Willets v Marks

[1994] QCA 6

IN THE COURT OF APPEAL	[1994] QCA 006
SUPREME COURT OF QUEENSLAND

Appeal No. 115 of 1993

Before The President
Mr Justice McPherson
Mr Justice Davies

[Willetts v. Marks & anor.]

BETWEEN:

ERIC GORDON WILLETTS

(Plaintiff) Appellant

- and -

THOMAS HENRY MARKS and SKRAM
INVESTMENTS PTY.LTD.

(Defendants) Respondents

REASONS FOR JUDGMENT - THE PRESIDENT

Judgment delivered 14/02/94

This is an appeal from a judgment delivered in the Trial Division on 3 June 1993. The appellant's action was dismissed although the trial judge accepted him as a credible witness and believed his evidence. His claim is brought against the first respondent personally and as the executor of the Will of Pansy Esther Marks (deceased) and against the second respondent personally and as the trustee

of the Pansy Esther Marks Family Unit Trust. The first
respondent is the son of the late Mrs. Marks, and at
material times was a shareholder in the second respondent.
The first respondent and his wife were and are the directors
of the second respondent and the shareholders in, and
directors of, another company, T.H. Marks Pty Ltd, the
beneficiary under the Family Unit Trust.

In 1949, the appellant, at the request of Mrs. Marks, left his secure employment in Brisbane and went to live with Mrs. Marks, a widow, on her farm at Atherton. Thereafter, they cohabited continuously in a de facto married relationship until her death on 31 January 1980.

The appellant went to Atherton to manage Mrs. Marks' farm following a promise by her that, if he did so, she would share any subsequent increase in her land holdings with him. In the words of the trial judge "[the appellant] went on to make a great contribution to the building up of Mrs. Marks' estate, both in the profitable running and development of the farm and in her acquisition of ... further properties, financed at least in part through profits generated by that farming operation."

"Newells' Swamp" was acquired in 1952, "Back of Bishop's" and "Walmsley's" (Portion 192 and Miners' Homestead Leases) in 1953, "Font Hills" in 1954, "Pavey's" (Portions 90 and 90A and a Special Lease) in 1963 and "Cozens" (Portion 191) in 1965. Again to quote the trial judge, "... as she progressively acquired these further properties, she did not register the [appellant] and herself as joint tenants or tenants in common. She registered them in her own name only. Although that was arguably inconsistent with at least the spirit of her promise made to the [appellant] in 1949, the [appellant] did not take any steps to ensure that any interest was recorded in his name."

Nor did the appellant receive wages as such. As found by the trial judge, Mrs. Marks "provided him with the money he required from time to time, she paid for his clothes and food and provided accommodation, he had the use of a car, and his relationship with her probably enhanced his standing in the community, which was .... of some importance to him."
The appellant and Mrs. Marks had a further conversation concerning his entitlements in 1972. The trial judge accepted the following account given by the appellant of that conversation.

"Will you tell us what was said in this
conversation? --

Yes. I said, 'It's a long time since 1949' - 'since I promised to come and live with you and help you out. You had two properties' - 'you had one property then and you said then that that had

to be for your two boys. You have said so many times that you will - my future was secure, that I would never want' I told her then that she was the biggest land owner in the Atherton Shire at that particular time, and that she had said - she said then at that particular time if we were able to acquire other land she would share with me.

Yes?-- She said, 'Yes. I can thank you for that. You insisted that I purchase these properties. I intend to leave you Walmsley's, Cozens' and Paveys'.' Pavey's has a small house. We discussed this when we visited them first, when we inspected the house. She said. 'You'll need cattle. I'll lease you - how many cattle have we?' I said, 'About 600.' She said, 'I'll give you 250 head of cattle. I intend to leave Font Hill and Newell Swamp to my grandson Malcolm. You and Malcolm have been fairly close. I hope you can work together.

Is that it?-- That's it, yeah."

The appellant continued to manage the farm but, some

years later, unbeknown to him, Mrs. Marks broke her promise.
On 28 May 1976, she established the Pansy Esther Marks
Family Unit Trust with the second respondent, Skram
Investments Pty. Ltd., as trustee. In the following month,
she also executed a "Vesting Deed", which purported to vest
the beneficial ownership of her properties, including the
"Walmsley's", "Pavey's" and "Cozens" properties, in the
second respondent as trustee of the trust. Earlier, on 4
June 1976, Mrs. Marks had executed her last Will, appointing

the first respondent her executor and leaving all her

property to him.

As previously noted, Mrs. Marks died on 31 January 1980, and the first respondent was granted probate of her Will on 23 June that year. When the appellant was turned out by the first respondent in May 1980, a few months after Mrs. Marks' death, he had only his personal possessions.

In 1976/1977, parts of "Walmsley's" (the Miner's Homestead Leases) and "Pavey's" (Portions 90 and 90A) had been transferred to the second respondent. Notwithstanding the Vesting Deed, the remainder of those properties and "Cozens" were never transferred to the second respondent but were transferred to the first respondent as executor of Mrs. Marks' Will in 1980/81, and in 1981 were transferred to him in his personal capacity. It seems to have been accepted by all parties, and I approach the matter on the footing, that the properties not transferred to the second respondent were unaffected by the Vesting Deed and remained the property of Mrs. Marks until her death, passing then to the first respondent as her executor and then to him as the beneficiary of her estate.

All three properties, "Walmsley's", 'Pavey's" and "Cozens", were subsequently sold by either the first respondent or the second respondent to third parties in 1982, 1984 and 1985. "Cozens" and part of "Walmsley's" (Portion 192) were sold by the first respondent in 1982; the balance of Walmsley's (Miner's Homestead Leases) was sold by the second respondent in 1984; part of "Pavey's" (Portions 90 and 90A) was sold by the second respondent and the balance of "Pavey's" (the Special Lease) was sold by the first respondent in 1985.

