Woods v McKinlay (No 4)

The case of Woods v McKinlay (No 4) was heard by the Supreme Court of New South Wales. The plaintiffs, Woods, were in a long-term de facto relationship with the defendant, McKinlay, and together they owned a property. The dispute centred around the division of proceeds from the sale of this property, specifically the portion withheld to account for potential tax liabilities. The court was required to determine whether a constructive trust should be imposed on the withheld amount and, if so, how it should be divided between the parties.

The primary legal issue was whether the court should impose a constructive trust over the withheld amount from the sale of the property. The Woods argued that since the property was acquired during their de facto relationship and sold upon its dissolution, a constructive trust should be imposed to reflect their respective contributions to the property. The McKinlay, on the other hand, contended that no such trust should be imposed and that the proceeds should be divided equally. Another issue was the costs associated with the cross-claim, where the amendment to the statement of claim was said to render the cross-claim unnecessary.

The court found that a constructive trust should indeed be imposed over the withheld amount. It held that the Woods' contributions to the property, both financial and non-financial, warranted a division that reflected their respective inputs. The court also determined that the amendment to the statement of claim did render the cross-claim unnecessary, and thus, the costs of the cross-claim should lie with the party who pursued it. The withheld amount was divided between the parties in a proportion that the court found just and equitable, taking into account their respective contributions.

In summary, the court imposed a constructive trust over the withheld amount from the sale proceeds and divided it between the parties based on their contributions. It also ruled that the costs of the cross-claim should lie with the party who pursued it, following the amendment to the statement of claim.