any such relationship, presumed to be a resulting trust in favour of the other or others. For the presumption to apply the money must have been provided by the purchaser in his character as such -- not, e.g., as a loan. Consistently with these principles it has been held that if two persons have contributed the purchase money in unequal shares, and the property is purchased in their joint names, there is, again in the absence of a relationship that gives rise to a presumption of advancement, a presumption that the property is held by the purchasers in trust for themselves as tenants in common in the proportions in which they contributed the purchase money: Robinson v. Preston , at p. 213]; Ingram v. Ingram, and Crisp v. Mullings (a decision of the English Court of Appeal).”

14 The presumption of resulting trust arising from the provision of purchase money may be displaced in one of two ways: either by operation of a countervailing presumption of advancement arising from the existence of a particular relationship between the parties or by proof of a contrary intention common to the purchasers (in a case where there are several). Where part of the purchase money for a property purchased by a child (including an adult child) is provided by a parent, a presumption of advancement (that is, that the parent intended to confer a benefit on the child) operates to the exclusion of any presumption of resulting trust unless the presumption of advancement is itself overborne. The position is as described by Deane J in Calverley v Green at 267:

“The third ‘presumption’, usually called the ‘presumption of advancement’, is not, if viewed in isolation, strictly a presumption at all. It is simply that there are certain relationships in which equity infers that any benefit which was provided for one party at the cost of the other has been so provided by way of ‘advancement’ with the result that the prima facie position remains that the equitable interest is presumed to follow the legal estate and to be at home with the legal title or, in the words of Dixon C.J., McTiernan, Fullagar and Windeyer JJ. in Martin v. Martin , at p. 303, that there is an ‘absence of any reason for assuming that a trust arose’. ‘The child or wife has the legal title. The fact of his being a child or wife of the purchaser prevents any equitable presumption from arising’ (quoting Ashburner's Principles of Equity, 2nd ed. (1933), p. 110n).”

This presumption of advancement will not operate and the presumption of resulting trust will be preserved if, on the evidence, it is shown that the parent did not intend to confer a gratuitous benefit on the child.

15 In this case, the relationship between Mahendra and Manoj means that the presumption of advancement operates to forestall any resulting trust unless it is established on the balance of probabilities that Mahendra did not intend to confer a gratuitous benefit upon Manoj by contributing $16,000 of the total sum paid for the Belmore property. Statements in Mahendra’s affidavits and oral evidence as to what his intentions were at the time of the purchase cannot be taken into account except to the extent that they militate against the case he seeks to make: Charles Marshall Pty Ltd v Grimsley (1956) 95 CLR 353. Rather attention must be directed towards such evidence as there is to what was said and done at the time of the transaction. There are no contemporaneous documents. There is only evidence given in affidavits of 2003 and cross-examination in 2004. The caution concerning Mahendra’s evidence must apply also to Bijma’s evidence. Her affidavit and cross-examination only provide similarly non-contemporaneous declarations of the intentions of family members in connection with the purchase of the Belmore property. It follows that, in the absence of other evidence concerning things said and done by relevant persons at the time of the purchase, the presumption of advancement should be taken to prevail. Even if it is accepted that there was reference by Mahendra, Bijma and Manoj at the time of purchase to the Belmore property being “a family home”, the presumption will still operate. An intention that a property be bought as “a family home” says nothing about intention as to ownership as distinct from use.

16 Because, on this finding, Manoj was the sole beneficial owner of the Belmore property, he was solely entitled to the proceeds of the eventual sale of this property. Those proceeds, after repayment of the related debt, were applied towards the purchase of the St Marys property and the balance was obtained by means of a new loan.

17 There are conflicting accounts as to who found the St Marys property and arranged its purchase. This is beside the point. The fact is that it was purchased in late 1988 in such a way that Manoj and Mahendra became registered proprietors as joint tenants. Both also became mortgagors of the property to the ANZ Bank. The transfer and mortgage were registered on 4 October 1998, from which it may be inferred that the purchase was completed and the mortgage given shortly before that.

18 Manoj and Lata say that they were unaware of the fact that Mahendra’s name was on the title and mortgage documents for either the St Marys or Mt Druitt properties. They say that they only became aware of this when their solicitor pointed it out to them in 1997 when a bank was approached for refinancing. This also is beside the point. The important question is as to the beneficial interests that arose upon purchase of the St Marys property.

