Skyllas v State Trustees Limited
[2008] VSC 52
•3 March 2008
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION
No. 8934 of 2005
| JOHN SKYLLAS | Plaintiff |
| v | |
| STATE TRUSTEES LIMITED | Defendant |
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JUDGE: | HARPER J | |
WHERE HELD: | MELBOURNE | |
DATES OF HEARING: | 15-16 AUGUST 2007; 7-6, 12, 13 & 15 FEBRUARY 2008 | |
DATE OF JUDGMENT: | 3 MARCH 2008 | |
CASE MAY BE CITED AS: | SKYLLAS v STATE TRUSTEES LIMITED | |
MEDIUM NEUTRAL CITATION: | [2008] VSC 52 | |
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TRUSTS – Real property – Registered proprietor in care and administrator appointed - Whether the administrator should be restrained from selling the property – Whether son of the registered proprietor has an equitable interest in the property – Whether property held on trust for the plaintiff.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | In Person | |
| For the Defendant | Ms C. Sparke | Maddocks |
HIS HONOUR:
The plaintiff, Mr John Skyllas, lives at 20 Amsterdam Street, Richmond. The land on which stands the house in which he lives is described in certificate of title volume 2946 folio 089. The registered proprietor is his mother, Mrs Anastasia Skyllas. But Mrs Skyllas is no longer in residence. She is almost 81 years old, having been born on 12 March 1927. On 24 September 2004 she was taken from the Richmond home for medical treatment. She has never returned, and now lives in accommodation for the elderly. It is not in dispute that her health is so frail that she was unable to give evidence in this trial.
On 2 February 2004,[1] about eight months before Mrs Skyllas left 20 Amsterdam Street, the defendant (State Trustees Limited) was appointed administrator of Mrs Skyllas’ affairs pursuant to Part 5 (“Administration Orders”) of the Guardianship and Administration Act 1986. Division 3A (“Additional powers and duties of administrators”) of that Part confers on administrators powers in addition to those conferred by Division 3 (“Powers and duties of administrator”). Among the additional powers are those set out in s.58B. Subject to and in accordance with the Act and with the relevant administration order, an administrator upon appointment has the general care and management of the estate of the represented person. Indeed, as part of these responsibilities, the administrator is under a duty, imposed by s.58B(1)(b), to take possession and care of, recover, collect and preserve the property and estate of that person. Consistently with this, the administrator is given the express power, pursuant to s.58(2)(g), to sell or otherwise convert into money any of the property belonging to the person under the administrator’s charge.
[1]The date of appointment was not the subject of evidence, given that the fact of appointment was admitted. I have taken the date 2 February 2004 from the defendant’s chronology, which was produced during the trial. In each of its defence, amended defence, and further amended defence, however, the defendant (in each case, in paragraph 13) gives the date of its appointment as 10 August 2004. The date is relevant only as background information.
The defendant seeks to exercise these powers. It wishes to sell the property at 20 Amsterdam Street. It asserts that, because it stands in Mrs Skyllas’ shoes, it needs no justification; it simply wishes to exercise one of the inherent powers of ownership. But, if justification were required, it is that the proceeds of sale will - to the extent that government does not do so - fund Mrs Skyllas’ care.
Accordingly, State Trustees has twice written to Mr Skyllas asking him to vacate. The first of these letters is dated 23 November 2004, and allowed Mr Skyllas 60 days’ further residence while he found alternative accommodation. This explains the defendant’s counterclaim for damages. These, it contends, commenced to accrue at the expiration, on 23 January 2005, of the 60-day period of grace.
The plaintiff denies the defendant’s right sell. He claims an equitable interest in the property. It arises, he contends, from a resulting trust of which he is the beneficiary,. On 6 December 2004, he lodged a caveat (numbered AD286345S) to protect that interest. According to the caveat, Mr Skyllas is the owner of an estate in fee simple in the Richmond land. In the statement of claim filed in these proceedings on 24 October 2005, a statement of claim Mr Skyllas drew himself, he seeks an order restraining the defendant “from transferring, leasing, disposing of, pledging, encumbering, assigning or devaluing all or any part of the … Richmond property”.
Mr Skyllas’ claim for an equitable interest in the Amsterdam Street address has a number of bases. The first of these, however, is inconsistent with that to which his caveat refers. As I understand this ground, he says that his mother - despite her status as the registered proprietor - has no greater beneficial interest in the property than a right to live in it for so long as she wants. He and his only surviving sibling, Mr Con Skyllas, have the same entitlement. On this argument, it is his maternal grandmother’s estate which is the beneficial owner of the fee simple. Mrs Skyllas has therefore nothing to sell. And if she does not, nor does State Trustees.
The remaining bases are put in the alternative to that founded on the interest allegedly held by Mrs Skyllas’ mother. Each of these has its origin in the proposition that Mrs Skyllas holds the Richmond land, or at least an aliquot share in it, in trust for the plaintiff. I shall summarise each briefly before returning in detail to those, including the first, which require more detailed examination.
The first of these alternative bases rests on what is alleged to be a sale and purchase. According to the plaintiff’s amended statement of claim, filed on 8 May 2006 and like its predecessor drawn by him, “a transaction took place between the plaintiff and his mother where she agreed to exchange the title to the property as security for a 50% share in equity in that same property for the sum of $28,000.00 cash on or about 6 May 1982.”[2] The money was paid as agreed and, accordingly, the plaintiff’s equitable interest vested[3] in him.