Meanwhile, the present disputes had arisen.
On 28 March 1980, the appellant had filed a caveat

against the grant of probate in respect of Mrs. Marks' Will. By a memorandum of appearance filed on 23 May 1980, the appellant claimed to be entitled to a beneficial interest in "Cozens" (Portion 191), part of "Walmsley's" (Portion 192), part of "Pavey's" (Portions 90 and 90A) and 250 head of cattle. (It is convenient to omit further reference to the cattle, which played little part in the argument in this Court.) The appellant later consented to the grant of probate to the first respondent on 23 June 1980.

On 31 October 1980, the appellant lodged a caveat in the Office of the Registrar of Titles at Townsville to prevent any dealings with part of "Pavey's" (Portions 90 and 90A) and, in an affidavit later filed in March 1982 in a proceeding to remove that caveat, he claimed beneficial ownership of those "Pavey's" portions, "Cozens" and part of "Walmsley's" (Portion 192). This caveat was removed by consent on 22 June 1982.

By then, on 14 January 1981, the appellant had instituted the present action, in which the trial did not commence until November 1992 and evidence was not completed until May 1993. Paragraphs 14 and 15 of the respondents' Amended Defence set up pleas of acquiescence and laches, relying upon the appellant's conduct in relation to (i) the probate caveat and (ii) the real property caveat and delays in the prosecution of the action, which involved two periods in which no step was taken for about a year, another period in which no step was taken for approximately 21 months, and another period in which no step was taken for over three years. It should be said immediately that these defences were not the subject of findings or rulings by the primary judge and this Court is not in a position to do so satisfactorily, particularly since, on a chronology which was handed to the Court, it seems that the respondents may have been responsible for a significant part of the time taken for the action to be brought on for hearing.

If the appellant is otherwise entitled to succeed, these are not the only issues which should go back to the Trial Division. Issues might then arise concerning (i) the knowledge of the appellant's rights or interests which was held at material times by the second respondent and perhaps the first respondent's company, T.H. Marks Pty. Ltd., the beneficiary under the family trust, and (ii) what, if any, consideration was given for their interests. Another issue is the amount to be awarded to the appellant, which is not discussed at all in the judgment under appeal. At least in relation to the claim against the first respondent in his capacity as executor of the estate of Mrs. Marks, there may also be an issue related to the extent to which the administration of the estate was or has been completed (Amended Defence, para. 12).

It is not entirely clear how the case was conducted below, or whether the appellant's claim was in accordance with his Further Amended Statement of Claim, which is by no means an easy pleading to digest. On this appeal, and according to the judgment appealed from in the court below, although the parties' 1949 bargain was referred to, the appellant's case was substantially founded on the 1972 promise. In the circumstances, I propose to proceed by reference to the later promise. Whether the 1949 bargain initially gave rise to a resulting trust or even constituted a binding contract, it seems that it was abandoned by, or in, 1972 (cf Cheshire & Fifoot's Law of Contract, 6th Australian Edition (1992) para. 2009), or at least that, with the appellant's consent or acquiescence, Mrs. Marks' 1972 promise was substituted for her 1949 commitment.

At its simplest, the appellants' case seems to be that Mrs. Marks broke her 1972 contract to leave him "Walmsley's", "Pavey's" and "Cozens" (and the cattle) by her will. The benefit of this right of action is claimed against the first respondent as executor of Mrs. Marks' will and perhaps against him in his personal capacity as the beneficiary under that will.

That claim cannot succeed. The trial judge thought that the appellant did not provide consideration for Mrs. Marks' 1972 promise, but I am not persuaded of that. That promise may simply have been substituted for her 1949 promise, in return for which he had worked and built up her estate.

Further, an act done before the giving of a promise to confer a benefit is valid consideration for that promise if the act has been done at the promisor's request, the parties understood that the act was to be remunerated by the conferment of a benefit, and the conferment of the benefit would have been enforceable if it had been promised in advance: Re Douglas; ex parte Starkey (1987) 75 ALR 97, 102, citing Pao On v. Lau Yui Long (1980) AC 614.

Additional consideration may also have been provided by the services which the appellant continued to perform in and after 1972 at the deceased's implicit request that he do so: Brausch v. Watts Development Division Pty. Ltd. (1987) 10 NSWLR 311. However, it is unnecessary to pursue the point.

On the view most favourable to the appellant, the facts are indistinguishable from Maddison v. Alderson (1883) 9 App.Cas. 467. In that case, the appellant lived for many years as the housekeeper for a landowner and continued to serve him in that capacity, without wages, until his death.

She was induced to do so by a promise, made by him to her, to make a will leaving her a life estate in his farm. He had a will prepared for that purpose which he signed, but which failed for want of due attestation. The appellant lost her action against the landowner's heir for a declaration that she was entitled to a life estate in the land.

The House of Lords held that there was no contract between the appellant and the deceased. The leading judgment was delivered by the Earl of Selborne L.C., with whom Lords O'Hagan and Fitzgerald agreed, although also stating their own reasons. After holding that there was no contract (p.472), the Lord Chancellor held that, in any event, there was no sufficient performance by the appellant to permit enforcement notwithstanding the Statute of Frauds (cf. section 59 of the Law Of Property Act 1974): see pp.475-476, 478, 479, 480-481. This aspect of the case has subsequently been approved and adopted by the House of Lords in Steadman v. Steadman (1976) AC 536 and the High Court in Regent v. Millett (1976) 133 CLR 679. See also Horton v. Jones (1935) 53 CLR 475 and Palmer v. Bank of N.S.W. (1975) 133 CLR 150.

Estoppel was also briefly considered and rejected in Maddison v. Alderson. At pp.473-474, the Lord Chancellor said:

"I have always understood it to have been decided in Jorden v. Money (5 HLC 185) that the doctrine of estoppel by representation is applicable only to representations as to some state of facts alleged to be at the time actually in existence, and not to promises de futuro, which, if binding at all, must be binding as contracts ...".

However, see now Walton Stores (Interstate) Limited v. Maher (1988) 164 CLR 387, 428 per Brennan J, and The Commonwealth v. Verwayen [1990] 170 CLR 394, 410-411 per Mason CJ and 443 per Deane J.

