Stillisano v Adami

Case [2010] SASC 351

SUPREME COURT OF SOUTH AUSTRALIA

(Civil)

STILLISANO v ADAMI

[2010] SASC 351

Judgment of The Honourable Justice White

22 December 2010

EQUITY - TRUSTS AND TRUSTEES - CONSTITUTION AND CLASSIFICATION OF TRUSTS GENERALLY - CLASSIFICATION OF TRUSTS IN GENERAL - IMPLIED TRUSTS - CONSTRUCTIVE TRUSTS

EQUITY - TRUSTS AND TRUSTEES - POWERS, DUTIES, RIGHTS AND LIABILITIES OF TRUSTEES - GENERAL MATTERS

Plaintiff transferred property originally purchased in his name to his mother - plaintiff's mother later transferred the property to the defendant, the plaintiff's sister - plaintiff contended that mother had always intended the property to be his and that the defendant held the property on trust for him - defendant denied existence of any trust - defendant further contended that if such a trust existed, the plaintiff was required to reimburse her for maintenance costs of the property.

Held:  the plaintiff's mother did not hold the property on trust for him - the defendant did not take the transfer of the property subject to a constructive trust in favour of the plaintiff - Accordingly, the issue of whether the plaintiff would have been required, if a constructive trust had been found, to reimburse the defendant's expenditure did not, strictly speaking, require determination.

Law of Property Act 1936 (SA) s 29; Law of Property Act 1925  (UK) s 53, referred to.
Hodgson v Marks [1971] Ch 892, discussed.
Muschinski v Dodds (1985) 160 CLR 583; Baumgartner v Baumgartner (1987) 164 CLR 137; Parij v Parij (1997) 72 SASR 153; Registrar of the Accident Compensation Tribunal v Federal Commissioner of Taxation (1993) 178 CLR 145; Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107; Calverley v Green (1984) 155 CLR 242; Miller Street Pty Ltd v Parker [2007] FCA 1830, considered.

STILLISANO v ADAMI
[2010] SASC 351

Civil

  1. WHITE J. These proceedings arise out of a dispute between a brother and a sister as to the ownership of the property at 16 Sabina Street, Salisbury.  The property has been registered in the name of the defendant (Teresa) since August 2003.  The plaintiff (Giorgio) contends that Teresa holds the legal interest in the Sabina Street property subject to a constructive trust in his favour and he seeks orders from this Court to that effect.  Teresa denies Giorgio’s claim.  In the event that this Court upholds the claim, Teresa seeks reimbursement of the sums which she has spent on utilities and in maintaining the Sabina Street property.

    Non-Contentious Background

  2. Giorgio, Teresa and their sister, Caterina, are the children of Domenica Stillisano.  Each was born in Italy:  Giorgio in 1951, Caterina in 1958 and Teresa in 1960.  Their father died in Italy when they were all quite young.  Giorgio emigrated to Australia at 14 years of age in 1965.  Domenica and the two girls emigrated in 1968.  Giorgio has had no schooling in Australia but both Caterina and Teresa completed their education here.

  3. The Stillisano family has been involved in the purchase…

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Stillisano v Adami [2010] SASC 351
Case
[2010] SASC 351
Decision Date

CaseChat Overview and Summary

In the matter of Stillisano v Adami, the dispute arose when the plaintiff, Giorgio Stillisano, sought to assert a claim over a property located at Sabina Street. Giorgio contended that the property, originally purchased in his name, should be held on trust for him by his mother, Domenica, and subsequently by his sister, Teresa Adami, who had taken possession of the property. He argued that Domenica always intended for the property to be his and that Teresa held it in trust for him. Teresa denied any trust existed and argued that if it did, Giorgio should reimburse her for the maintenance costs incurred. The case was heard and determined in the Supreme Court of South Australia.

