Zaffina v Zaffina

[2000] NSWSC 343

CITATION:	Zaffina & Anor v Zaffina & Anor [2000] NSWSC 343
CURRENT JURISDICTION:	Supreme Court
FILE NUMBER(S):	SC 4602/98
HEARING DATE(S):	4-7 April 2000
JUDGMENT DATE:	20 April 2000
PARTIES :	Rosa Zaffina & Anor v Domenico David Zaffina & Anor
JUDGMENT OF:	Hodgson CJinEq at 1

COUNSEL :	P - Mr M Cashion SC & Mr D Priestley D - Mr S Gregory & Mr N Newton
SOLICITORS:	P - Dwyer Mahon & Robertson D - Irwin & Richards
CATCHWORDS:	Contract - Rectification or trust - Need for clear evidence of intention and mistake - Estoppel - Need for clear evidence of belief and reliance
DECISION:	See par 76 of judgment

6

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

CORAM: HODGSON CJ in Eq

Thursday, 20 April 2000

No 4602/98: R OSA ZAFFINA & ANOR v DOMENICO DAVID ZAFFINA & ANOR
JUDGMENT

1   HIS HONOUR: The first plaintiff Rosa Zaffina is the registered proprietor of Lot 88 in deposited plan 570228, comprising about 20 acres at Euston in New South Wales. The first defendant Domenico Zaffina is the registered proprietor of Lot 87 in the same deposited plan, comprising about 23 acres and adjoining Lot 88. Lot 87 has a frontage to Kilpatrick Road. Lot 88 is a battleaxe block, the body of which lies behind Lot 87, and the panhandle of which is a strip about 20 metres wide and a little under 300 metres long, running to Kilpatrick Road along the western boundary of Lot 87. Both Lots are used to cultivate grapevines. Some vines are planted on the panhandle, and these are cultivated and harvested by the first defendant in conjunction with vines on Lot 87.
2   By the summons in these proceedings, the first plaintiff and her son Louie Zaffina seek orders which would have the effect of giving them possession of the panhandle to the exclusion of the first defendant, and also seek damages.

3   By their cross-claims, the first defendant and his parents Luigi and Lina Zaffina seek orders which would have the effect of recognising a trust of the panhandle in favour of one or more of them, or alternatively a profit a prendre entitling them to cultivate the vines, or alternatively compensation the basis of estoppel.

OUTLINE OF FACTS

4   I will commence with an outline of facts which are either undisputed or clearly proved. I will use the forenames of members of the Zaffina family.