[2]Amended statement of claim, para. 22A.
[3]Ibid, para. 22B.
The plaintiff next pleads that, at an unspecified date, his mother requested him to carry out “substantial improvements” to the property, “involving both personal labour and materials”. The plaintiff obliged. He has never been paid. On the other hand, the amended statement of claim does not allege that his mother’s request was accompanied by a promise of any reward or recompense, still less that she agreed - in return for his work - to transfer to him an interest in the property. More to the point, there is no evidence of an intention to create a trust. Nor is there any evidence of any agreement by Mrs Skyllas to give any consideration for the plaintiff’s work; so no claim in contract could succeed, even if it were pleaded. Finally, the plaintiff does not claim in quantum meruit. I can therefore put this issue aside.
An additional allegation must be mentioned at this point. The plaintiff asserts that, sometime during 1996, his brother Michael suffered severe internal injuries when he “accidentally consumed a glass containing a corrosive substance believed to have been caustic soda”.[4] The amended statement of claim continues, in the particulars under paragraph 22C:
[4]Ibid, particulars under para. 22C.
Anastasia asked the plaintiff what his price was if he were to personally drive her to the various hospitals where Michael Skyllas was situated over a long term period?
Anastasia and the plaintiff came to an agreement that the entire Richmond property would belong to the plaintiff in return for his long term services to her.
The agreement was verbal between the parties, and Anastasia agreed to hold in trust the Richmond property on behalf of John Skyllas as long as he honoured the terms of the agreement and drove her around to the various hospitals to attend to the immediate needs of Michael Skyllas whenever needed, and in addition to such drove her around whenever she needed and went [sic], including sending the plaintiff to get her specific items of shopping whenever she required them. This agreement was generally well known to many of Anastasia’s relations and close friends, as she had conveyed it to them.
The plaintiff honoured all of the terms of that agreement and drove Anastasia Skyllas as often as twice a day to visit Michael Skyllas at various hospitals, and is thereby entitled to the property pledged to him by Anastasia Skyllas. Some of these terms included that:
(a)John Skyllas was to purchase at his own expense a special vehicle (Mercedes Benz saloon) for the exclusive purpose of driving Anastasia and Michael Skyllas to and from various hospitals;
(b)John Skyllas was not permitted to take up any full time employment that would interfere with driving Anastasia Skyllas to visit Michael Skyllas, and as a result suffered financial loss of tens of thousands of dollars as to enable him to honour the terms of the agreement.
(c)John Skyllas had to make himself available at call seven days a week for as many times as was needed to drive Anastasia Skyllas to visit Michael Skyllas in hospital or if possible drive Michael Skyllas home on day leave visits and return him to the hospital afterwards. [Emphasis as in the original.]
Another allegation is made in the amended statement of claim. By paragraph 25 of that pleading, the plaintiff alleges that 20 Amsterdam Street Richmond was pledged “in its entirety” to him by his mother in December 2003. She did this, so the amended statement of claim would have it, because “she felt responsible for the theft and conversion of the entire plaintiff’s chattels having an estimated value exceeding $200,000 from the property while under her care.”
The plaintiff gave evidence of the circumstances in which his belongings disappeared; but he did not establish the fact of the pledge itself. In any event, no consideration was given for it. It therefore did not give rise to either an enforceable contract or an equitable interest. For this reason, I need consider it no further.
The plaintiff, in paragraph 11 of his defence to counterclaim dated 1 June 2006, raised an issue based upon s.44.10 of the Aged Care Act 1997 (Clth). So far as is relevant, that section provides that, in working out the value at a particular time of the assets of a person who is or was then a home owner, the value of a home – owned by the person – that, at the time, was occupied by a carer of the person, is to be disregarded. But the carer had to meet two qualifications. The first was that he or she had occupied the home for the past two years. The second was that he or she was, at the time, eligible to receive an income support payment.
The plaintiff asserts that he was his mother’s carer. He also maintains that he meets the two specific criteria: he had occupied the home for the past two years before September 2004, and he was eligible to receive the relevant support payment. The Richmond premises are therefore, he argued, beyond the reach of the defendant.
This conclusion is not one which a fair reading of the legislation can sustain. Parliament intended to ensure that, if a carer with the necessary attributes was living in the home of the person whose assets were being valued, then the value of the home was to be disregarded. So, given that the plaintiff was living at 20 Amsterdam Street when his mother was last in residence there in September 2004, and was her carer, any valuation of her assets at that time would disregard the value of the home; but only if, at that time, the plaintiff had been in occupation for the past two years, and was eligible to receive an income support payment.
On the other hand, a valuation of Mrs Skyllas’ assets today, on the assumption that the Richmond home was hers, would be different. She has been in aged care accommodation for over three years. The plaintiff has not been her carer during that period. So any valuation of her assets would now include the Richmond premises. And the Aged Care Act does not provide a barrier to those premises being sold at any time (especially now, given that it is now to be included in her assets free of any claim the plaintiff might once have had as her carer). The essential point remains: the Act does no more than affect the valuation, whenever that valuation is carried out, of the assets of a person under care.