19 Although Mahendra was, with Manoj, a mortgagor of the St Marys property to the ANZ Bank, the contemporary evidence shows that Mahendra was not a borrower from the bank. There are in evidence two bank statements of relevance. The first is a statement dated 20 March 1989 (that is, some six months or so after completion of the St Marys purchase) reflecting two entries, both on 17 March 1989, resulting in a debit balance of $54,174.21. This statement relates to account No. 2448 05569. The second is a later statement for the same account in which it is identified, under the heading “Account type”, as “Home Loan”. The subsequent statement covers the period September 1989 to March 1990. The two statements for the Home Loan account 2448 05569 identify the account holders as “Singh, Manjo [sic] Baalman” and “Singh, Lata”. I am satisfied that the parties to Home Loan account 2448 0559 were Manoj and Lata. I therefore infer that it was Manoj and Lata who borrowed money from the ANZ Bank in connection with and for the purposes of the St Marys purchase and that the money they thus borrowed was added to the proceeds of the Belmore sale in order to finance that purchase. True it is that the St Marys property, title to which was taken by Manoj and Mahendra as joint tenants, was mortgaged as security for this loan. But that did not make the mortgagors the borrowers or mean that the loan proceeds, when advanced, became the property of the mortgagors. Those loan proceeds, when advanced, were owned by the account holders, Manoj and Lata, who thereby became indebted to the bank, albeit in circumstances where the property to which Manoj and Mahendra took title became security for repayment by Manoj and Lata.

20 This state of affairs makes it necessary to resort to another passage from Calverley v Green (above). Mason and Brennan JJ said (at 257-8):

“It is understandable but erroneous to regard the payment of mortgage instalments as payment of the purchase price of a home. The purchase price is what is paid in order to acquire the property; the mortgage instalments are paid to the lender from whom the money to pay some or all of the purchase price is borrowed. In this case, the price was $27,250, of which $18,000 was borrowed from the mortgagee by the plaintiff and defendant jointly. The balance was paid by the defendant out of his own funds, being part of the proceeds of the sale of the Mount Pritchard property. Thus the plaintiff and defendant both contributed to the purchase price of the Baulkham Hills property. They mortgaged that property to secure the performance of their joint and several obligation to repay principal and to pay interest. The payment of instalments under the mortgage was not a payment of the purchase price but a payment towards securing the release of the charge which the parties created over the property purchased. We would agree with the view expressed by the English Court of Appeal in Crisp v. Mullings , at p. 733, a case in which the material facts are not distinguishable from the present:

‘The situation, in our view, is that the defendant does not establish that he alone provided the purchase-price, any more than he would have, had the whole price been provided by a joint mortgage; and the resulting trust of the whole is therefore not established.’”

21 Mahendra, as I have said, was not a borrower. He therefore cannot be regarded as having contributed to the purchase price. Mahendra’s only role was to allow such interest as he had in the property by reason of being one of two persons registered as proprietors as joint tenants to become security for the loan to Manoj and Lata. That role did not create in Mahendra any beneficial interest in the St Marys property. The legal estate held by Mahendra and Manoj as joint tenants was held upon trust for Manoj and Lata.

22 When the St Marys property was sold, the net proceeds, after satisfaction of the bank debt, were applied towards purchase of the Mt Druitt property. The only persons with beneficial interests in those net proceeds were, on the above analysis, Manoj and Lata. The Mt Druitt property, like the St Marys property, was transferred to Manoj and Mahendra as joint tenants. A preliminary deposit of $150.00 is shown by the agent’s receipt to have been received from Manoj and Mahendra. Manoj concedes that this may have been paid by Mahendra but he says that the balance of the deposit was paid by him. Mahendra did not, in his evidence, contradict this. The balance of the purchase moneys was obtained by loan from the ANZ Bank, with the loan again secured by a mortgage of the property itself given by Manoj and Mahendra.

23 The completion of the purchase of Mt Druitt occurred some time before 6 January 1990 (being the date of registration of the mortgage) simultaneously with the sale of St Marys. The bank statements in relation to Home Loan account 2448 05569 already mentioned relate to the period March 1989 to March 1990. They thus straddle the composite transaction of early January 1990 in which St Marys was sold and Mt Druitt was purchased. For 1990, there are entries from 5 January 1990 to 20 March 1990 with an increase, in that period, in the overall debit balance, from $53,177.98 to $61,510.43. I infer from this that that account continued despite the discharge by the bank of the St Marys mortgage and the taking of a new mortgage of Mt Druitt. There was, in the relevant period, an increase in the loan balance. On this evidence, it was again Manoj and Lata, the parties to the home loan account, who, by bank borrowings and the net proceeds accruing to them beneficially from the sale of St Marys, provided the balance of the purchase moneys for Mt Druitt apart, perhaps, from a $150 preliminary deposit which Manoj concedes may have been paid by Mahendra. But, in the present context, that is de minimis and may be ignored.