5   Prior to arrangements made in 1971, three Zaffina brothers, Luigi, Domenico and Pasquale, and their respective wives, Lina, Felicia and Rosa, were in a partnership cultivating grapes on two blocks of land at Euston which I will identify as Lot 28 and Lot 39. 6   Lot 28 comprised about 21 acres, and Luigi, Domenico and Pasquale were the registered proprietors of that Lot. Lot 39 comprised about 43 acres, and the registered proprietors of that Lot were Luigi and Lina, Domenico and Felicia, and Pasquale. It is this Lot which was subsequently subdivided into Lots 87 and 88. 7   There were three dwellings on Lot 39, in which the three families lived. There were two houses on what subsequently became Lot 87, that is the Lot with street frontage: Domenico and Felicia lived in the house near to the street frontage, and Luigi and Lina (together with their sons Domenico, the first defendant, and Francesco) lived in the house in about the middle of Lot 39, towards the rear of what became Lot 87. There was one house on the part of Lot 39 which became Lot 88, and Pasquale and Rosa (together with their son Louie, the second defendant) lived in that house. 8   During 1971, the three brothers agreed to partition the properties, by dividing Lot 39 into two roughly equal blocks, with each family taking one of the three Lots which would be held following that subdivision. It was agreed that Pasquale and Rosa would take the rear block created from Lot 39, and that Luigi and his brother Domenico would draw lots to decide who was to take Lot 28 and who was to take the front block created from Lot 39. In fact, it was determined that Luigi and his family would take the front block created from Lot 39, and Domenico and his family would take Lot 28. 9   It was, initially at least, contemplated that access to the rear block created from Lot 39 would be provided by an easement over the front block created from Lot 39. 10   The family's solicitor Ross Blair was retained to give effect to this agreement; and he arranged for a surveyor Don Pedler to draw up plans. 11   There is in evidence a letter dated 22 June 1971 from a valuer Arthur Spiller giving a value for Lot 39 of $22,875 and a value for Lot 28 of $15,625. 12   By about September 1971, Mr Pedler had prepared a plan of subdivision of Lot 39, which did not provide for an easement as originally contemplated, but provided for a 20 metre street frontage for the rear block and a 20 metre wide panhandle included in the rear block and giving access to it. Originally the two Lots were identified as 39A and 39B: Lot 39A, of about 23 acres, later became Lot 87; and Lot 39B, of approximately 20 acres, later became Lot 88. 13   There is in evidence, apparently from Mr Blair's file, an original letter dated 24 September 1971 from Mr Pedler, addressed to the registered proprietors of Lot 39, advising that the subdivision had been completed, and that the plan had been submitted to Balranald Shire Council for approval. 14   There is also in evidence a letter dated 30 November 1971 from Mr Spiller to Mr Blair, giving a value for Lot 39A of $13,425 and a value for Lot 39B of $9450. Included in the figures making up the value for Lot 39A was an amount of $1725, representing land of 23 acres at $75 per acre; and $6300, representing plantings of 18 acres of vines at $350 per acre. The remainder of the value was made up of amounts representing two cottages built on Lot 39A. Included in the value for Lot 39B was an amount of $1500, representing land of 20 acres at $75 an acre; and $5200, representing plantings of 14 acres of vines at $350 an acre and three acres of young vines at $100 per acre. The remainder of the value was made up by a figure for a cottage on that Lot. 15   There was also in evidence a deed for partition dated 23 December 1971, to the effect that Domenico and Felicia were to have Lot 28, Luigi and Lina were to have Lot 39A, and Pasquale was to have Lot 39B. To achieve substantial equality, it was provided that Domenico and Felicia were to pay a sum of $2000 owing on Lot 29, and a further sum of $1450 to Pasquale; and that Luigi and Lina were to pay a sum of $1258 to Pasquale. It is plain that those figures are based on the values provided by Mr Spiller. The deed was executed by each of those five persons and witnessed by Mr Blair. 16   In 1971, the grapes on Lot 39 were grouped in a number of areas, some with rows running north-south and some with rows running east-west. Around the edges of these areas there was a gap generally of the order of about five metres wide, used by tractors for access to the vines and for turning: these gaps are called "headlands". The eastern half (or thereabouts) of the southern boundary of Lot 87 followed one of these headlands. The western half of that southern boundary was crossed by rows of vines within one of the planted areas, running north-south. In 1974, vines were removed from the vicinity of the western half of the southern boundary of Lot 87, so that there was thereafter a headland continuing all the way along this southern boundary and extending to the end of the plantings. 17   In 1976, Luigi replaced rows of vines running north-south in the area in the southwest corner of Lot 87, which extended about 10 metres into the panhandle of Lot 88, by east-west rows of vines covering substantially the same area. 18   There was some delay in registration of the plan of subdivision, partly due to a requirement to renumber the Lots from 37A and 37B to 87 and 88. The plan of subdivision was in fact registered on 30 October 1974, following which new titles issued for Lot 87 and Lot 88. Lot 87 was transferred by the five persons who had owned Lot 39 to Luigi and Lina by a transfer registered on 13 December 1983. However, there was no transfer by those five persons of Lot 88 until after the death of Pasquale, which occurred on 2 July 1990. Lot 88 was in fact transferred to Pasquale's widow Rosa by a transfer registered on 26 July 1994. 19   In 1979, Domenico and Felicia left the partnership previously conducted by the three couples, and thereafter Luigi and Lina, and Pasquale and Rosa, continued in partnership for a further 10 or 11 years. 20   In 1987, Louie entered into a license arrangement with his parents Pasquale and Rosa, and since that time he has managed Lot 88. 21   As from 1 July 1991, the partnership between Luigi and Lina on the one hand, and Rosa on the other, was dissolved. Thereafter, the families conducted separate businesses. 22   It is common ground that, at least by this time, the panhandle of Lot 88 had three strips. Starting from the western boundary, there was a gravel roadway giving access to Rosa's house on Lot 88, about five metres wide. Next, there was a strip of dirt or headland a little under five metres wide, used by tractors working the vines which extended from Lot 87. Thirdly, there was a strip mainly occupied by those vines, about 10 metres wide, those vines being cultivated and harvested by Luigi's family in conjunction with the vines they had growing on Lot 87. 23   In about 1994, Luigi's sons installed an irrigation system serving the Lot 87 vines, including those in the panhandle of Lot 88. The total cost of this installation was of the order of $50,000. 24   On 14 December 1995, Luigi and Lina transferred Lot 87 to their son Domenico. 25   On 29 October 1997, Louie contacted the family solicitor Chris Gallagher, complaining that farm vehicles from Lot 87 were using the gravel road on the panhandle to turn, and were damaging the road. Mr Gallagher opened a file entitled "Re Easement Rosa Zaffina". He wrote a letter dated 3 November 1997b to the Luigi family's company, headed "Easement - Rosa Zaffina" and continuing as follows:

We have been consulted by Rosa Zaffina with respect to some queries relating to an easement running across your property and in favour of Rosa Zaffina.. We wonder whether you could make an early appointment with the writer in order to discuss this matter.

26   That letter did not lead to any useful communications, and on 23 January 1998, the solicitors who act for the plaintiffs in these proceedings wrote to Domenico and Luigi asserting Rosa's ownership of the panhandle, and requiring Domenico and Luigi to remove their vines after the current season, and not to use the roadway for turning.
27   In October 1998, Louie attempted to erect a fence dividing the roadway on the panhandle from the headland: this was removed by members of Luigi's family. 28   These proceedings were commenced on 10 November 1998.

ISSUES

29   The defendants claim that the true agreement in 1971 was that Lot 39 was to be subdivided by a line following the existing southern boundary of Lot 87, but continuing all the way to the western boundary of Lot 39; and that access to the rear block was to be by easement only across the front block, along its western boundary. The defendants claim that the actual subdivision, the partition deed and the transfers of title were not in accordance with this agreement; and that although there would be problems with giving the remedy of rectification, the Court could provide appropriate equitable relief by declaring a trust. 30   The defendants also claim that, in the belief that their Lot 87 included the panhandle of Lot 88, they expended money and did other acts on the faith of this belief, particularly the changing of the direction of the vine rows in 1976 and the expenditure of $50,000 in about 1994; that this was known to the plaintiffs; and that the work and expenditure were encouraged by the plaintiffs inter alia by the plaintiffs refraining from asserting their legal rights. This gave rise to an estoppel which could be given effect to either by profit a prendre or by compensation. 31   If the defendants fail on both these claims, it is common ground that the plaintiffs are entitled to possession; but there is an issue as to whether the plaintiffs are entitled to damages, and if so in what sum. 32   I will approach the matter by first considering factual disputes (including questions of credit); then considering whether a case is made out for rectification or relief by way of trust; then considering whether the cross-claimants have the benefits of an estoppel; and finally considering the question of damages.

