State of Queensland and Barac

[2004] QSC 40

[2004] QSC 040

SUPREME COURT OF QUEENSLAND
CIVIL JURISDICTION

BYRNE J

No 2263 of 2003

STATE OF QUEENSLAND	Applicant
and
MARIUS OUIDIU BARAC	First Respondent
and
ANGELA PAULA COSMA	Second Respondent
and
AP & MO BARAC PTY LTD	Third Respondent
(ACN 089 560 341)
BRISBANE ..DATE 26/02/2004
ORDER

26022004 T05/ZMS32 M/T 1/2004 (Byrne J)

HIS HONOUR: This application pursuant to sections 37(1) and	1
38(1)(a) of the Criminal Proceeds Confiscation Act 2002 to vary an order of Justice Holmes made restraining dealings in the property of the first respondent concerns the proceeds of sale of a house property at the Gold Coast.

10

The respondents are in a de facto relationship that has subsisted since the early 1990s. The Gold Coast house was their fourth home. Their acquisition of it, which was registered in their names as joint tenants, was financed by

20

borrowings and a payment made by the first respondent.

Of the $620,000 purchase price, $478,000 was borrowed from a financier pursuant to a mortgage, under which both the first and second respondents assumed a liability to the financier to

30

repay the sum advanced and interest.

Consistently with the equitable principles discussed in contributions to the purchase price gives rise to a

40

presumption that the respondents hold their legal estates in
trust for themselves as tenants in common in proportion to
their contributions. For this purpose, the few payments of
instalments made by the second respondent in reduction of the

mortgage debt may be ignored, for they are not to be treated

50

as acquisition costs.

The result is that, in the absence of some other sufficient
contrary intention (see Calverley v. Green at 258), the
26022004 T05/ZMS32 M/T 1/2004 (Byrne J) 2 ORDER 60

contributions to the purchase price were: 61.45 per cent by	1
the first respondent; and 38.55 per cent by the second.
There is no satisfactory basis for a conclusion that the evidence displaces the equitable presumption mentioned.

10

Although the second respondent does depose to the close nature of the relationship between the respondents, all that has been said concerning their intentions when the property was
acquired is this (see subparagraphs (j) and (k) of paragraph 2

of her affidavit filed on 3rd December, 2003): "The first

20

respondent and I have always considered ourselves to be a
joint financial entity and it has always been understood that
we owned each of our properties in equal shares. I have
always had and continue to have authorisation to draw upon all

bank accounts held in the name of the first respondent."

30

This mere conclusory assertion concerning intentions with respect to ownership is not a sufficient foundation for a conclusion that the first respondent intended, in effect, to deprive himself of the benefit of the presumed trust. No

40

facts are deposed to by the second respondent - such as things
the first respondent said or did - to evince a state of mind
on his part inconsistent with the presumed trust arising from
the unequal contributions. And there is no evidence from the

first respondent at all on the topic. (It may also be noted

50

that there is no evidence of any attempt on his part to have
disposed of the benefit of the presumed trust since its
creation at the time of the acquisition of the house).
26022004 T05/ZMS32 M/T 1/2004 (Byrne J) 3 ORDER 60

The presumption not being displaced, 11.45 per cent of the	1
second respondent's beneficial interest in the proceeds of sale is "property" susceptible of a section 37 restraining order.

10

This view involves rejection of several submissions made on behalf of the respondents to which I turn.

First, it was said that section 38(1)(a) cannot be invoked to vary an existing restraint to add property "about which the

20

State has always known and which was previously unrestrained".
Such a restrictive interpretation of sections 37(1) and
38(1)(a) is said to be required for the reason that the
"public interest" may not be taken into account on an

application under section 37, though it falls to be considered

30

in an application for an original restraining order under
section 31.

But the power under 37 is conferred in wide terms. The section stipulates: "(1) the Supreme Court may make the other

40

orders in relation to a restraining order the Court considers
appropriate, including, but not limited to, orders mentioned
in section 38." In view of this ample conferral of
discretionary power, there is no justification for construing

section 37 in such a way as would require the Court to ignore

50

the public interest.

Next it was said that developments since Calverley v. Green
mean that it is no longer appropriate to evaluate beneficial
26022004 T05/ZMS32 M/T 1/2004 (Byrne J) 4 ORDER 60

interests in the property of de facto couples by reference to	1
the principles discussed in that case.
Authorities such as Baumgartner v. Baumgartner (1987) 164 CLR 137 and the analysis they contain of remedies in disputes

10

between disaffected de facto couples and the provisions of
part 19 of the Property Law Act 1974 were said to have

overtaken Calverley v. Green.

True it is that judicial and legislative interventions since

20

1984 have introduced different regimes for the adjustment of under the general law may be significantly altered by remedies granted in judicial proceedings between former de factos. But
rights in property disputes between feuding de facto partners.

30

that says nothing as to the way in which the rights which the
law otherwise establishes are to be regarding pending any such
judicial adjustment. Here the interest of the respondent in
the proceeds of sale is as ascertainable in accordance with

the principles stated in Calverley v. Green.

40

Not content with a restraint that extends to 11.45 per cent of the sale proceeds, the applicant contends that the whole of the second respondent's legal interest in the proceeds ought to be the subject of a restraint. This attempt to establish

50

that her 38.55 per cent proportionate share is also the
property of the first respondent is founded on a contention
that the first respondent may, in all the circumstances, be
taken to have surrendered any rights (for example, to
26022004 T05/ZMS32 M/T 1/2004 (Byrne J) 5 ORDER 60

contribution) which he otherwise had against the second	1
respondent arising from her execution of the mortgage. As it was put by Mr Hinson, "It should be concluded that Ms Cosma's beneficial interest in the property and the proceeds of its
sale was a gift to her from Mr Barac."

10

The evidence does suggest that it is unlikely that the first respondent ever expected to call upon the second to repay any of the mortgage debt, either directly to the financier or, to the extent to which the first respondent paid more than half

20

the mortgage debt, by way of contribution. She was
financially dependent upon him. But that is a far cry from
concluding that, by his conduct, the first respondent evinced
(or had) an intention to surrender any claim he might

afterwards acquire against the second respondent upon payment

30

of more than his share of the mortgage debt. It is one thing
for the first respondent to have expected that he would pay
the whole debt: quite another to conclude that he intended to
abandon such a claim for contribution against the second

respondent should it arise. The evidence does not sustain

40

such an inference.

Finally, it was submitted for the applicant that the house property was, and therefore the whole of the proceeds of sale now are, under the "effective control" of the first respondent

50

(compare section 20(4) of the Act). This bold contention
depends upon the notion that, put tersely (as it was during
argument), the second respondent would do whatever the first
respondent told her to do, at least concerning the house and
26022004 T05/ZMS32 M/T 1/2004 (Byrne J) 6 ORDER 60

the financial arrangements pertaining to it. The evidence	1
falls well short of establishing this.
In the result, the applicant has established an entitlement to a restraining order in respect of the 11.45 per cent

10

mentioned.

...

-----

20

30

40

50

7 ORDER 60