24 As in the case of the St Marys property, therefore, Manoj and Lata are the only persons who, on the evidence, may be taken to have provided any part of the purchase moneys for the Mt Druitt property. Leaving aside the element I have said may be ignored, it has not been shown by Mahendra (who, as plaintiff, bears the onus of proof) that he provided any part of the purchase moneys for the Mt Druitt property or that he became anything more than a registered proprietor as one of two joint tenants in name only. I should emphasise that, even if the inference as to the provision of borrowed moneys by Manoj and Lata towards the purchase of the Mt Druitt property is incorrect, the fact remains that Mahendra, upon whom the burden of proof lies, has not shown that he provided moneys towards that purchase, whether from borrowings made by him or otherwise.

25 The conclusion therefore must be that, when the Mt Druitt property was purchased, Manoj and Lata alone obtained beneficial interests in it, they being the only persons who appear to have contributed purchase moneys. Mahendra became a nominal purchaser, but must, because of the evidence as to the way in which the moneys were provided, be regarded as no more than a bare trustee holding his interest as one of two joint tenants upon a resulting trust.

26 The only events disclosed by the evidence that are of any possible relevance to the question whether beneficial interests in the Mt Druitt property somehow changed after its acquisition are the events in 1997 involving what were, at the highest, either a disposition by Mahendra in favour of Lata or a disposition by Mahendra and Manoj together in favour of Manoj and Lata together. On the findings I have made, it is unnecessary to consider the effects of the 1997 instruments. At best, they could have done no more than cause to be vested in Lata or in Manoj and Lata such bare legal estate as Mahendra had immediately after the acquisition in or about February 1990. Any such change would have been entirely consistent with, and would in no way have disturbed, the pre-existing situation in which the totality of the beneficial interests was already with Manoj and Lata.

27 Although the conclusions just expressed are sufficient to dispose of the plaintiff’s trust-based claims in a way that favours the defendants, I proceed nevertheless to consider the effect of the two instruments of 1997 on the assumption that, contrary to those conclusions, Mahendra did obtain an equitable interest in the Mt Druitt property at the time of its purchase in the names of Manoj and Mahendra.

28 The first instrument is a transfer in the form required by the Real Property Act. It is undated but bears the signatures of Mahendra as transferor and Lata as transferee. I am satisfied that they signed this instrument before the second instrument I am about to describe came into existence. The signatures are apparently witnessed by Ruth Ligteringen, a Justice of the Peace. Ms Ligteringen gave evidence that Mahendra and Lata both signed in her presence at her office. I accept this, despite both attempts by Mahendra in his evidence to say the he had not signed in her presence and Bijma’s evidence that Ms Ligteringen, without any apparent reason for doing so, phoned her at some point for the sole purpose of volunteering the information that Mahendra’s execution had not been in her presence. Ms Ligteringen has no interest in the proceedings. There is no reason why she should not have told the truth. As a Justice of the peace and an officer of the Department of Community Affairs, she may be taken to be prima facie a reliable person.

29 The first instrument did not operate as a transfer because, among other things, it did not refer to any property, although I am satisfied that the signatories intended or understood it to relate to the Mt Druitt property. The consideration receipt of which is expressed to be acknowledged by Mahendra as transferor is stated in handwriting (acknowledged to be Mahendra’s) to be “in Natural Love And Affection”.

30 The second instrument is also a transfer in the form required by the Real Property Act. It is dated 18 December 1997. The instrument was prepared by Mr Rose, a licensed conveyancer. It relates to the Mt Druitt property and is expressed to be made between Manoj and Mahendra as transferors and Manoj and Lata as transferees. The signatures of transferors and transferees appear in the required places. All signatures are apparently witnessed by Mr Rose. Again, Mahendra gave evidence that he did not sign in Mr Rose’s presence but the preponderance of the evidence from persons present at Mr Rose’s office on the relevant occasion is that all signatories were together with Mr Rose in a conference room at his firm’s office when they signed. I am satisfied that this was so. The consideration is stated to be $92,500. The transfer was in due course stamped and registered.