The primary legal issue was whether Domenica had intended the property to be held on trust for Giorgio, and if so, whether Teresa took the property subject to a constructive trust in his favour. A secondary issue was whether, if a constructive trust existed, Giorgio would be required to reimburse Teresa for maintenance costs.

The court found that Domenica did not hold the property on trust for Giorgio and that Teresa did not take the property subject to a constructive trust in his favour. The court's decision was based on the understanding that Sabina Street was purchased as the family home, not as a beneficial interest for Giorgio. The court noted that Domenica had engaged in paid employment, contributing to the family's finances, which made it less likely that Giorgio was the sole source of funds for the property. The court did not need to address the issue of reimbursement as no constructive trust was found.

In conclusion, the court dismissed Giorgio's claim. The final orders were to be determined following further submissions from the parties regarding the appropriate order in relation to the cross-action.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

The parties did address some submission to the nature of Giorgio’s legal ownership of Sabina Street from the time of its purchase until he transferred it to Domenica on 26 October 1982. In particular, the parties’ submissions addressed the question of whether Giorgio owned both the legal and beneficial interests in the property in that period or whether, because it was Domenica who was the immediate provider of the monies used for its purchase, Giorgio owned Sabina Street subject to a resulting trust in her favour. The latter alternative also involved the possible application of the presumption of advancement.[11] However, in the end, I have not thought it necessary to resolve these issues. I consider that it is reasonably plain that although Sabina Street was purchased in Giorgio’s name, it was the common understanding of Domenica and Giorgio that it was purchased as the family home of the Stillisano family. In other words, I am satisfied that Sabina Street was not purchased by Giorgio as the legal and beneficial owner but with him then allowing his family to reside in it. [11] Calverley v Green (1984) 155 CLR 242.The Evidence at the Trial Giorgio gave evidence himself and led evidence from his sister, Caterina. Teresa gave evidence in her own defence and also led evidence from her husband, Robert, and from her brother‑in‑law, Rocco Adami. Domenica was not called by either party to give evidence. Although Domenica may once have been able to have cast considerable light on the issues in dispute, it was common ground that she is now too frail to give evidence. It was not suggested that any adverse inference should be drawn because of the failure of either sibling to call her to give evidence. Giorgio was the only person who gave evidence as to his conversation with his mother in 1982 which he relied upon for the creation of the resulting trust at that time. Having referred to his mother’s concerns about her security in the house, Giorgio said that he said to Domenica:You can live here in the house … for the rest of your life if you want to. But if you ever move out I want the papers, all right. … Remember that the house is still always mine.[12]Giorgio did not give evidence of his mother’s response to that statement but, on his account, it was at least implicit that his mother acknowledged his stipulated conditions.[12] Transcript p 43. In addition to this express evidence of an oral trust, Giorgio gave evidence of other circumstances to support the plausibility of his account. Each of the other witnesses also gave evidence of a circumstantial kind. I summarise the circumstantial evidence relied upon by Giorgio as follows:1.As the only male in a family adhering to “traditional Italian family values”, he had accepted the responsibility at an early age of providing for his mother and sisters. This included the responsibility of providing a house for them. Once Sabina Street was purchased, it was his intention that his mother be able to reside there as long as she wished and that his sisters would reside there until their marriages.2.After his mother and sisters came to Australia, it was his practice to give to Domenica unopened his pay packet from GMH. He intended that his mother should be able to use and distribute the contents of his pay packet as she saw fit. 3.Until Caterina started work in mid 1975 and did the same thing, his wages were the principal source of income for the family. Domenica’s only other source of income was a pension (presumably an Australian Social Security Pension) as she did not work in paid employment in Australia.4.For the purchase of Sabina Street, his mother used $10,000 in cash which she had accumulated from his pay packets. The inference was that this made it even more understandable that he was the true purchaser of Sabina Street.5.Giorgio said that he was able to give his mother his complete pay packets because he had additional work in market gardens and the like at weekends and he used the earnings from those jobs for his own purposes.6.Giorgio continued to give his mother his pay packets unopened after Sabina Street was purchased and he understood that Domenica used those monies to meet the monthly mortgage instalment of $49.7.Even after he moved out of the Sabina Street in 1975 to live with his future wife before their marriage (something of which Domenica disapproved) he continued to provide his mother with the money for the mortgage repayments.8.Domenica’s insistence that he transfer Sabina Street to her coincided with his foreshadowed marriage to his wife in November 1982. The inference was that it was only his mother’s concerns about the marriage which prompted her request to him to transfer the property to her.