FACTUAL DISPUTES

33   The central factual questions in this case concern the question of what happened in 1971 in relation to the subdivision of Lot 39. Luigi has given evidence concerning the circumstances that existed in 1971, of conversations which took place, and of his understanding and intention at the time. Both of his brothers, Domenico and Pasquale, are now deceased. The wives Lina and Rosa have not been able to give any useful evidence concerning the conversations at the time. The solicitor Mr Blair has given evidence concerning the circumstances, which conflicts substantially with that of Luigi. 34   Luigi's evidence was to the effect that it was agreed by the three brothers, and their wives, that Lot 39 would be divided by a line following the existing southern boundary of Lot 87 but continuing all the way to the western boundary of Lot 39; that access to the rear Lot would be provided by an easement over a road existing along the western edge of the front part of Lot 39; that nothing was said or done to change that agreement or intention; and the documents that were signed were signed, by him at least, in the belief that they gave effect to that agreement and that intention. He sought to support this account by providing a surveyor, Mr Freeman, with particulars of the vine areas which were planted on the front part of Lot 39 in 1971; with Mr Freeman then giving evidence that the total of those areas, including the areas extending about 10 metres into the panhandle of Lot 88, was 17.9 acres. Of this, about 0.7 acres was within the panhandle of Lot 88. Luigi also gave other evidence concerning the road giving access to the rear block, which I will refer to later. He gave evidence that he believed that the area within the panhandle of Lot 88 was in fact included in the front block, and that he knew of no suggestion to the contrary until January 1998. 35   Domenico also gave evidence that he believed that the front block included the panhandle area, and knew of no suggestion to the contrary until January 1998; and that it was in that belief that he spent $50,000 on an irrigation system which included the vines within the panhandle. 36   Mr Blair gave evidence to the effect that the brothers came to him in 1971 with a sketch plan of subdivision and a calculation of monetary adjustment, on the basis that access to the rear block was to be by easement. Mr Blair said that, through Mr Pedler, he ascertained that the local Council required the rear block to have a frontage of about 20 metres to Kilpatrick Road, and that he had a further meeting with the brothers in which he explained this. According to Mr Blair, the brothers went away, and came back with a revised proposal in which they had agreed to reduce the size of the rear Lot to about 20 acres, and increase the size of the front Lot to about 23 acres, to compensate for the Council requirement that the rear Lot have a frontage to Kilpatrick Road. In his affidavit he said that he did not recall if any adjustment was made to the agreed payments; but in his oral evidence he said that his recollection was that there was no such adjustment. 37   Louie gave evidence to the effect that he had always understood that the panhandle was part of the rear Lot and was not just an easement. He said that, when he consulted Mr Gallagher towards the end of 1997, he referred to an easement but only in the context of something which Luigi had said to him. Both Rosa and Louie gave evidence of conversations with Luigi during the 1990s and prior to January 1998 in which Luigi initially said that he could not afford to rectify the situation concerning the panhandle, and subsequently requested that the panhandle be sold by Rosa to him. Louie also gave evidence that, when he saw work being done installing the irrigation system extending on to the panhandle, he asked the members of Luigi's family carrying out the work what they were doing, resulting in swearing and an assertion by them to the effect that he and Rosa did not need that land.

Submissions

38   Mr Gregory for the defendants submitted that Mr Blair's evidence should not be accepted. He kept no record of any of the alleged meetings with the brothers, even the second meeting which, according to Mr Blair's affidavit, was so significant that he recommended that the brothers have an interpreter. His evidence concerning the decision by the brothers to adjust the subdivision, and concerning the calculation of compensation, was not credible. Mr Blair acted incompetently in the transaction: he did not explain documents to the family members; he left original letters intended for the family members on the file; and he failed to carry through the transaction by transfers to the intended recipients of the two Lots. Even the alleged Council requirement for a road frontage depended only on Mr Blair's evidence, and that evidence should not be accepted. 39   Furthermore, Mr Gregory submitted, the plaintiffs themselves understood that they had an easement only: this was shown by the letter of November 1997. It was further supported by the lack of any action by the plaintiffs from the time of the break-up of the partnership in 1991 right through to January 1998. Even the conversations given by Rosa and Louie in evidence, which should not be accepted, contain no assertion that the defendants should not cultivate grapes but should remove the vines and account for profits. The reasons given for this inaction, namely that Luigi was owed money and that they were saving up for legal expenses, defy credibility. 40   Furthermore, in 1994 the defendants engaged in significant capital works extending on to the disputed land. It defies credibility that they would have done this if they had not genuinely believed that they owned the land. 41   Mr Cashion SC for the plaintiffs submitted that I should not accept Luigi's evidence unless it was independently corroborated. He referred to Luigi's demeanour in the witness box, his evidence concerning removal of vines in 1971, and his evidence concerning the road, and to the unlikelihood that the brothers would have agreed to a division as unequal as would follow if the panhandle of Lot 88 was added to Lot 87. 42   Mr Cashion submitted that Mr Blair's evidence should be accepted. The Council requirement referred to by Mr Blair was the only plausible explanation for the change of plan from the original proposal of an easement; and it was highly likely that this was conveyed by Mr Blair to the brothers.