31 The first instrument is ineffective to produce any legal result. It does not refer to any property. Its only potential relevance is as to any light it might throw on Mahendra’s intentions in relation to the second instrument, should any question as to such intentions arise.

32 There can be no doubt that the second instrument caused Mahendra to lose the legal interest in the Mt Druitt property that he had had since the time of acquisition. On its face, it also deprived him of any equitable interest he may have had, being, according to its terms, a transfer for valuable consideration. It seems, however, that the expressed consideration was illusory or fictitious and that there was not in reality any promise to pay $92,500, it being common ground that, despite what was said in a statutory declaration made at the time for stamp duty purposes, neither that nor any other sum was actually paid or intended to be paid. The evidence of Mahendra, Manoj and Lata supports the view that the transfer effected by the second instrument was in truth a voluntary transfer for which no consideration was given or promised.

33 If, as that evidence indicates, the second instrument was in reality a conveyance without consideration, a question arises as to whether its effect could have been to give rise to a resulting trust in respect of the transferred property in favour of Manoj and Mahendra, as transferors. The legal principles relevant to this – and, in particular, whether statutory provisions in New South Wales preclude the implication of any such resulting trust – were considered at some length by Hamilton J in Bhana v Bhana (2002) 10 BPR 19,545. His Honour’s conclusion was twofold: first, that there is nothing in the Torrens system of land titles, as implemented in New South Wales by the Real Property Act 1900, that prevents a resulting trust arising upon a gratuitous transfer of Torrens title land; but, second, that s.44(1) of the Conveyancing Act 1919 prevents any such resulting trust from arising. Section 44(1) reads as follows:

“No use shall be held to result merely from the absence of consideration in a conveyance of land as to which no uses or trusts are therein declared.”

34 The first of these propositions is supported by observations of Cussen J in House v Caffyn [1922] VLR 67, Dixon J in Wirth v Wirth (1956) 98 CLR 228 and Windeyer J in Newcastle City Council v Kern Land Pty Ltd (1997) 42 NSWLR 273. The second proposition is more problematic, particularly since there is no equivalent of s.44 of the Conveyancing Act in Victoria and Queensland (the States relevant to the decisions of Cussen J and Dixon J) and there are inconsistent decisions on the section in New South Wales. Hamilton J noted the conflicting views as to the effect of s.44(1) in Ryan v Hopkinson (1990) 14 Fam LR 151 (Bryson J) and Newcastle City Council v Kern Land Pty Ltd (above). Hamilton J preferred the result reached by Windeyer J in the latter case and in doing so, made his own detailed analysis of the history and operation of s.44. He referred in particular to the report of Sir John Harvey on proposed amendments to the Conveyancing Act as an indication of the Parliamentary intent behind s.44, including the passage:

“Subclause (1) of cl 44 alters the old implication of a resulting use to a settlor from a simple conveyance of land, without consideration and without the declaration of any use or a trust. As a result of this section, a conveyance purporting to be made by A to B, without more, will pass to B the whole estate of A.”

35 These and other considerations, including those concerning the applicability of Conveyancing Act provisions to land held under the Real Property Act, led Hamilton J to the view that s.44(1) of the Conveyancing Act does apply to such land and operates in relation to it in such a way as to prevent the implication of a resulting trust where such land is transferred without consideration – or, in the words of s.44(1) itself, in a case of “the absence of consideration in a conveyance of land”. I find his Honour’s reasoning compelling and respectfully agree with the conclusions expressed by him.

36 There may, in the present case, be a question whether the situation is truly one of “the absence of consideration in a conveyance of land”. That description will obviously apply where, on the face of the instrument, there is no consideration. Here, of course, there was an expressed consideration of $92,500, albeit a consideration that was not paid and, on the evidence, was never intended to be paid. If this means that the transfer in question is not properly to be regarded as one involving “the absence of consideration in a conveyance of land”, s.44(1) does not apply to it but, at the same time, the basis for the implication of a resulting trust is lacking. In any event, it cannot be the case that a transfer from which consideration is entirely absent (in the sense that none appears on the face and none is actually given) can have some effect different from one in which an expressed monetary consideration is fictitious or illusory and in reality non-existent. A transfer of the latter kind must, in my view, produce the same result as one which on its face shows the gratuitous intent which is obscured by fiction in the transfer in question.