Decision

Reasons for decision

WHITE J
As the parties agreed Teresa’s entitlement in relation to the first eight items at $8,000, I would, had it been necessary to do so, have allowed Teresa to recover that sum.Conclusion For the reasons given above, I dismiss Giorgio’s claim. I will hear from the parties as to the appropriate order to be made in relation to the cross-action.

Ratio Decidendi

Legal Principle Established

Established by: WHITE J

I consider that the evidence of both Rocco and Robert Adami was generally reliable.Consideration of First Issue The issue of whether Domenica had engaged in paid employment in Australia related to the source of the funds used to purchase Sabina Street. That in turn related to the claim of Giorgio that Sabina Street was his, because he had been the source of the funds used to acquire it and had provided those funds in the discharge of his obligation as the only male to provide a home for his family. Given the straight out conflict between the parties as to whether Domenica had engaged in any paid employment, it is surprising how little evidence was led on the topic. Counsel for Teresa said that he was unaware until Giorgio and Caterina gave their evidence that there was any dispute about the matter. This left him and his instructors with little time to gather evidence on the issue and explained the lack of any documentary materials which may have evidenced Domenica’s work. It also explained the absence of evidence led by Teresa from persons unconnected with either party, such as the persons for whom, or with whom, Domenica was said to work, or neighbours who may have been able to cast light on Domenica’s daily activities. If Domenica was not working at all, this must have been known by many people associated with the Stillisano family. It is not clear why Giorgio did not lead any evidence, apart from Caterina, as to his mother not having engaged in paid work. Perhaps counsel for Giorgio was also taken by surprise to find that there was disagreement about this issue. In any event, the Court must assess the oral evidence without having available to it all the evidence which may possibly have been led. I am satisfied that each of Giorgio and Caterina was wrong in saying that Domenica did not engage in paid employment in Australia. In reaching that conclusion I rely particularly on the evidence of Rocco and Robert Adami who, as indicated above, I considered to be generally reliable witnesses. As noted earlier, from time to time Rocco saw Domenica at work at Zerella Farms in the period 1975 to 1983 and Robert assisted in her transport to and from work after she moved to West Lakes in 1985. Although both these periods are after the time when Sabina Street was bought, they do indicate that Domenica was a participant in the workforce. There is no reason to suppose that that participation commenced only in 1975. In addition, I think it significant that, despite Domenica and the two girls having arrived in Australia only in 1968, between July 1972 and March 1979 the Stillisano family was able to purchase four separate properties. Without Domenica’s earnings, I doubt that the family could, by 1982, have accumulated the $10,000 in savings which was used in part payment of Sabina Street. On the evidence of Giorgio and Caterina, in the period from 1968 until mid 1973 when Caterina started work, the family would have been relying solely on Giorgio’s earnings together with Domenica’s pension. When one bears in mind that in 1968, Giorgio was only 17 years of age and probably not earning a full adult wage, and had purchased and was paying the running costs of a car, it seems quite unlikely that his income would have allowed the family, after deduction of ordinary living expenses, to accumulate $10,000 in savings over a four year period. I add that Giorgio himself thought that between 1968 and 1972 he was receiving between $20 and $40 net each week in his pay packet. This may well have been an underestimate. Nevertheless, it indicates the difficulties the family would have had, if reliant only upon his income and a pension, to sustain themselves.