Decision

43   I regret to say that I find myself unable to place much weight on the evidence of Mr Blair. I think Mr Gregory's criticisms of Mr Blair are well founded. It is plain from the circumstances, and also from calculations written out by Mr Blair which are in evidence,

that Mr Blair calculated the adjustments which were made in the partition deed, and did so on the basis of the figures given by the valuation of 30 November 1971. I am unable to accept that there were the three meetings between Mr Blair and the brothers along the lines suggested by Mr Blair. However, I am inclined to accept that there was a Council requirement for a road frontage of around 20 metres: this seems to me to be the most plausible explanation of the change of plan from the easement originally proposed.

44   I also find myself without any confidence in the evidence of Luigi or his son Domenico. This is particularly because of evidence given by both of them, and particularly by Luigi, in relation to the road which gives access to the house on Lot 88. This matter is not one of the most material facts in the case, but it does have significant relevance; and I found the evidence on this matter by Luigi and Domenico to be highly unsatisfactory. 45   In Luigi's first affidavit, sworn 15 April 1999 and resworn on 3 April 2000, there appears (at paragraph 6)the following passage:

From the time of commencement of the development of Lot 39 by the three families in 1957, an area along the western boundary was left unplanted and was used for a roadway for access to the house of Pasquale (the southernmost house) and for access to our house which was in approximately the centre of Lot 39. Sometimes my family and I would access my home via such roadway, and sometimes we would drive along a headland in about the centre of Lot 39 to access Kilpatrick Road.

46   Later in the same affidavit, there appears (at paragraph 11) the following passage:

As to paragraph 15 of Rosa's affidavit, I deny that Rosa's family has always maintained the roadway, and say that, as deposed in paragraph 11 hereof, it is my family which has basically maintained the roadway. Rosa's family did undertake a substantial amount of work in 1995 on the section of the road on Lot 88 to the south of the east-west boundary between Lots 87 and 88.

47   In his affidavit of 22 February 2000 (at paragraph 4), Luigi swore the following:

In 1971, the area which was Lot 39 comprised about 42 acres. It had been planted with vines between 1958 and 1966. There was no further planting until after the subdivision. The disputed area along the western boundary had a carriageway used for road access to Kilpatrick Road and next to this there were vines planted. The carriageway was graded. There was also an east-west headland in about the centre of Lot 39 used by my family as a road access to get across to the western boundary to the north-south roadway that accessed Kilpatrick Road.

48   Later in the same affidavit Luigi (at paragraph 10) said this:

We specifically showed Blair the area the families had been using as carriageways. I said "It has been agreed between us that Lina and I will have this northern area and the access road to Kilpatrick Road will remain part of the northern area which Lina and I will get, but we want Pasquale to have use of the road to get access to his southern area.". Blair said "An easement will have to be created. I will arrange everything."

49   Later on, dealing with a subsequent meeting on the property in 1971 with Mr Blair and Mr Pedler, Luigi said the following (at paragraph (15):

I further said, "As we have agreed the roadway will remain part of the northern Lot 87 and be transferred to me and Lina but you and your family will continue to have the right to use the roadway for access to Kilpatrick Road." Pasquale said "That's right".

50   In an affidavit sworn 20 March 2000, in response to an affidavit by Blaz Markovic which asserted that he built the road from Kilpatrick Road to Rosa's residence in about 1974, Luigi said the following (at paragraph 6):

There had since my brothers and I acquired Lot 39, and well prior to its subdivision into Lots 87 and 88 in 1971, been a roadway along the western boundary of the disputed land, which roadway was gravelled at about the time that Balranald Shire Council bitumenised Kilpatrick Road, the Council supplying the gravel and my two brothers and I retaining Rod Taylor as the contractor to grade the gravel road.
I recall that Markovic did do some roadwork from the southern end of such roadway to Rosa Zaffina's residence, and around the pickers' huts, such roadwork I believe being in about 1992 or 1993.