37 On this basis, I am of the opinion that the instrument dated 18 December 1997 between Manoj and Mahendra as transferors and Manoj and Lata as transferees must be taken to have been effective to transfer to Manoj and Lata the whole estate of Manoj and Mahendra, there being no basis on which any resulting trust would have arisen in favour of the transferors. That being so, no occasion arises to consider the question of Mahendra’s intentions at the time of executing the transfer. If that were relevant, however, my finding would be that several factors combine to show that his intention was one of voluntary benefaction towards Lata. The execution and wording of the earlier ineffective transfer are relevant. Ms Ligteringen, the witness to the signatures on that instrument, testified to having drawn Mahendra’s attention to what she understood to be the effect of the transfer (that is, passing of Mahendra’s interest in the property to Lata), to which he replied, “I know what I am doing, I am happy to give away my title as a gift in love.” Although Mahendra denies having said this to Ms Ligteringen, I again accept her evidence in preference to his. It is true that the pretext for the transfer that was eventually effected by the instrument prepared by Mr Rose (after it was recognised that the earlier instrument was of no effect) was to enable Manoj and Lata to raise further funds upon the security of the property in order to turn it to account in a development proposal. But that circumstance does not indicate that Mahendra did not intend to proceed in the way he described to Ms Ligteringen and which was the legal effect of the operative instrument he eventually signed.

38 It follows from my conclusions as to the effect of the second instrument (the instrument dated 18 December 1997) that any equitable interest Mahendra had in the Mt Druitt property at the time of its sale in 2002 would have to derive from some form of alienation by Manoj and Lata (or perhaps one of them) in his favour, being an alienation supported or evidenced by writing satisfying the requirements of the Statute of Frauds. No such basis is asserted by Mahendra.

39 To the extent that Mahendra, as plaintiff, seeks to base the claims on the existence of some beneficial interest on his part in the Mt Druitt property, his attempt fails.

40 As an alternative and subsidiary claim, Mahendra seeks relief pursuant to the Property (Relationships) Act 1984. He claims an order for the adjustment of the property interests of the parties so as to account for his financial and non-financial contributions to the household. Mahendra conceded that his application for such an order was made outside the two-year period allowed by s.18(1), that is, the period of two years after cessation of the relevant relationship, assuming one to have existed. Leave under s.18(2) is therefore required if Mahendra is to be allowed to pursue a statutory application for the adjustment of property rights. This leave may be given:

“where a court is satisfied, having regard to such matters as it considers relevant, that greater hardship would be caused to the applicant if that leave were not granted than would be caused to the respondent if that leave were granted.”

41 The application of s.18(2) has been considered in a number of cases. In Bevan v Fallshaw (1992) 15 Fam LR 686 at 687 Bryson J said:

“The section appears to me to treat an application for leave to apply as a normal event, calling for the court to consider two stages, a finding relating to hardship and the exercise of a discretion.” (s 18(2)).

And, at 687:

“I regard it as relevant to the exercise of that discretion to consider what explanation for delay is offered, but my primary concern ought, in my opinion, to be whether the case put forward is an appropriate case for the plaintiff to apply for an order.”

42 In Rowland v Ellis (2001) 28 Fam LR 656, the Court of Appeal found the appellant’s circumstances were such that the exercise of discretion under s.18(2) was justified. In that case a de facto relationship broke down while the appellant was in custody serving a sentence of imprisonment. At first instance Master McLaughlin held that the relationship ceased as soon as the appellant was imprisoned, with the result that the application for adjustment was made some two years after the end of the period allowed by s.18(1) of the Act. On appeal Stein JA, with whom Meagher JA and Ipp AJA agreed, held that the relationship continued for a considerable period after imprisonment. This meant that the application made by the appellant was only three months late. This, plus the difficulty the appellant faced in attempting to contact his solicitor from gaol, amounted to grounds for the grant of an extension.

