Thynne v Sheringham

Case [2023] NSWCA 181

Court of Appeal


Supreme Court


New South Wales

Medium Neutral Citation: Thynne v Sheringham [2023] NSWCA 181
Hearing dates: 4 July 2023
Date of orders: 9 August 2023
Decision date: 09 August 2023
Before: Ward ACJ and Kirk JA at [1];
Basten AJA at [16]
Decision:

(1)   Grant the applicant leave to appeal from the judgment in the Equity Division of 22 December 2022.

(2)   Direct that the applicant file within seven days a notice of appeal in the terms of the draft notice contained in the white folder and dispense with service.

(3)   Dismiss the appeal.

(4)   Order that the appellant pay the respondent’s costs in this Court.

Catchwords:

EQUITY – trusts and trustees – mutual wills –memorandum of wishes – agreement that surviving spouse would leave property or proceeds of sale to sons of testator – power to expend proceeds for own needs – nature of trust arising at time of testator’s death – floating obligation that crystallises on repudiation of agreement

REAL PROPERTY – caveats – property acquired under will – owner subject to equitable obligation to leave property in accordance with agreement with testator – power to sell and expend proceeds of sale – whether the intended beneficiary under the agreement has a caveatable interest in the land

Legislation Cited:

Real Property Act 1900 (NSW), s 74F

Cases Cited:

Barns v Barns (2003) 214 CLR 169; [2003] HCA 9

Birmingham v Renfrew (1937) 57 CLR 666; [1937] HCA 52

Depsun Pty Ltd v Tahore Holdings Pty Ltd (1990) 5 BPR 11

Double Bay Newspapers Pty Ltd v A W Holdings Pty Ltd (1996) 42 NSWLR 409

Dufour v Pereira 1 Dick 419; 21 ER 332

Flocas v Carlson [2015] VSC 221

Forster v Forster [2022] QSC 30

Giumelli v Giumelli (1999) 196 CLR 101; [1999] HCA 10

Latec Investments Ltd v Hotel Terrigal Pty Ltd (in liq) (1965) 113 CLR 265; [1965] HCA 17

Masci v Masci [2015] QCA 245

Muschinski v Dodds (1985) 160 CLR 583; [1985] HCA 78

Palmer v Bank of New South Wales (1975) 133 CLR 150; [1975] HCA 51

Re Hagger [1930] 2 Ch 190

Westminster Bank Ltd v Lee [1956] 1 Ch 7

Texts Cited:

C E F Rickett, “Mutual Wills and the Law of Restitution” (1989) 105 LQR 534

Daniel Reynolds, “What are the Duties of Constructive Trustees?” (2018) 41 UNSW Law Journal 1297

Ford and Lee, Principles of the Law of Trusts, (2nd ed, Law Book Co, 1990)

Glister and Lee, Hanbury & Martin – Modern Equity (21st ed, 2018, Thomson Reuters)

Heydon and Leeming, Jacobs’ Law of Trusts in Australia (8th ed, LexisNexis, 2016)

Jacobs, The Law of Trusts in New South Wales (Butterworths, 1958)

Meagher and Trevorah, Jacobs’ Law of Trusts in New South Wales (2nd ed, Butterworths, 1967)

Rosalind Croucher, “Mutual Wills: Contemporary Reflections on an Old Doctrine” (2005) 29(2) Melb U L Rev 390

Category:Principal judgment
Parties: Harry Bernard Thynne (Applicant)
Jevny Pty Limited ACN 001737864…

Continue reading Thynne v Sheringham

Sign in free to access the full text

Details
AGLC
Thynne v Sheringham [2023] NSWCA 181
Case
[2023] NSWCA 181
Decision Date

CaseChat Overview and Summary

Thynne v Sheringham concerned a dispute between a surviving spouse and the sons of her deceased husband regarding their entitlement to property. The sons alleged that their father and stepmother had entered into a mutual wills agreement, whereby the surviving spouse was to hold the property, or its proceeds of sale, for their benefit. The surviving spouse, however, had sold the property and used the proceeds for her own purposes, leading to the sons seeking to establish a trust over the property and lodge a caveat. The matter came before the Court of Appeal of New South Wales.

The primary legal issues before the Court of Appeal were whether a mutual wills agreement had been established, and if so, what was the nature of the equitable obligation imposed on the surviving spouse. Specifically, the court had to determine whether the surviving spouse's power to expend the proceeds of sale for her own needs was compatible with the existence of a trust in favour of the sons, and whether this equitable obligation gave the sons a caveatable interest in the land.

The Court of Appeal affirmed the decision of the primary judge, finding that a mutual wills agreement had been established. The court held that the trust arose at the time of the testator's death, creating a floating obligation on the surviving spouse to preserve the property or its proceeds for the beneficiaries. This obligation crystallised upon the surviving spouse's repudiation of the agreement by selling the property and expending the proceeds. The court concluded that this equitable obligation constituted a caveatable interest in the land, as it represented a proprietary claim that could be enforced against the property.

The Court of Appeal granted the applicant leave to appeal but ultimately dismissed the appeal, ordering the appellant to pay the respondent’s costs.

Orders

Orders of the court

(1) Grant the applicant leave to appeal from the judgment in the Equity Division of 22 December 2022.

(2) Direct that the applicant file within seven days a notice of appeal in the terms of the draft notice contained in the white folder and dispense with service.

(3) Dismiss the appeal.

(4) Order that the appellant pay the respondent’s costs in this Court.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.