51   Returning to Luigi's affidavit of 22 February 2000, in response to evidence on behalf of the plaintiffs that in about 1995 the road had been upgraded by Mr Morello working for them, Luigi asserted the following (at paragraph 25):

In about 1994 in the course of my sons installing a drip irrigation system to replace the furrow irrigation, their contractor cut the telephone line from Kilpatrick Road, through the vines on Lot 87 to the plaintiff's residence on Lot 88. Telecom had a contractor, Frank Puleo dig the trench for the laying of the replacement telephone cable but [the roadway] required substantial repair. I saw Morello Earthmoving Pty Ltd trucks and plant effect repair to the roadway in 1994. I was subsequently told by the second plaintiff "Telecom bugged up the road putting in the new line. I made them pay for Morello to fix it up."
Virtually identical evidence about this was given by Domenico.

52   There was evidence from a Telecom employee, Mr Finch, that the damage to the roadway by Telecom occurred in July 1995 when, in response to a statement by Luigi that "the cable should not be on my property", the Telecom cable was moved from the middle of Lot 87 to beside the roadway on the panhandle, such damage to the roadway being dealt with by regrading by a contractor, Mr Thompson, who did it without payment because of a favour owed by him. In response to this evidence, Luigi in his affidavit of 20 March 2000 said the following (at paragraphs 17-19):

Finch is inaccurate in his Affidavit in alleging that the attempted repair and subsequent relocation, of the telephone cable servicing Lot 88 was in 1995, my belief that the said work was effected in about October 1994 being based on the fact that the irrigation installation on Lot 87 was effected in 1994 and not 1995,. as verified by the enclosed copy extract from my file in the records of New South Wales Rural Assistance Authority annexed hereto and marked with the letter "J", the last page of which dated 14 November 1994 verifies works by that date having been completed to the value of $54,776. My recollection is that such irrigation installation on Lot 87 was effected in September and October 1994 and was certainly completed during October 1994.
At the time of damage being sustained to the telephone cable, and to the drip irrigation system referred to in paragraph 12 hereof, I believe that I was in Melbourne as my daughter was very ill at that time.

I recall that after my return from Melbourne I was approached by the second plaintiff on some date I cannot recall, but on Lot 87, when he said to me: "Uncle Louie, there has been a problem with our telephone cable and with your irrigation lines being cut but I have had them repaired and I am asking Telecom to relocate the cable down the road", by which he was referring to the area used as a roadway on the disputed land.
Very similar evidence to this was given by Domenico.