It appears to be the foundation of the appellant's alternative claim that (i) he became beneficially interested in the "Walmsley's", "Pavey's" and "Cozens" properties consequent upon Mrs. Marks' promise in 1972, and (ii) the dealings with the properties in favour of the respondents (pursuant to the Vesting Deed and Mrs. Marks' Will and the transfers) did not detract from his beneficial interest (perhaps because the transfers were in breach of trust to the knowledge of the transferees), or (iii) in any event those transfers to the respondents were made in breach of trust. Further, when the properties were sold by the respondents to third parties (whose titles are not challenged), the sales of the properties were in breach of trust. The appellant's claim to damages is apparently related to these breaches. It was not argued for the respondents that, if the appellant is entitled to succeed, damages are not an available remedy.

It is questionable whether Mrs. Marks' continued ownership of the "Walmsley's", "Pavey's" and "Cozens" properties in and after 1972, conformably with her 1972 promise, was consistent with the appellant having an equitable interest in those properties consequent upon that promise. Palmer v. Bank of N.S.W. seems to suggest, by the conclusion that the promisor may dispose of the property during his lifetime, that an enforceable promise to leave an estate by will does not give the promisee an immediate equitable interest in the property. Statements in Birmingham v. Renfrew (1937) 56 CLR 666, per Dixon J. at p. 683, and Schaefer v. Schuman (1972) AC 572, per Lord Wilberforce, Lord Parker, Lord Hodson and Lord Cross at p. 587, suggest to the contrary. It is unnecessary to seek to resolve this; as indicated above, the promise by Mrs. Marks did not place her under a contractual obligation. It remains to be considered whether a trust with respect to an interest in the properties otherwise arose or should be declared in favour of the appellant in accordance with equitable principles.

A foundation for the imposition of a constructive trust is that a refusal to recognise that a beneficial interest in property exists may amount to unconscionable conduct and a constructive trust "is imposed as a remedy to circumvent that unconscionable conduct": Baumgartner v. Baumgartner (1987) 164 C.L.R. 137, 147; see also p.148. Compare the similar resort to unconscionability as a foundation for the doctrines of promissory estoppel and proprietary estoppel

or estoppel by acquiescence (Walton Stores v. Maher, pp.403, 404), unjust enrichment (Baumgartner at pp.151 ff per Toohey J; Bryson v. Bryant (1992) 29 NSWLR 188), and reasonable expectations (Phillips v. Phillips (1993) 3 NZLR 159 per Cooke P. at p. 167). In Walton Stores v. Maher, after referring to the discernible "common thread which links" the cases, Mason CJ. and Wilson J. said at p. 404:

"Equity comes to the relief of ... a plaintiff on the footing that it would be unconscionable conduct on the part of the other party to ignore the [parties' basic] assumption."

What is unconscionable conduct is to be decided by reference to equitable principles, not subjective notions of what is just and fair, although "... general notions of fairness and justice are relevant to ... unconscionable conduct ..." : Baumgartner at p. 148; Bryson v. Bryant. In the latter case, Samuels A.J.A. at p.223 said of such views that they reflect the fact "that no judge is free to indulge his own personal views of what justice requires without regard to prevailing legal principles, and so far as any judge can determine them, current social attitudes".

In Muschinski v. Dodds (1985) 160 CLR 583, Deane J,
with whom Mason J agreed, said at p. 616 that the "principal
operation of the constructive trust in the law of this
country has been in the area of breach of fiduciary duty".
However, there is now a substantial body of authority, of
which that case itself forms part, dealing with the use by
equity of the remedy of a constructive trust with reference
to property acquired through joint efforts in the name of
one party to a domestic relationship which terminates
without attributable blame, eg., by death, "in circumstances
in which it was not specifically intended or specially
provided" that the party in whose name it is held should
exclusively enjoy it. "The content of the principle is such
that, in such a case, equity will not permit that ... party
to assert or retain the benefit of the relevant property to
the extent that it would be unconscionable for him so to
do": Muschinski v. Dodds at p. 620; Baumgartner at pp. 147
and 148, and compare the Canadian cases in which a similar
result is achieved through a doctrine of unjust enrichment:

eg., Rathwell v. Rathwell (1978) 83 DLR (3d) 289; Pettkus v. Becker (1980) 117 DLR (3d) 257; Sorochan v. Sorochan (1986) 29 DLR (4th) 1.

A conclusion in favour of such a trust does not depend on a presumption based upon the appellant's contribution to the acquisition of the properties, or on a premise that the appellant and Mrs. Marks had a common intention that the appellant should have an equitable interest in the "Walmsley's", "Pavey's" and "Cozens" properties, so giving rise to a resulting trust. That may initially have been so, based on her 1949 promise, but it was not their final intention, which was that she should leave him those properties by will. A constructive trust is not dependent upon the parties' intention but is imposed (and subsequently protected) by equity, "regardless of actual or presumed agreement or intention ... to preclude the retention or assertion of beneficial ownership of property to the extent that such retention or assertion would be contrary to equitable principle": Muschinski v. Dodds p. 614; Baumgartner; Bryson v. Bryant. The constructive trust is a remedy provided by equity as an answer to unconscionability.

"As an equitable remedy it should ... be seen as constituting an in personam remedy attaching to property which may be moulded and adjusted to give effect to the application and interplay of equitable principles and the circumstances of the particular case": Bryson v. Bryant at p. 218 per Sheller J.A.

Notwithstanding the cautionary sentiments with respect to judicial idiosyncrasy which are to be found in the cases and the diffidence I feel in departing from the decision of the trial judge, I have little hesitation in concluding that there was unconscionable conduct by Mrs. Marks and the first respondent as her executor and beneficiary which entitled the appellant to a constructive trust in respect of so much of the "Walmsley's", "Pavey's" and "Cozens" properties as passed under Mrs. Marks' will. While giving appropriate weight to the view of the trial judge, I cannot agree that "the evidence does not reasonably permit the conclusion that he was not adequately recompensed ...". The long relationship between the appellant and Mrs. Marks, the promises which she made to him, the work which he performed without wages for many years and the contribution which he made to the increase of her estate combined to make it unconscionable for her promise to be ignored and the properties disposed of, contrary to the promise, leaving him with nothing. The circumstances that Mrs. Marks is dead and the properties passed to the first respondent as her executor and beneficiary and have since been sold do not defeat the appellant's claim in personam against the first respondent: cf Bryson v. Bryant at pp. 210-211 per Kirby P.

