Yeo and Rambaldi v Arifovic and Anor

In the matter of *Yeo and Rambaldi v Arifovic and Anor*, heard in the Federal Court of Australia, the dispute concerned an application by the trustees in bankruptcy for the sale of real property registered solely in the name of the bankrupt. The property was acquired during a de facto relationship between the bankrupt and the second respondent. Following the purchase of the property, the parties pooled their funds and applied them towards joint living expenses.

The court was required to determine whether the second respondent held an equitable interest in the property, notwithstanding its sole registration in the bankrupt's name. Specifically, the court considered whether a resulting trust or a constructive trust, of the kind recognised in *Muschinski v Dodds* and *Baumgartner v Baumgartner*, could be established based on the contributions made by the second respondent.

After examining the complex banking arrangements between the bankrupt and the second respondent, and considering both monetary and non-financial contributions, the court found no evidence to support the existence of a resulting trust or a constructive trust based on common intention. However, the court determined that the evidence did support an equitable interest in favour of the second respondent to the extent of 32.52% of the net proceeds of sale of the property, based on the principles applicable to a *Muschinski v Dodds* / *Baumgartner v Baumgartner* type constructive trust. The remaining balance of the net proceeds was to be paid to the trustees in bankruptcy. The issue of costs was reserved.