43 The first step in considering the question of s.18 leave must be to examine the reason why the claim was not made within time. No cogent reason or explanation is advanced in this case. The inference to be drawn from the whole of the circumstances is that, when Manoj and Lata put the Mt Druitt property on the market in 2002, Mahendra decided to take steps to assert an interest in the property. The caveat he lodged and the removal of which had to be negotiated to allow the sale to proceed claimed an interest different from that he eventually advanced in his main claim in these proceedings. There was not, at that time, any suggestion that Mahendra had any form of entitlement or claim because of his contributions to a domestic relationship. That possibility arose later, no doubt after detailed legal advice had been obtained. The claim under the Property (Relationships) Act became an addendum to the trust-based claims. An entitlement warranted by contributions to a relationship, as distinct from a proprietary interest arising becoming one of two co-purchasers of the Belmore property, simply was not part of Mahendra’s thinking.

44 The second step in considering the question of s.18 leave must be to see whether there is a prima facie case that the court has jurisdiction to entertain the substantive claim. I consider such a prima facie case to be made out, at least in a technical sense. Section 14 permits a party to a “domestic relationship” to seek relief under the Act and s.20 empowers the court to make an order upon such an application. Under s.5, a “domestic relationship” includes:

“a close personal relationship (other than a marriage or a de facto relationship) between two adult persons, whether or not related by family, who are living together, one or each of whom provides the other with domestic support and personal care.”

Mahendra, on the one hand, and Manoj (his son) or Lata (his son’s wife), on the other, may well be found to have had a “close personal relationship”. It is clear, on the evidence, that all three of them lived together (including in the Mt Druitt property) at various times in New South Wales and that the period of the relationship was at least two years (see s.17). It also appears that Manoj and Lata, by keeping up that household, provided Mahendra with at least “domestic support”. At a prima facie level, therefore, the jurisdiction created by the Act is attracted. I do not understand the defendants to dispute this.

45 Next, attention should be directed to a preliminary assessment of the strength of the claim Mahendra would seek to pursue. To be viable, any such case must be based on the criteria in s.20:

“ Application for adjustment
(1) 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.

(2) A court may make an order under subsection (1) in respect of property whether or not it has declared the title or rights of a party to a domestic relationship in respect of the property.”

46 The evidence shows that, in 1985, Mahendra made a one-off payment for his son’s benefit to help him acquire and set up a home at the time the son was approaching marriageable age and had the idea of marriage in contemplation. That, in my view, had nothing at all to do with any domestic relationship between the father and the son. After Manoj and Lata were married, they worked to obtain funds for the upkeep of the household which came to include not only their children but also Manoj’s parents, Mahendra and Bijma, although Manoj had periods of unemployment and Lata eventually had to give up work because of an injury for which she is in receipt of workers compensation payments. The earnings of Manoj and Lata were the source of virtually all of the payments for ordinary living expenses for the four adults and the children and also kept the roof over their heads by ensuring that the housing loan payments were kept up. Mahendra, after coming to Australia with a view to remaining permanently, was initially forbidden by visa conditions to take paid employment, but concedes that he worked for a period in breach of the visa conditions. Lata, although living in the same house, did not know that he went to work when he left the house regularly during that period – much less that he was receiving wages. Mahendra says that he applied his earnings for the benefit of the household. Manoj and Lata say that he did not and that they kept him and Bijma. Documents Mahendra lodged for immigration purposes said that he would be supported in Australia by his children (both Manoj and his sister being Australian residents at the time). It is clear that Mahendra and Bijma looked after the children of Manoj and Lata at various times and gave them gifts, as one might expect grandparents to do according to the natural affection that prevails within families. On one occasion, Mahendra and Bijma took two of the grandchildren to Fiji for an extended period. On one account, this was to allow Lata to continue working and earning money but, on another, it caused her great anguish and distress and was against her wishes. There is clear evidence that Manoj and Lata sent money to Fiji regularly during this period for the upkeep of the children who were with the grandparents and that, on one occasion, Mahendra wrote asking for money to be sent.

47 This being, in outline, the evidence that would be relied upon in Mahendra’s case as to contributions said to warrant an adjustment of property rights under s.20, it must be said at once that the contributions of a kind relevant to s.20 made by Mahendra were very few indeed and that the case is very weak. This is a particularly relevant factor in approaching s.18(2): Hayes v Harrison [2002] ACTSC 22.

48 Having regard to the various considerations just mentioned as relevant to the operation of s.18(2), I am not satisfied that the hardship to Mahendra would be greater if leave under the section were not granted than if it were granted. The appropriate course is therefore to refuse leave.

49 The overall result, therefore, is that the plaintiff’s oral application for leave under s.18 of the Property (Relationships) Act is refused and all claims in the amended summons are dismissed with costs.

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Last Modified: 03/05/2004