Summary

The appellant is entitled to succeed against the first respondent, subject to the matters raised by paras. 12, 14 and 15 of the Amended Defence and to any question which the first respondent is entitled to raise with respect to the appellant's right to damages.

Whether or not the appellant is entitled to succeed against the second respondent depends on similar matters and perhaps on further issues with respect to whether the second respondent (or perhaps T H Marks Pty Ltd) was a volunteer or purchaser for value and whether or not either had notice of the appellant's interest at material times.

It is regrettable, but unavoidable, that these points must go back to the Trial Division. In his reasons for judgment, the trial judge offered to make further factual findings if so required by the parties and hopefully he is in a position to do so with the minimum of further expense to the parties. If not, the outstanding issues will have to be retried.

For the moment, the course to be followed by this Court is to allow the appeal with costs to be taxed, set aside the judgment dismissing the appellant's action and the orders for costs made below and refer the action back to the Trial Division for the determination of outstanding issues. The costs of the proceedings to date, other than the costs of this appeal, are reserved to the trial judge who hears the remitted issues.

THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 115 of 1993

Brisbane

Before The President
Mr Justice McPherson
Mr Justice Davies

[Willets v. Marks & Skram Investments P/L]

BETWEEN

ERIC GORDON WILLETS

(Plaintiff) Appellant

AND

THOMAS HENRY MARKS and
SKRAM INVESTMENTS PTY LTD

(Defendants) Respondents

REASONS FOR JUDGMENT - McPHERSON J.A.

Judgment delivered the Fourteenth day of February 1994

This is an appeal by the plaintiff from a judgment in the Supreme Court dismissing his claim for relief in an action concerning three parcels of farm land known as Walmsley's, Cozens, and Pavey's, on the Atherton Tableland.

The action has its origins in events that took place a long time ago. The account of what happened is found principally in the evidence of the plaintiff, who was accepted by the trial judge as a credible witness.

The plaintiff was born in 1914, married in 1931, and has six children of his own. He joined the A.I.F. in World War II, served in various theatres of war, and afterwards with the army of occupation in Japan. In 1944 he met Pansy Esther Marks and her husband. They had two sons, and lived on a property at Marks Lane, Atherton Tableland, which is referred to in the evidence as the home farm. They became friendly and in 1946 the plaintiff spent some of his leave with them. While overseas in 1947 he learned from Mrs Marks that her husband had died. On his return to Australia early in 1949 he visited her on the Tableland. In May of that year he went to live with her there, following which they cohabited continuously until her death on 31 January, 1980.

In the amended statement of claim in the action two
bases for the plaintiff's claim to the land are put forward.
The first is an arrangement made in 1949, in terms of which
Mrs Marks assured the plaintiff that if he came to Atherton
and managed the home farm for her, she would share with him
any subsequent increase in her land holdings. The word
"increase" referred to land subsequently acquired by her
apart from the home farm in Marks Lane, which her late
husband had left to her and which was destined for her sons.
On the strength of her assurance the plaintiff gave up
steady employment in Brisbane and went to live with Mrs
Marks. For many years he managed the home farm, contributing
greatly to its success and profits, which were then used by
her in the purchase in her own name of the properties that
are the subject of this action. By this means she acquired
in all six more holdings, which are sufficiently identified,
together with the year of each purchase, as Newell's Swamp

(1952), Back of Bishops (1953), Walmsley's (1953), Font

Hills (1954), Pavey's (1963), and Cozens (1965).

Consistently with the 1949 arrangement, it would be possible to view these properties as having been acquired by Mrs Marks as trustee for herself and the plaintiff as tenants in common in equity. The terms of the 1949 arrangement as proved at the trial do not distinctly specify the quantum of the share that each of them was to take; but, given the nature of the arrangement and equity's traditional predilection for equality of interest, it might be possible to infer that the parties intended their shares to be equal.

Each of the properties was acquired in the name of Mrs Marks alone; but in equity a purchase by one person undertaken on behalf of himself or herself and another readily yields the result that the purchaser acquires as trustee for both.

Difficulties apparently occasioned by the absence of writing and the provisions of the Statute of Frauds (which is pleaded in the defence here) are seldom fatal. A person taking transfer of the property under circumstances like these is not permitted to insist on the apparently absolute character of the title acquired so as to defeat the interests or expectations of another on whose joint behalf the agreed purchase was made. "To make use of the Statute to smother such an agreement is itself a fraud". See Organ v. Sandwell [1921] VLR 622, 630, which was a case in which the executor of a deceased wife was held to be trustee for her husband of land she had acquired in her own name under an agreement with him that she should hold for them both as joint tenants. The case, it is true, is one in which the report suggests that the "trust" may have been express; but the use of that word is not vital to the application of the principle. The same result will ordinarily follow whenever it is shown that a sufficiently defined beneficial interest was intended to result to each. See Bannister v. Bannister [1948] 2 All E.R. 133.

Applying that doctrine to the 1949 arrangement, the plaintiff might perhaps have hoped to show that he acquired a beneficial interest as tenant in common in the six properties as and when Mrs Marks acquired each of them in her own name between 1952 and 1965. Matters did not, however, stop there. On about 7 August 1972 a further relevant conversation took place. The most complete account of it is in a passage in the plaintiff's evidence that was selected by the trial judge in his reasons as the account he accepted. It is as follows:

"Will you tell us what was said in this conversation? -- Yes. I said, 'It's a long time since 1949' - 'since I promised to come and live with you and help you out. You had two properties' - 'you had one property then and you said then that that had to be for your two boys.

You have said so many times that you will - my future was secure, that I would never want'. I told her then that she was the biggest land owner in the Atherton Shire at that particular time, and that she had said - she said then at that particular time if we were able to acquire other land she would share them with me.