The plaintiff did pursue, with vigour, the allegation that his mother held the property on trust to permit her mother, herself and her children to live there for as long as they wished. The trust arose, he argued, out of conversations between Mrs Skyllas and the plaintiff’s grandmother, Thekla Georgiadou, which were overheard by the plaintiff in 1968, when he was about nine years old. The effect of them was that Mrs Georgiadou would provide the funds to purchase a house in which all could live. According to the plaintiff, his grandmother said to his mother: “I will come up with the money, we buy the house, I will put it in your name and it shall provide housing for yourself, myself and the three … boys.”[5]
[5]Transcript, p.18 lines 23-26.
A purchase followed: not of 20 Amsterdam Street, which was acquired in 1975, but of a property not far away – at 184 Brighton Street, Richmond. The latter became the family home for some seven years between 1968 and 1975, after which 20 Amsterdam Street was bought. The proceeds of the sale of Brighton Street, together with some funds lent by the plaintiff’s brother Michael, furnished the means for the Amsterdam Street acquisition.
I am prepared for the purposes of this judgment to assume that the entirety of the purchase price, including the funds used to repay Michael, was provided directly or indirectly by Mrs Georgiadou. That is the allegation made in paragraph 7 of the amended statement of claim; and in paragraph 10 it is alleged that it was her “express intention that the Richmond property … be used for the immediate family to live in, and that the plaintiff and his son Jason remain part of that immediate family.”
Putting aside the fact that Jason was not born in 1968 (when his father was only nine years old - and when the conversation referred to in paragraph 17 above allegedly took place) the difficulty for the plaintiff is that there is nothing in what Mrs Georgiadou said to her daughter that is inconsistent with a gift from mother to child – with the donor retaining only the right to live at the Amsterdam Street address.
On this analysis, Mrs Georgiadou’s intention was as likely to have embraced a gift as the creation of a trust. And, if a gift was intended, her estate had and has no interest in that property. On the other hand (as the plaintiff correctly noted in his 95-page set of submissions) if he is to succeed in establishing that his grandmother deliberately brought a trust into existence, he must prove each of four elements; the first being an intention in the settler to create the trust. If Mrs Georgiadou did use the words attributed by the plaintiff to her, they fall short of satisfying me on the balance of probabilities that she intended to create a trust of any kind.
During the course of the presentation of his case, the plaintiff on several occasions alleged that his mother had stolen from her mother, using the fruits of her crime to supplement the funds available for the purchase of the Amsterdam Street property. The point seems to be that, to this extent, no gift was involved; indeed, the opposite was the case. And the thief’s use of the proceeds of theft to make such an acquisition entitles the victim to trace that expenditure, while in the meantime the property (at least to the extent that ill-gotten gains were employed) is held by the thief on a constructive trust for the victim.
If that is the point, it is not raised in the amended statement of claim. What is more, the evidence does not enable me to conclude that Mrs Skyllas is a thief. I accept of course that the burden of proof which the plaintiff must discharge is the civil, not the criminal, burden. He must satisfy me, on no more than the balance of probabilities, that each element of any particular cause of action upon which he relies has been established. To the extent that he relies on his mother’s theft to found a conclusion that she had no greater interest in the land than that of a constructive trustee for his grandmother, he must satisfy me only on the balance of probabilities. In other words, I must be able, before accepting the conclusion to which the plaintiff would have me come, to reach a state of reasonable satisfaction about its correctness. “But”, as Dixon J observed in Briginshaw v Briginshaw[6]:
… reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters "reasonable satisfaction" should not be produced by inexact proofs, indefinite testimony, or indirect inferences. Everyone must feel that, when, for instance, the issue is on which of two dates an admitted occurrence took place, a satisfactory conclusion may be reached on materials of a kind that would not satisfy any sound and prudent judgment if the question was whether some act had been done involving grave moral delinquency. … This does not mean that some standard of persuasion is fixed intermediate between the satisfaction beyond reasonable doubt required upon a criminal inquest and the reasonable satisfaction which in a civil issue may, not must, be based on a preponderance of probability. It means that the nature of the issue necessarily affects the process by which reasonable satisfaction is attained.
[6](1938) 60 CLR 336 at 362-363.
It is upon this passage that I have acted in considering whether I should find that portion of the purchase price of 20 Amsterdam Street came from money misappropriated from Mrs Georgiadou. An additional factor has been the absence from the witness box of Mrs Skyllas. I have already referred to the state of her health. She has not been called to give evidence because she is not fit enough to do so. Her version of events – events which happened many years ago, and which involved in a very intimate way the relationship between her and Mrs Georgiadou - has not been heard. In the light of an affidavit she filed in proceedings in the Supreme Court of New South Wales, to which I shall return, it is to be expected that, were she able to give evidence, that evidence would not support the plaintiff’s account of the funding of the purchases of the two Richmond properties.
The plaintiff tendered four Commonwealth bank passbooks in the name of his mother as trustee for his grandmother. He alleges that amounts were drawn by Mrs Skyllas from this account, which as I understand it was the repository of Mrs Georgiadou’s pension, “in making repayments on the Brighton Street, Richmond property.”[7] This is entirely consistent with Mrs Georgiadou’s statement, which the plaintiff remembers hearing, that “I [that is, Mr Skyllas’ grandmother] will come up with the money”. It is also consistent with that money being a gift rather than an element in the creation of a trust. Likewise, the propositions that Mrs Skyllas “continued to withdraw the entirety of the funds in her mother’s trust account – even after the Brighton Street property had been paid off and even after the Amsterdam Street, Richmond property was paid off”[8] and that “Thekla Georgiadou provided the funds that enabled the purchase of two properties”[9] is consistent with Mrs Georgiadou’s willing contribution of the purchase price of each of those assets. Whether drawings after that were authorised or misappropriated is not a matter relevant to the issues between the parties in this case.