53   Rosa's evidence was to the effect that the only road in existence on the block in 1971 was a road down the middle of the block serving the three houses: a road was not built in the area of the panhandle until 1974, when it was built by Mr Markovic under an arrangement with Pasquale. Mr Markovic gave evidence to the same effect, saying that he was paid by Pasquale. Mr Markovic also gave evidence of further grading of the road in 1987, by arrangement with Pasquale. 54   Mr Morello gave evidence that in September/October 1994, he upgraded the road from Rosa's residence to the public road; and that he dealt with Louie in relation to this and was paid $3550 for the work by him. 55   Mr Finch gave evidence that when, in about May 1995, he was working on a Telecom cable through the middle of Lot 87, Luigi said to him that the cable should not be on his property. Rosa agreed that the cable be moved to the side of the roadway in the panhandle area, and this happened in July 1995. For this purpose, Telstra obtained a road crossing permit from Balranald Shire Council on 20 July 1995, and the relocation of the cable was arranged on 21 July 1995. Heavy rain occurring after the digging of the trench made it necessary to regrade the road, and this was done by Mr Thompson, at no cost, because he owed a favour to Mr Finch and to Telstra. 56   There are in evidence aerial photographs which show that in December 1973, the only made road servicing Rosa's house was a road down the middle of the block; and that, in the area of the panhandle, there was only a dirt headland similar to that dividing the areas planted with grapes. A 1979 aerial photograph shows that, after 1973, a road had been constructed down the panhandle and leading to Rosa's house, giving an access to that house in addition to the access provided by the road down the centre of the block. 57   In my opinion, it is clear beyond argument that the only formed road within Lot 39 in 1971 was that down the centre of the block. The formed road down the panhandle area was built in about 1974 by Mr Markovic, who was paid by Pasquale. The road was then upgraded by Mr Markovic from time to time, by arrangement with Pasquale, including one occasion in 1987. There was a substantial upgrading of the road in 1994 by Mr Morello, who was paid by Louie. This upgrading had nothing whatsoever to do with any damage caused to the road by Telstra. It is possible that Telstra may have been called to repair a telephone cable while work was being done on Lot 87 in about October 1994, but it is clear that the actual moving of the cable which caused some damage to the road occurred in about July 1995; and that the work necessitated on the road by that event was done by Mr Thompson at no cost. 58   Luigi was given ample opportunity to admit that he was in error concerning the existence of the road in 1971, and did not do so. The existence of the road at that time is of relevance to his case, because the conversations which I have quoted proceed on the assumption that the road was there. Luigi sought to adhere to the assertion that the road was maintained by his family by first suggesting that the work arranged by Rosa's family in the 1990s was only done on that part of the road south of the panhandle, and next by suggesting that Mr Morello's work was due to Telstra damage, and was paid for by Telstra. Plainly both suggestions are wrong; and it is difficult to see how Luigi's assertions about the work arranged for by Rosa's family being confined to the area to the south of the panhandle could be other than deliberately dishonest. 59   Having regard to these findings, it is in my opinion clear beyond argument that the statement alleged in identical terms by Luigi and Domenico to have been made by Louie, to the effect that Telecom "bugged up" the road and that he made them pay for Morello to fix it up, did not occur. In my opinion, this evidence is either deliberately false, or at best shows a strong tendency in both witnesses to reconstruct events to suit their perceived interests. 60   I accept Mr Finch's evidence that Luigi requested the removal of the cable from his land. The evidence from Luigi and Domenico that Louie told them that he had requested that this happen is again, in my opinion either deliberately false or involves very substantial reconstruction. 61   My inability to rely on Luigi's evidence is confirmed by the way he dealt with evidence in his original affidavit that he and his brothers extended the headland along the southern boundary of Lot 87 in 1971. This was corrected as a mistake in a later affidavit; but in his oral evidence Luigi was very concerned to say it was not his mistake, but a mistake by the person who prepared the affidavit, which he did not understand. I accept that Luigi cannot read English, and that his understanding of English is far from perfect,, and I make full allowance for this. But the probability is that the original affidavit was based on his instructions, and that his reference to a mistake in his later affidavit was a reference to his own mistake; and his claim in the witness box that it was not his mistake, and the manner of his making that claim, are in my opinion further indications of his unreliability as a witness. 62   One other matter going to the probabilities of what happened in 1971 is the reference in the valuer's letter to 18 acres of vines planted on Lot 87. As I have mentioned, a surveyor, Mr Freeman, has asserted that, based on areas given to him by Luigi, 17.9 acres were planted on Lot 87 if one includes 0.7 acres planted on the panhandle. However, it is plain that the areas given by Luigi to Mr Freeman are not completely accurate: they are probably inaccurate to the extent that they omit areas generally conforming to areas marked on Exhibit P5, with the possible exception of the area marked on Exhibit P5 furthest to the right. Doing the best I can based on the evidence I have, I would estimate that the vines planted in 1971 on Lot 87 covered about 18.4 acres, if one includes the 0.7 acres planted in the panhandle, and covered about 17.7 acres, if one excludes that 0.7 acres. Accordingly, in my opinion, the reference to 18 acres in the letter of valuation is equivocal. 63   Turning finally to what I believe did happen in 1971, it is clear that there was initially an intention that access to the rear Lot would be given by an easement. On the balance of probabilities, I find that this did not go ahead because the Council required a frontage of about 20 metres to the public road. This was probably conveyed to the brothers by Mr Blair and/or Mr Pedler, although there could be a question as to their understanding of it: however, I am not satisfied that they did not understand it. In my opinion, the surveyor Mr Pedler did peg out the property in accordance with the subdivision which he ultimately prepared. In my opinion, on the balance of probabilities, Mr Pedler showed Luigi the corners of the blocks as surveyed for the subdivision: whether or not Luigi understood is another question. As I have mentioned, the five parties signed the deed of partition: again, whether or not they understood it is another question. Three of the parties, probably the three brothers, signed the Deposited Plan in about 1974: again, whether or not they understood it is another question. 64   Notwithstanding all these matters, the circumstances of the work done in 1976 changing the direction of the vine rows and the work done in 1994 on irrigation, give some support to the suggestion that Luigi's family believed they had some entitlement to the area planted with vines on the Lot 88 panhandle. However, at the time of the work in 1976, the partnership was still in operation, and I am not satisfied by the mere fact of that work that Luigi believed that he owned the area in question. Turning to the 1994 work, I think it is pertinent to note that, even in October 1998 when Luigi and Domenico had clearly been put on notice that the panhandle was included in Rosa's title and that Rosa claimed full ownership, nevertheless they were prepared to physically take down a fence being erected by Louie on the panhandle. In the light of that, and in the light of my lack of confidence in the evidence of Luigi and Domenico, I am not satisfied by the fact of the work being done in 1994 that they at that time believed that they owned the panhandle area. 65   It was suggested that the instructions given to Mr Gallagher in October 1997 showed that Rosa and Louie believed they only had an easement; and that this is confirmed by the lack of any steps taken by them to secure control of the area until January 1998. I accept Louie's evidence that he gave the instructions, and I am not satisfied that the reference to easement by the solicitor was not due to a misunderstanding. In my opinion, the explanation given by Rosa and Louie for not pursuing the matter earlier is a plausible one. I am not satisfied that Rosa and Louie believed they only had an easement in the 1990s, prior to January 1998.