Yes? -- She said, 'Yes. I can thank you for that.
You insisted that I purchase these properties. I
intend to leave you Walmsley's, Cozens and
Pavey's. Pavey's has a small house. We discussed
this when we visited them first, when we inspected
the house. She said, 'You'll need cattle. I'll
leave you - how many cattle have we?' I said,
'About 600'. She said, 'I'll give you 250 head of
cattle. I intend to leave Font Hill and Newell
Swamp to my grandson Malcolm. You and Malcolm

have been fairly close. I hope you can work

together'."
Is that it? -- That's it, yeah."
Although put forward as a mere "refinement" of the 1949

arrangement in that it specifically identified the plaintiff's "share", the effect of what Mrs Marks said on this occasion in 1972 was so at variance with what had previously been agreed between her and the plaintiff as to amount only to a repudiation of it by her. Under the 1949 arrangement he was to receive successively, as and when she acquired further properties, an immediate beneficial interest in a moiety of each. In contrast, under the 1972 arrangement, as it is convenient to describe it, he would acquire nothing at all until Mrs Marks died, when he would inherit under dispositions made in her will, not half shares in all six properties, but the full interest in only three that were nominated unilaterally by her out of those six.

What would happen if he predeceased her was not catered for by the 1972 arrangement, which tends to confirm the impression that his rights in the specified properties were not to arise at once but only upon her death. The inclusion for the first time of 250 head of cattle was another departure representing as it did an addition to the benefits envisaged in the original arrangement of 1949.

Because the 1972 arrangement contemplated that the plaintiff's rights would arise only under the will of Mrs Marks at her death, it cannot have vested in him an immediate beneficial interest in any of the three properties. The learned trial judge considered that what Mrs Marks had said in 1972 should be viewed not (as the plaintiff contended) as a declaration or an agreement for a trust, but as a testamentary promise; that is, as an undertaking on her part that she would by her will leave the nominated properties to the plaintiff. His Honour stressed that what Mrs Marks had said was: "I intend to leave you certain portions of property ...". He added that the plaintiff understood it in that way; in cross-examination he agreed that he would receive nothing if Mrs Marks died without making a will. That, too, is inconsistent with his acquiring (or even retaining) an immediate beneficial interest in any of the properties.

There are of course grounds for thinking that what Mrs Marks said amounted to something even less substantial than a testamentary promise, and was no more than a statement of her future intention that had no contractual significance or effect at all. Common experience is that statements about possible future testamentary dispositions are not unusual, which may be why courts (and society as a whole) tend to discount them : see, for example, Re Fickus [1900] 1 Ch.331.

That would be a short answer to a claim by the plaintiff based on the 1972 arrangement; but even if her statement is treated as a firm offer or promise other difficulties remain. To be enforceable the promise had to be accepted and supported by consideration. Acceptance and consideration might be constituted by an act or series of acts on the part of the promisee, as in the well known Smoke Ball case. But for this requirement to be satisfied, it was and is necessary that the act or acts should have been done by the plaintiff as promisee acting in reliance on the promise from Mrs Marks and in exchange for it. In cases like this reliance may also be a necessary element in the process of acceptance (cf. The Crown v. Clarke (1927) 40 C.L.R. 227, 231) but its principal relevance is to consideration. As was said in Australian Woollen Mills v. The Commonwealth (1954) 92 C.L.R. 424, 427, "Between the statement and announcement, which is put forward as an offer capable of acceptance by the doing of an act, and the act which is put forward as the executed consideration for the alleged promise, there must subsist, so to speak, the relation of a quid pro quo".

The acts put forward as constituting both the acceptance and the consideration moving from the plaintiff in return for Mrs Mark's promise can be gathered from para.6 of the amended statement of claim, where the 1972 promise is pleaded; it goes on to say that:

"As hereinbefore set forth, the plaintiff continued from and after 7 August 1972, to manage, work, and supervise the said property and to care for the deceased up to her death".

What is asserted there is clarified in para.7, where the allegation is:

"In the premises, the plaintiff says there was an agreement and part performance thereof by the plaintiff, or alternatively that there was a common intention that the said lands ... were the object of a trust."

Other parts of the allegations in para. 7 that have not been set out above make it plain that, as was emphasised on appeal, the plaintiff's case both at trial and before this Court is and always has been that his claim to the three specified properties, or for equitable damages in lieu of them, arises out of a combination of both the 1949 arrangement and the 1972 arrangement, and not from either one of them considered in isolation from the other. This leads directly to the difficulty, already mentioned, of reconciling the two arrangements.

The difficulty cannot be avoided by approaching the
1972 arrangement as giving rise to a distinct set of rights.
For if, as paras. 6 and 7 allege and the evidence shows,
the plaintiff after the 1972 promise by Mrs Marks continued
to manage, work and supervise the properties and to care for
her, there is nothing in what Mrs Marks said on that
occasion to suggest that she stipulated for his doing so as
the consideration for her testamentary promise. On the

contrary, her 1972 statement shows that she considered she

was bestowing a gift on him as a reward for past services.
Even if one were justified in assuming or inferring an
unspoken request on her part for acts to be done, there is
nothing at all in the plaintiff's own evidence to suggest
that his subsequent actions in managing the properties,
etc., were in fact carried out in reliance on the promise
she made to him in 1972. In the absence of direct evidence,
it is often possible to infer the necessary reliance from
subsequent acts corresponding to the consideration
stipulated for in the offer. Those acts are then readily
referable to the antecedent promise. Here, however, no such
inference from the circumstances is available because the
acts of management, etc., done by the plaintiff after 1972
are equally referable to the earlier arrangement of 1949, or
even to no arrangement at all, as they are to the promise
made by Mrs Marks in 1972. Considered objectively, there
was nothing the plaintiff did after the promise in 1972 that
differed from what he was doing before it; nor was there any
affirmative evidence that what he did after 1972 was done in
response to or in reliance on that promise. For the same
reason, the plaintiff's testimony provides no firm evidence
of any reliance on the 1972 arrangement sufficient to found
an estoppel in his favour.