[7]Plaintiff’s submissions and outline of argument, p10.
[8]Plaintiff’s submissions and outline of argument, p10.
[9]Ibid, p.11. At p.19 of that document, the plaintiff states that “[i]t in fact was well known and accepted by the late Thekla Georgiadou that the funds from this trust account were being used by Anastasia Skyllas to purchase and maintain the two said properties located in Richmond”.
In all the relevant circumstances, I am unable to be satisfied on the balance of probabilities that Mrs Skyllas used money stolen from her mother to purchase, or to assist in the purchase, of the homes in which her mother subsequently lived with her and with her children.
In the amended statement of claim, the plaintiff has described the transaction of 6 May 1982[10] as “cash in exchange for equity”. He alleges that his mother “agreed to exchange the title to the property as security for a 50% share in equity in that same property for the sum of $28,000 cash”.
[10]See para. 8 above.
The evidence for this transaction is the plaintiff’s sworn testimony that it took place. There is no supporting documentation. Not only that, but the asserted right was first raised only in the original statement of claim. Had it been based on fact, it and a number of other claims upon which the plaintiff now relies would - the defendant suggests - have been raised on earlier occasions. Yet they were not. Indeed, in the past, the plaintiff by implication repudiated their factual basis. Given the importance of these issues in evaluating the strength of the plaintiff’s evidence at this trial, it is to those earlier occasions that I now turn.
The plaintiff’s father, Sakellaris Skyllas, died on 11 March 2001. Part of his estate was a residential property located at 796 Victoria Road, Ryde, New South Wales. After his death, his widow instituted a proceeding (No. 3034 of 2002) in the Supreme Court of New South Wales under the Family Provision Act 1982 of that State. Her sons Constantine (“Con”) and John were the defendants in an action in which she sought provision for herself from her late husband’s estate. She filed an affidavit, dated 4 June 2002, in that proceeding. In it, she noted that her husband had made a will dated 14 March 1983. By his will, he left all his property to his three sons. His wife received nothing. In these circumstances, it would obviously damage her claim for provision from his estate were she to ascribe to herself assets she did not in fact have.
If the present plaintiff is correct, that is nevertheless what she did. She told the Court, in her affidavit, that she bought 184 Brighton Street “in about 1975 for around $20,000.” Her mother “helped me pay it off.” The affidavit continues, at paragraph 27:
I bought the property at 20 Amsterdam Street, Richmond where I presently live for $34,500 in 1975. Michael lent me the money to help me buy this property as I could not get a loan from any bank because I was a pensioner. At about this time Michael became ill. I paid Michael the money that he loaned me by instalment payment and he stayed at the Amsterdam Street property without paying board.
Nothing in the affidavit suggests that Mrs Skyllas had transferred a half interest in any land to her son John in return for his payment to her of $28,000 – or any other amount. On the contrary, she listed in her affidavit “[d]etails of my assets”. The property at 20 Amsterdam Street was one of them, and its value is given as $300,000. The affidavit contains no hint of a half-share being owned by the present plaintiff. One reference to him is to be found in paragraph 42:
My house at Richmond is small and very cluttered at the moment. My son John and my grandson Jason moved into the house in March this year after a nine year absence. The house has laneways at the back and side and has no verandah and garden. It is a confined house and I feel claustrophobic at times in it.
The plaintiff himself filed an affidavit in the New South Wales proceeding. It is dated 1 October 2002. In it, he told the Court that he had no objection to his mother being given the land in Ryde. Then, in paragraphs 36 and following, he states:
I myself along with my 13 year old son Jason live with the plaintiff at her residence in Richmond, Victoria.
The house is small and confined and I am presently sleeping in Michael’s bed. My son sleeps on the sofa in the loungeroom, due to the inadequacy of her house. My mother relies upon me totally for all her medications and the administration of eye drops four times daily after having recent cataract surgery. She is also reliant upon me to drive her around wherever she wishes to go, or to visit Michael in hospital. I drive her to and from the hospital three to four times a week.
Neither myself John Skyllas, or my other brother Michael Skyllas so named as beneficiaries in the will of the deceased own any property or real estate … The plaintiff in my opinion has proven over the years to be the backbone of the family, and had to almost commence to rebuild a new life for all three children after being forced to leave the Ryde property in 1973.
It is impossible to ignore in this Court a sworn statement made in 2002 by Mr Skyllas to the Supreme Court of New South Wales that he owned no real estate. That statement must be taken into account when attempting to measure the credibility of his present evidence that on 6 May 1982 he bought from his mother a half share in the Amsterdam Street premises. It must also be taken into account when assessing the truthfulness of his present claim that in 1996 Mrs Skyllas promised to hold the property in trust for him in return for his promise to drive her on visits to his brother Michael.
A further affidavit was filed by Mr Skyllas in his mother’s proceeding. It is dated 12 June 2003. At this point, Mr Skyllas’ attitude towards his mother’s claim had changed. In his opening paragraph, he deposes to his belief that his mother does not have a valid case against his father’s estate. He continues, in paragraph 3:
The plaintiff Mrs Anastasia Skyllas is best described as being treacherous. She is somewhat like a schizophrenic in nature and changes from one extreme to the other. She uses people and when she no longer needs them she disposes of them somewhat like a black widow spider who kills and eats up the male after mating. Mrs Skyllas used me for many years so that I could drive her around everywhere she wanted because nobody else was prepared to help her. Whenever I started to trust her she then turned against me for no apparent reason. Mrs Skyllas is best described as being as low as a deadly snake that bites unexpectedly without warning, and I would never trust her ever again either in this Family Provision Act claim or any other matter if she were to try and revoke the current intervention orders against me and want me back in her life.
The reference to being “used” is inconsistent with the proposition, set out in the amended statement of claim, that Mr Skyllas and his mother “came to an agreement that the entire Richmond property would belong to the plaintiff in return for his long term services to her.” It is, however, consistent with the absence in Mr Skyllas’ affidavit of 12 June 2003 to any claim that he has, by reason of the provision of such services, rights of beneficial ownership in the Amsterdam Street property. Paragraph 9 of the affidavit merely describes that property as “a three bedroom home that is quite suitable for Mrs Skyllas as the sole resident”; and earlier in the affidavit the present plaintiff states that his mother used his grandmother’s money to pay off the house.
The plaintiff’s affidavit of 12 June 2003 in his mother’s New South Wales proceeding is relevant here for another reason. It will be remembered that, in her affidavit of 4 June the year before, Mrs Skyllas deposed that she had bought the Amsterdam Street premises, and said nothing to suggest that she was not the beneficial owner of it. A year later, on 12 June 2003, her son John swore to his belief:
… that as of 7 June 2002 [three days after her affidavit was sworn], Mrs Skyllas went into a state of confusion … Mrs Skyllas is extremely confused, and no longer the same person who gave instructions to her solicitor Mr Mednis in June 2002. The Mrs Skyllas that made her affidavit … on 4 June 2002 has become a different Mrs Skyllas to the person that exists today. She has turned against me.
The inference is that, when giving her solicitor instructions for the drawing of the affidavit of 4 June 2002, Mrs Skyllas was clear of mind; but three days later she was not. Consistently with this, Mr Skyllas - in a written statement dated 3 December 2003 to the Victorian Civil and Administrative Tribunal in support of an application in the Tribunal’s Guardianship List to have a guardian appointed for his mother - stated that her “affidavit of 4 June 2002 … shows her true state of mind immediately prior to suffering from the confusion and memory problems that occurred as of 7 June 2002.” I take this to be an invitation to the Tribunal to accept the accuracy of the contents of Mrs Skyllas’ affidavit.
By 2004, Mr Skyllas had instituted his own proceeding in the Supreme Court of New South Wales (No.5689 of 2004). This too was a claim under the Family Provision Act. He filed an affidavit dated 24 January 2004 in support of his application. It contains several references to the Richmond land, but none to any interest he might have in it. At paragraph 9 he deposes to a suggestion made by his brother Con that “Michael and I surrender our entire share in the Ryde property to him alone in exchange for the Richmond … property where the widow, my son Jason, and I lived.” That would not be much of an exchange if John had already paid $28,000 in return for a half share in the Amsterdam Street premises. It would be even less of a fair deal if John was already the beneficial owner of the whole of that land by reason of his mother’s declaration of trust in his favour in return for his (honoured) promise to drive her on visits to Michael.
At paragraph 16 of the January 2004 affidavit, Mr Skyllas refers to the letter from State Trustees dated 23 November 2004 to which I adverted in paragraph 4 above. Rather than assert an interest in the property from which the State Trustees were by that letter seeking to evict him, he merely states that, in the light of that letter, he “has nowhere to go to live”.
A further affidavit, this one dated 15 October 2004, was sworn by Mr Skyllas and filed in his NSW proceeding. By this time his mother was no longer a resident of the Richmond premises, but was under care elsewhere. Mr Skyllas notes that he had returned to live with his mother after a period of “long term homelessness”, but says nothing about any interest he had in the very place that was the subject of this portion of the affidavit.[11] Indeed, at paragraph 10 he describes his need for accommodation. He says:
My situation with housing also needs to be taken into consideration given the fact that I was forced to endure a 14-month period of homelessness and being forced to sleep in my vehicle since the passing of the deceased [Sakellaris Skyllas]. My future is uncertain and my needs are great. I am presently residing in my mother’s residence in Richmond, Victoria.
[11]Affidavit of John Skyllas sworn 15 October 2004, at para. 4.
Another relevant reference is to be found in paragraph 12. The deponent there alleges that his brother Con stole everything that the plaintiff owned. According to the affidavit, the goods in question had been removed from the Amsterdam Street premises by Con whilst John was in Sydney. After describing those premises as “my residence”, the deponent goes on to note that Mrs Skyllas “did not realise what was occurring within her own home”. (My emphasis.)
Reference should be made to two further passages from the affidavit of 15 October. At paragraph 20, Mr Skyllas refers to the fact that, on 24 September 2004, his mother “was taken away from her home”. In the following paragraph, he accuses State Trustees of refusing to pay the telephone bill for the premises, and refusing “to address important issues of safety and security in Mrs Skyllas’ residence, refusing to accept responsibility for urgent and dangerous electrical repairs, repairs to stove, repairs to burglar alarm system, changing the front and rear door locks securing entry to premises etc.” This is starkly inconsistent with the proposition that Mr Skyllas himself was the owner of the property. So is his reference - in paragraph 27 - to the fact, as he there puts it, that he has “been recently residing at 20 Amsterdam Street … in makeshift arrangements with my mother” (emphasis as in the original). His argument in this proceeding was that his arrangements with his mother were the exact opposite of makeshift.