Indeed, it always was fundamental to the plaintiff's case, to the way it was pleaded and conducted at trial, and to the submissions on appeal, that the whole of what was done by the plaintiff between 1949 and the death of Mrs Marks in January 1980 was a single continuum proceeding not simply from the 1972 arrangement or the 1949 arrangement, but from a combination of them both. Neither at trial nor on appeal, has the plaintiff contended that it was possible to approach either of the two arrangements in isolation, so as to show that rights were created or arose in his favour in consequence of actions done in reliance upon one arrangement rather than the other. On the contrary, he has consistently asserted that it was only by taking the 1949 and 1972 arrangements in combination, together with the acts done by him in reliance upon both, that he acquired his rights to the three properties nominated by Mrs Marks in her promise in 1972. It is not possible now to view the matter in another way; for example, by treating the 1972 promise as a unilateral and thus ineffective repudiation by Mrs Marks that left the plaintiff's rights under the 1949 agreement intact and enforceable. On appeal we were not invited to adopt any such approach.

There may have been sound practical reasons why the plaintiff did not seek to rely on the 1949 arrangement alone or on any beneficial rights in property that it may have generated. In the first place, if he acquired any such rights, he did nothing to assert or enforce them at all until after the death of Mrs Marks in 1980. In the 30 or more years that elapsed after 1949, new rights appear to have been created in those properties, some of them in favour of persons who purchased for value apparently in good faith and without notice of any right in the plaintiff. On the advice of her solicitor, deeds were executed in 1976 transferring the properties, or some of them, to an incorporated family trustee (which is the second defendant), which then issued units to the first defendant, who is a son and the executor of Mrs Marks. If, as is asserted, he had no notice of the plaintiff's interest, it would be difficult now for it to be enforced against him. Quite apart from that, very different decisions might have been taken and different investments made, both by Mrs Marks and later on by the two defendants, if the plaintiff had asserted his right under the 1949 arrangement in proper time. It is true that what he now claims, as an alternative to the land itself or a beneficial interest in it, is damages by way of equitable compensation for its having been disposed of in disregard of his interest in it; but in order to succeed in the claim for damages, he must first make good his right to the land itself or the interest in it. Equitable considerations of laches and acquiescence are relevant, and they may well have been viewed by the plaintiff's advisers as a serious threat to the claim. They are capable of including factors like the fall in the purchasing power of money, and progressive increases in land values taking place over the very long period since the land began to be acquired in 1952 : cf Barburin v. Barburin (No. 2) [1991] 2 Qd.R. 240, where the authorities are reviewed.

In the action questions like this are raised in paras. 3 to 17 of the amended defence, where it is also alleged that, in the course of the long delay since 1981 in bringing the action to trial, various witnesses, including the accountant and the solicitor to Mrs Marks, have died.

The consequence, so it is said, has been the source of further prejudice to the proper conduct of the defence. The trial judge was asked to decide these matters, but for some reason he did not do so. They still await determination, which means that their outcome cannot be predicted. In retrospect, however, the time for decisive action on the part of the plaintiff would have been in 1972, when Mrs Marks repudiated the 1949 arrangement by her unilateral declaration placing their relations on another footing.

Instead of protesting at that time, the plaintiff acquiesced in what she then announced, thus leaving an impression that he was no longer claiming the beneficial interest in the six properties affected by that arrangement. By failing to protest against her new proposal in 1972, he must be seen as tacitly abandoning whatever rights he had under the 1949 arrangement.

A further argument addressed to us was that even if it was not possible to find for the plaintiff on the basis of a trust arising from the common intention of the parties, it would, having regard to the respective contributions of the parties, be unconscionable now to allow the defendants to retain all the properties without compensating the plaintiff. To give effect to his claim it was argued that a constructive trust should be imposed. The decisions in Muschinski v. Dodds (1985) 160 C.L.R. 583, 620; Baumgartner v. Baumgartner (1987) 164 C.L.R. 137, 148; and Bryson v. Bryant (1992) 29 N.S.W.L.R. 188, were relied on as authority, although many other decisions were also cited in which the principle of those cases has been considered. It was accepted that the trial judge had correctly stated the principle in holding that such a constructive trust could be imposed only if the position would otherwise be unconscionable but it was submitted that he was wrong in declining to apply it in the circumstances disclosed by the evidence in the case.

The substance of what his Honour said on this subject was that the plaintiff had worked industriously on the properties for many years, and had identified properties for subsequent acquisition by her; but that the evidence did not reasonably permit the conclusion that he had not been adequately compensated for his contribution in that behalf.

His Honour referred to the fact that Mrs Marks had provided the plaintiff with money as required by him from time to time; as well as with clothes, food, accommodation, and the use of a car. His relationship to Mrs Marks and her properties gave him access to positions in the community as well as a status which his Honour thought was important to the plaintiff.

We were taken through the evidence about what the plaintiff had done and what he had received in the course of the 30 or more years during which he lived with Mrs Marks. It seems correct to say that the amount of money he received, or the amounts he banked in his own account, are less, perhaps even much less, than the wage he might have expected from an employer for doing similar work at prevailing rates during the years in question. The matter has, however, to be considered in conjunction with the other non-pecuniary benefits mentioned, and also with the fact that he retained some of the proceeds of sales of maize and cattle produced on the properties.

The question is essentially one of fact and, in the end, partly of impression. Although it is possible to conclude that the plaintiff was undercompensated for his efforts, the evidence does not show that his Honour was mistaken in his findings on these matters; nor does it demonstrate such a lack of proportion between what he did and what he received for it as to require the imposition of equitable relief in this form.

Even if disproportion of that kind were shown to exist, the present case would in my opinion not attract the imposition of a constructive trust according to the principles explained in the decisions referred to. It is settled now that a constructive trust is "a remedial institution which equity imposes regardless of actual or presumed agreement or intention ... to preclude the retention or assertion of beneficial ownership ... contrary to equitable principle" Muschinski v. Dodds (1985) 160 C.L.R. 583, 614, per Deane J.; or, as was said by Mason C.J., Wilson and Deane JJ. in Baumgartner v. Baumgartner (1987) 164 C.L.R. 137, 147, the foundation for imposing such a trust:

"is that a refusal to recognise the existence of the equitable interest amounts to unconscionable conduct and that the trust is imposed as a remedy to circumvent that unconscionable conduct."