Under the heading “My Only Assets”, Mr Skyllas states, in paragraph 85 of his affidavit of 15 October 2004 that his only assets are three motor vehicles. Apart from them, all that once was his had disappeared: “Con Skyllas had managed to steal everything I owned and had purchased in the 27-year period since leaving school.”[12] The result, as Mr Skyllas put it in paragraph 96 of his affidavit, would be that he would have to rebuild his life from scratch, and would require special provision out of the estate for this purpose. He continued:
I had to live in my vehicle for almost fourteen months, and not be able to stretch my legs at night as to get a decent night’s sleep. I require additional provision as to enable me to try and do this.
[12]Affidavit of John Skyllas sworn 15 October 2004, at para. 89.
A month or so after this affidavit was sworn, State Trustees sent the letter of 23 November, giving Mr Skyllas 60 days to vacate the Amsterdam Street premises. It was received by the plaintiff on 3 December. His reaction was immediate. That day, he wrote to State Trustees to inform them that he had an equitable interest in that land, and had no intention of complying with their request for vacant possession. In his letter, he claimed that his interest arose out of the “major renovations and improvements to the Richmond property” for which he was personally responsible, “using my own funds and resources.” His mother, he said, was not financially capable of effecting the works he had completed, and in recognition of this “made her intentions clear that I was to remain living at this or any other house that she owned.”
This, of course, is consistent with Mrs Skyllas remaining the legal owner while her son had rights of occupancy. It is not necessarily consistent, however, with Mr Skyllas having a beneficial interest of the kind he now claims.
On 6 December 2004, Mr Skyllas swore another affidavit for use in the Supreme Court of New South Wales. He exhibited to that affidavit the letter dated 23 November 2004 which by now he had received from State Trustees. In significant contrast, he did not exhibit his response of 3 December. Nor did he refer in his affidavit to the assertion, as made in that response, of an equitable interest – or, indeed to any interest, equitable or otherwise. On the contrary, he said in paragraph 9 that, as “I have already stated in my affidavit in support of my claim for provision … I was forced to live and sleep in my vehicle for a period of fourteen months, and with this latest turn of events I would have nowhere to go or live.”
The Court therefore remained to this point ignorant of any claim that Mr Skyllas asserted over Amsterdam Street. The fact of that claim to a beneficial interest, and its basis in a trust said to result from the alleged improvements, only emerged during the course of the NSW trial.
The point for present purposes is that, during the course of many months of litigation in the Supreme Court of New South Wales, involving two proceedings for provision out of the estate of Sakellaris Skyllas, neither the present plaintiff, nor his mother, nor anybody else, asserted that Mr Skyllas had any interest in the Amsterdam premises. The assertion was only made when eviction threatened; and even then it was not made fully and openly. Rather, it was made known to State Trustees, while at the same time it was withheld from the Supreme Court of New South Wales. The conclusion, it seems to me, is inevitable. In the one case, Mr Skyllas hoped to dissuade State Trustees from evicting him. In the other, he hoped to prevent injury to his claim for further provision from his father’s estate.
On 30 April 2003, Mr Skyllas wrote to his mother’s solicitors in New South Wales. He then gave his address as 8 Magenta Place, Carlton South. An intervention order had on 3 February been obtained by his mother against him; its effect was to prevent him residing with her. It is in this context that paragraph 10 of the letter takes the following form:
That due to your client’s behaviour I have no intention to ever return to live with her unless she is prepared to make a commitment never to throw me on the street ever again. This commitment that I ask is that she transfers ownership of her residence to my name, so that she is never able to get another intervention order against me under such circumstances and once again make me homeless ever again … I could not ever imagine me ever having owned the house where she lived, and where I would have thrown her out on the street in the manner in which she has done to me. She has admitted in her affidavit that I drove her around to the hospital to visit Michael approximately four times a week, and I do not deny this. I have gone to great trouble to assist her, and she has caused me nothing but grief and disappointment.
The reference to driving Mrs Skyllas, including Mr Skyllas’ observation that he does not deny that he did just that, is not accompanied by any suggestion that the plaintiff thereby became the beneficial owner of the Richmond premises. Yet, during the trial before me, this was the claim most strongly pressed by the plaintiff. And I accept that he did drive his mother, frequently, to visit his brother Michael in hospital. He also brought Michael home for family visits, and returned him when the time came to return. He did this from 1996, when Michael suffered his internal injuries following his accidental ingestion of a corrosive substance, until Michael’s death on 26 January 2006. But the overwhelming effect of the evidence, it seems to me, is that all this was done without his mother intending to create any trust in his favour. And if the arrangement between mother and son was merely an agreement, rather than something that gave rise to a trust, then that agreement was not in writing; and if it was not in writing it is, by reason of s.126 of the Instruments Act 1958, a contract in respect of which an action “must not be brought”.
It might be argued that, on the evidence, the plaintiff has established an agreement between himself and his mother, the terms of which were that, in return for a promise to leave the premises to him in her will, he would drive her to visit Michael as often as she wished. He carried out his side of the bargain, and only the imposition of a constructive trust would satisfy the equity that has thus arisen.
There are difficulties with this argument. First, the evidence is inconsistent. At one point, Mr Skyllas described the circumstances in which the agreement was made. He said:
My grandmother passed away in 1995 … I wasn’t living at Amsterdam Street … but I visited every day and took Mrs Skyllas to see Michael every day, quite often twice a day, … but it was a full-time commitment asked of me by Mrs Skyllas under an agreement that if I did what she wanted, drove her round indefinitely whenever she wanted, whenever she asked, and did this on a full-time basis, the … Amsterdam Street house was mine 100%.[13]
[13]Transcript, p. 34 lines 11-22.
If this is correct, the plaintiff commenced to drive his mother on visits to Michael in 1995. Contrast this with his evidence of a conversation he “witnessed” between Michael and his mother “at the Richmond property about the year 1997.” Mrs Skyllas told Michael that she wanted his opinion on:
an agreement with your brother John whereby he would drive me to visit you indefinitely on a permanent basis. … I’ve decided to make a will … so that your brother John will be the sole proprietor of the Richmond [home]. John has given me his personal assurances you can live in the house your entire life. Would you be happy to go along with that arrangement or that agreement?[14]
[14]Ibid, pp. 43-44 lines 28-24.
Another contrast is in order - this time with the version given by the plaintiff under cross-examination. In answer to the question “So what were you going to get from her [Mrs Skyllas] in return for driving her to visit Michael?” Mr Skyllas said:
I would get a lifelong interest in living at the property, and proprietorship of the property upon her death. Full proprietary ownership of the property upon her death, but under the condition that I do not sell or do not evict Michael Skyllas and … give him the full use of the property … for the entire remaining time of his life.[15]
[15]Transcript, pp.408 line 30 -- 409 line 6.
In the present case, the uncertainty surrounding the driving arrangements is such as, in my opinion, to preclude a finding that a binding agreement had been reached, or that a trust had been created. In other words, the basis upon which the plaintiff made available his car and driving skills in the service of his mother was itself too uncertain to have created any relevant expectation. Nor, given that uncertainty, is there a proper basis for a finding in the plaintiff’s favour founded upon promissory estoppel. This is true not just of the claim arising out of the driving arrangements, but more generally.
If the plaintiff is correct in his analysis of what he contends are the facts, then one would expect that provision would have been made, by the terms of the trust or trusts created by his mother, for the respective rights and duties of those entitled to reside in the Amsterdam Street home. Yet the plaintiff did not, during the course of his evidence, put forward any terms of trust which covered any rights his mother might have to live on the premises. Such important points as the payment of rent, or its equivalent, and responsibility for payment of outgoings, were likewise not touched upon. On the other hand, the evidence suggests that the plaintiff did not pay, and has never paid, the rates. Yet if he is – as he contends – the owner of the land, the rates are, as between him and his mother, his responsibility.
In Orgee v Orgee[16] the plaintiff succeeded at first instance in establishing an expectation that he would be granted a full agricultural tenancy of a farm owned by his father. Hirst LJ, who gave the leading judgment, considered that on the evidence the judge was very likely wrong in finding that the expectation had been engendered. But he then went on to consider whether, assuming the generation of some expectation or belief that the plaintiff would be granted a full agricultural tenancy, that expectation or belief was of a sufficiently concrete character to enable the Court to give effect to it.
[16]Unreported, Court of Appeal (UK), 5 November 1997.
The result was not in the plaintiff’s favour. His Lordship held that there were, in that case, insuperable difficulties in the form of loose ends which the realisation of the expectation would expose but, having exposed them, could not manage. For example, many of the farm buildings had already fallen down and many of the remaining ones were so dangerous as to require demolition; but there was never any understanding between the parties about how the problem of repairs and dilapidations was to be dealt with.
The agreement postulated by the plaintiff in this case is likewise one which lacks a sufficiently concrete character to enable the Court to give effect to it. This case is therefore to be contrasted with that of Flinn v Flinn,[17] where a relevant expectation was created and, having been created, was acted upon by the plaintiffs. The basis of the expectation was clear: in return for their transformation of a dairy farm, owned by an uncle and aunt of the first plaintiff, from a state of neglect into a modern, efficient operation, the plaintiffs would be given the farm on the death of the last to die of the uncle and aunt. The uncle and aunt promised as much, although one aspect of the promise (the extent of a contribution to be made by the plaintiffs to the first plaintiff’s cousin, the son of the uncle and aunt) was not sufficiently certain to create a contractual relationship.
[17][1999] 3 VR 712.
In the result, the Court found that the evidence which established the fact of the promise, and its terms, was compelling – although the effect of one of the terms was uncertain. What was without doubt was that the plaintiffs gave years of their lives in very burdensome work as a result of which the farm was transformed. During their years of toil, they had received very little, and the uncle and aunt very significant, financial advantage from it. All the same, the latter’s promises to leave the farm in their wills to the plaintiffs appeared to come to nothing when, having become the sole proprietor of the farm on the death of her husband, the aunt changed her will so as to make no provision for her nephew and his wife. The Court of Appeal (Brooking, Charles and Batt JJA) held that the uncertainty of one aspect of the arrangement did not mean that the promise was too uncertain to found a proprietary estoppel.