While acknowledging that notions of justice and fairness are relevant to the whole concept of constructive trust, those decisions are also careful to deny that impressions of that kind (at least if they are "idiosyncratic") are the sole criteria. See Baumgartner v. Baumgartner, at 148, adopting a passage from Muschinski v. Dodds, at 615, where Dean J. said a remedial constructive trust was available only when warranted by "established equitable principles", or by legitimate processes of reasoning from them; see also Bryson v. Bryant 29 N.S.W.L.R. 188, 196, 219.

It would, I think, not have been difficult to identify principles within which the present case might have been brought in the early stages of the relationship between the plaintiff and Mrs Marks. What came into existence under the 1949 arrangement was a joint venture akin to a partnership between them in terms of which they would work together and share, although admittedly in unspecified proportions, in subsequent increases in her acquisition of land. Having regard to the relationship of mutual trust and co-operation which such an operation required, their common activity could readily have been viewed as analogous to a partnership, or to a joint adventure over which equity has traditionally asserted jurisdiction, as in United Dominions Corporation Ltd. v. Brian Proprietary Ltd. (1984) 157 C.L.R. 1, or the much earlier case of Russell v. Austwick (1826) 1 Sim. 52; 57 E.R. 498, as well as in case of Baumgartner v. Baumgartner itself.

The problem for the plaintiff remains, however, that on the impression I have formed of the matter and the basis on which the claim has throughout been pursued in court, such an approach to the question ceased to be available once the plaintiff accepted or acquiesced in the termination of the original 1949 arrangement and its replacement by the new arrangement of 1972. On no view of it can the later arrangement be considered as giving rise to anything resembling a partnership, quasi-partnership or joint venture between the plaintiff and Mrs Marks. At best it amounted to no more than a promise to leave property by will. Other difficulties apart, there is no equity to assist a volunteer in enforcing a promise like that, and no other equitable principle capable of being adopted or adapted to compensate the plaintiff for his disappointed expectations. His claim to the three properties Walmsley's, Cozens, and Pavey's or to compensation in lieu of them rests ultimately on the unfulfilled promise made by Mrs Marks in 1972.

Not much can be added to what has already been said on this subject. Outside the limits prescribed by testator's family maintenance legislation, there is no general jurisdiction in courts to reward merit by revising dispositions of deceased estates. The concept of unjust enrichment cannot be called in aid to assist the plaintiff in this case. It is true that Mrs Marks may have been guilty of exploiting both the plaintiff's labour and his fidelity to her, and it is plain that his efforts over the years contributed substantially to the value of her estate at death. That is, I am persuaded, nevertheless not enough now to give rise to a claim against her or her personal representatives founded either at law or in equity on conceptions of unjust enrichment. Many intimate human relationships are in some measure exploitive, sometimes mutually so, and often in ways having results financially beneficial to only one of the parties. Experience shows how difficult it is to value the respective contributions of capital, labour and enterprise to the products of their combined efforts.

Any quantum meruit to which the plaintiff might claim through being undercompensated for his work and skill would need to be related in amount not primarily to the land he was promised or its value at or before the death of Mrs Marks, but to the services he provided and the reasonable cost of obtaining them on the open market. It is, it has been held, only where the type of employment is one for which there is no usual rate of payment that the court takes into account "the bargainings between the parties"; even then it does so "not with a view to completing any special contracts which they may have intended to make, but as evidence of the value which the parties set upon their services" : see Stinecombe v. Thomas [1957] V.R. 509, 513, per Monaham J. A similar modest measure is applied by equity in compensating a co-owner for improving the common property, where the criterion adopted is not the enhancement in the value of the property improved but only the reasonable market cost of the improvement : McMahon v. Public Curator of Queensland [1952] St.R.Qd. 197. The fact that the plaintiff helped to improve or enlarge the property of Mrs Marks gives him no beneficial title to or interest in her estate or to assets forming part of it.

For all these reasons it seems to me that, consistently with established principle, it is not open to this Court to hold that the plaintiff is entitled to the three named parcels of land he was promised in 1972. It follows that he cannot be compensated in equity for the disappointment of his expectation of succeeding to that land.

The appeal should in my opinion be dismissed with

costs.
THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 115 of 1993

Brisbane
[Willets v. Marks & Skram Investments P/L]

BETWEEN

ERIC GORDON WILLETS

(Plaintiff) Appellant

AND

THOMAS HENRY MARKS and
SKRAM INVESTMENTS PTY LTD

(Defendants) Respondents

The President
Mr Justice McPherson

Mr Justice Davies

Judgment delivered on 14.2.1994

Separate reasons by each member of the Court. Fitzgerald P. and Davies J.A. agreeing as to the Order. McPherson J.A. dissenting.

APPEAL ALLOWED WITH COSTS TO BE TAXED. SET ASIDE JUDGMENT DISMISSING APPELLANT'S ACTION AND ORDER FOR COSTS MADE BELOW. ACTION REFERRED BACK TO TRIAL DIVISION FOR DETERMINATION OF OUTSTANDING ISSUES. COSTS OF PROCEEDINGS TO DATE, OTHER THAN OF THE PRESENT APPEAL, RESERVED TO TRIAL JUDGE HEARING REMITTED ISSUES.

CATCHWORDS	EQUITY - CONSTRUCTIVE TRUST - Unconscionable Conduct - Breach of Promise - Defacto Relationship - Promise of immediate beneficial interest in properties subsequently acquired - Unilateral alteration of promise by woman - Whether testamentary promise - Whether man acquiesced to new arrangement.
CONTRACT - Whether consideration and acceptance
Counsel:	C. Wall Q.C., with him M. Drew, for the appellant
R. Chesterman Q.C., with him R. Pack, for the respondent

Solicitors: Bowen Lagois, t/a Baker Johnson, for the

appellant

Connolly Suthers for the respondent

Hearing Date: 20 October 1993

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND	Appeal No. 115 of 1993
Brisbane
Before	The President Mr Justice McPherson Mr Justice Davies

[Willets v. Marks & anor.]

BETWEEN:

ERIC GORDON WILLETS

(Plaintiff) Appellant

AND:

THOMAS HENRY MARKS and

SKRAM INVESTMENTS PTY LTD

(Defendants) Respondents

REASONS FOR JUDGMENT - DAVIES J.A.

Judgment delivered 14/02/1994

I have had the advantage of reading in draft the judgments of the President and McPherson J.A. In both the facts of the case are stated in some detail. I shall therefore confine my reference to the facts to those essential to the conclusion which I reach.

In 1949 the appellant left his employment in Brisbane to go to live with Pansy Esther Marks ("the deceased") upon her farm near Atherton. He was separated from his wife and she was a widow. They intended to and did live as man and wife.

Their relationship had blossomed whilst he was still living and working in Brisbane. It was during this period that the deceased had asked him to come and live with her and to manage her farm. He had previously been a farmer. She promised that, if he did, she would share with him any increase in her properties, that is any properties which she acquired additional to the farm which she then owned. It was in reliance on that promise, as well no doubt because of the affection he felt for her, that the appellant accepted her offer.

From then until the deceased's death in 1980 the appellant managed and worked on the farm, advised her on the purchase of other properties and managed and worked on other properties after she acquired them. In the words of the learned trial judge:

"He went on to make a great contribution to the building up of Mrs Marks' estate, both in the profitable running and development of the farm, and in her acquisition of the further properties, financed at least in part through profits generated by that farming operation."

For that contribution he received no wages but, in addition to his accommodation and food, other things such as clothes, the use of her car and occasionally money, all consistent with his being merely her dependant spouse.

From the time of the conversations between the appellant and the deceased in 1949, the appellant had a reasonable expectation, and indeed it was (at least until the 1972 conversation) the common assumption between him and the deceased that the appellant would share in any increase in the deceased's land holdings after he came to live with her in 1949. By 1972 the deceased had acquired a further six properties due, at least in part as the deceased acknowledged, to the efforts of the appellant.

Looked at in isolation, the promise given in 1949 which gave rise to that expectation and assumption might be construed as a promise to share equally any property subsequently acquired. However, from the 1972 conversation, to which I shall shortly refer it may be inferred that in 1949 neither the appellant nor the deceased had thought out how the sharing would take place and their domestic arrangements during the intervening period apparently rendered it unnecessary for them to turn their minds to that question.

What prompted the appellant to raise the topic again in 1972 is not explained. Perhaps it was their advancing age. The terms of the 1972 conversation indicate that the appellant and the deceased directed their attention to the death of the deceased, envisaging that she would predecease the appellant as, of course, she did.

The appellant's version of the 1972 conversation, which occupied only 20 or so lines of the transcript and is set out in both of the other judgments in this appeal, was accepted by the learned trial judge. What was actually said on that occasion may well have been far more extensive than this apparently summarised version recalled 20 years later.

But plainly they spoke of what was said and done in 1949, what had happened since, the need to secure the appellant's future and the division of the properties acquired by the deceased since 1949 so that the appellant would obtain three of the six so acquired. From this evidence I would infer that it was then, for the first time, that the appellant and the deceased turned their minds to how the sharing, to which they had referred in 1949, would take place. Nothing which was said on this occasion indicates that either thought that they were departing from the arrangement which they had made in 1949.

It is true that what the deceased said in 1972 amounted to a testamentary promise whatever her or their joint intention was at that time. It is also correct, in my opinion, that that promise was unenforceable as a contract for the reasons stated by the President. But the appellant, both below and in this court, sought to rely, amongst other things, upon a constructive trust. In considering this remedy, it is important to remember that these were two lay people discussing the way in which the appellant would be secured for what he had done in accordance with the earlier mutual promises. Bearing also in mind that whilst they remained together the appellant's needs appeared to be modest, it is not surprising that the reference was made by the deceased to leaving the properties to him in her will rather than to the making of an immediate legal disposition of them. It may also be inferred from the fact that the deceased had, up to then, retained financial control of the properties, that she wished to continue to do so during her lifetime.

In summary, this is a case in which, in 1949, the appellant and the deceased agreed to live together in a de facto relationship and to pool their resources, the deceased's existing assets and her business acumen and the appellant's skill and knowledge of farming, in order to build up the deceased's land holdings on the basis that the increase therein would be shared between them in a way which they did not specify and to which they probably did not advert. They thereafter conducted their lives together on that basis and, in consequence, a number of further properties were acquired; although it must have been understood between them that, whilst they remained together, all of those properties would remain in the legal ownership of and be controlled by the deceased. No doubt having regard to the appellant's need for future security rather than immediate ownership and the deceased's apparent desire to retain control, in 1972 they agreed upon the basis upon which that sharing would take place.

In 1976 the deceased departed from that arrangement by vesting all of her property in the trustee of a unit trust (the second respondent) and, though for a time she retained all of the units in that trust, by making a will, which was as it happened her last, in which she left nothing to the appellant. This departure from that arrangement by the deceased in 1976 was unconscionable and consequently attracted the imposition of a constructive trust at the suit of the appellant: see Muschinski v. Dodds (1985) 160 C.L.R. 583; Baumgartner v. Baumgartner (1987) 164 C.L.R. 137. That unconscionability arose from the arrangement made in 1949, the work done by the appellant since that date and the consequent acquisition by the deceased of further properties, the receipt by the appellant since that date of no more than a dependant spouse would ordinarily receive from a reasonably generous provider spouse, and the 1972 promise. That trust was in respect of each of those named properties, Walmsley's, Cozens' and Pavey's.

It may be that the trust in respect of one or more of those properties was converted by act of the deceased or her successor in title into a claim for monetary compensation;

it seems that all properties have passed to bona fide purchasers for consideration. But that question and those raised by paragraphs 12, 14, 15 and possibly 17 of the Amended Defence must await determination by a trial court.

For those reasons I agree with the conclusion reached by the President contained in the summary at the end of his Honour's reasons.