I have endeavoured to set out, in the preceding portions of this judgment, much of the evidence that points away from the creation of any trust. More is to be found in a series of wills made by Mrs Skyllas. The plaintiff sought to bolster his case by reference to them. In my opinion, their effect is the opposite of that for which he contends.
The case put by the plaintiff is that his mother holds the Amsterdam Street property in trust for him. As a result, he has a present right to reside there, and on his mother’s death will have a right to be registered as its owner in fee simple. Michael too had a right to reside at 20 Amsterdam Street for as long as he lived (and, of course, whenever he was not prevented by his illness from leaving hospital).
Four of the wills made at various times by Anastasia Skyllas have been tendered in evidence in support of these propositions. The first is dated 31 March 2000. By it, the plaintiff is appointed his mother’s executor and trustee, and the beneficiary of all her personal estate. The premises at 20 Amsterdam Street are left to John on trust to hold “for the sole use and benefit of my son Michael Skyllas rent free for his life … but subject to him paying all rates, taxes, maintenance costs and all other outgoings … to the satisfaction of my trustee”. On Michael’s death, John is to sell the property and retain the proceeds. The provision that Michael is, during his lifetime, to pay all rates, taxes maintenance costs and all other outgoings suggests that Mrs Skyllas, and not John, was meeting these expenses when the will was made. This in turn suggests that Mrs Skyllas, and not John, was the owner of the land.
The second will is dated 27 March 2001. By it, Con is appointed executor and trustee. The entire estate, after payment of all taxes and debts, is to be divided among the three brothers.
Save for their respective dates (18 January 2002 and 23 December 2003) the third and fourth wills replicate – word for word in all the operative parts - the first, of 31 March 2000. Each is entirely consistent with the testator exercising all the rights of full legal and beneficial ownership of the Amsterdam Street property, and meeting the outgoings such as the rates. All are drawn as if the plaintiff has no right or interest in the premises - and is to acquire no beneficial interest - until both Michael and his mother are dead. At that point John, as his mother’s trustee, is to hold the land on trust for sale for himself. Indeed, the wills deny Mr Skyllas any rights of possession or occupancy during Michael’s lifetime, because they give the latter “sole use and benefit” of the Richmond property until his death or for so long as he wants to enjoy such use and benefit.
For all these reasons, I am not satisfied on the balance of probabilities that the plaintiff has any interest in the premises at 20 Amsterdam Street, Richmond.
The next question is that of damages. Although by its counterclaim, in all three of its manifestations, the defendant seeks damages pursuant to s.118 of the Transfer of Land Act 1958 for wrongful lodgement of the caveat, that claim was abandoned at trial. Instead, the defendant sought leave to file a further amended defence and counterclaim in which it alleged an entitlement to damages for trespass. I granted that application. On the findings I have made, the plaintiff has been a trespasser since 23 January 2005. And the law is clear. As against a trespasser, the owner of land may claim damages for the trespass, including compensation for being deprived of its use and occupation. This claim is for “mesne profits” and is assessed according to the current value of the land, normally the ordinary letting value.[18] It does not depend on whether the owner of the premises would have been able or willing to let them during the period; and it is distinct from the claim for compensation for use and occupation which lies where there is some kind of tenancy between the parties.
[18]Clifton Securities Ltd v Huntley [1948] 2 All ER 283; Swordheath Properties Ltd v Tabet [1979] 1 WLR 285; Lamru Pty Ltd v Kation Pty Ltd (1998) 44 NSWLR 432.
The defendant called Ms Joanna Bowyer, a senior property manager with Hocking Stuart Richmond Pty Ltd., and Mr Christopher Murphy, a director of that company, on the question of damages. I accept their evidence. Ms Bowyer assessed the rental which would have been obtainable from the property from 23 January 2005. That, as I have previously recorded, was the date of expiry of the period of 60 days’ notice given by State Trustee’s letter of 23 November 2004.
Ms Bowyer first took the 45 weeks from 23 January 2005 to 4 December that year. She assessed the rent which the premises would have attracted over that time as being between $270 and $300 per week. The mid point between those figures is $285. The rental which Mrs Skyllas could expect to have received between those dates would therefore have amounted to 285 x 45 = $12,825.
The quantum of the damages claim thereafter was calculated on the same basis The likely timing and range of increases in the market rental was assessed, and the mid-point of that rental calculated. The resultant figure was then multiplied by the number of weeks between the commencement of the period and the next increase, or until the anticipated end of Mr Skyllas’ occupation (assuming a successful defence of his proceeding).
The next period of Ms Bowyer’s assessment ran from December 2005 to December 2006. She said that the mid-point for rents in Richmond for premises comparable to that at 20 Amsterdam Street was, during the 52 week period in question, $310 per week. That amounts to a total rent of $16,120 for the year. A further increase would have been obtainable in December 2006, and for the following 52 weeks until December 2007 the premises would have attracted a rental per week of $325 or $16,900 for the year. Then in the period December 2007 to 4 February 2008 the rental would have been $390 per week or a total of $3,510 - making a grand total for the period 23 January 2005 to 4 February 2008 of $49,355. In my opinion, the defendant is entitled on its counterclaim to that sum.
By its amended defence and counterclaim, the defendant claims an order that caveat AD286345S be removed from the title to the Amsterdam Street premises. It is entitled to that relief, in addition to the damages to which I have already referred. There will also be an order that the plaintiff provide vacant possession of the property.
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