RECTIFICATION OR TRUST

66   Mr Gregory submitted that the evidence justified the conclusion that there was no change in the intention of the parties that there be an easement; that the evidence justified a finding that the boundary agreed upon was the existing southern boundary of Lot 87 extended to the western boundary of Lot 39; and that the method of compensation had been agreed, so that only a calculable adjustment was required. 67   Mr Gregory submitted that equity would grant relief where writing by common mistake fails to express the agreement of the parties or their common intention accurately: Maralinga Pty Ltd v Major Enterprises (1973) 128 CLR 336 at 350. The presumption that a written document executed by the parties is a true record of their agreement can be displaced if there is clear evidence of a mistake in recording their agreement: Cheshire & Fifoot Law of Contract (7th Aust ed) at par 12.29. Equity could grant relief to achieve the true agreement or common intention of the parties: Maralinga; Silovi Ltd v Barbaro (1988) 13 NSWLR 466 at 468, 471, 475. Relief could be granted on the uncorroborated evidence of the claimant: Plunkett v Bull (1915) 19 CLR 544.

Decision

68   In my opinion, to be entitled to the relief of a declaration of the existence of a trust, the cross-claimants would have to satisfy the requirements for rectification of written documents: that is, they would have to satisfy me by appropriately clear evidence that there was, at least, a common continuing intention of the parties different from that disclosed in the documents, that the documents were signed in the mistaken belief that they gave effect to the common continuing intention, and that the Court can conclude, with appropriate clarity, both the substance and the detail of what was intended. 69   In circumstances where I am not able to rely on Luigi's evidence, in my opinion I cannot be satisfied of any of these matters. I am not satisfied that Luigi's intention, by the time the subdivision was carried out, was inconsistent with the effect of the subdivision A fortiori, I am not satisfied as to Pasquale's intention. Even if I had some faith in Luigi's evidence, I do not think I could find the intended terms with sufficient clarity. I would not be clear on the location of the boundary between the two Lots. I would not be satisfied that the parties really intended a division so unequal as a division which gave rise to one Lot of over 24 acres and another Lot of about 18½ acres. I would find it difficult to be satisfied that the agreed compensation would simply be a matter of applying a formula to these different areas. 70   However that may be, my inability to rely on Luigi's evidence is in my opinion fatal to the cross-claimants' case on this point.

ESTOPPEL
Submissions

71   Mr Gregory submitted that the cross-claimants thought that Lot 87 included this strip of land, and expended money and did other acts upon the faith of this belief. The plaintiffs encouraged the defendants in this expenditure of money and other acts. See Dewhirst v

Edwards (1983) 1 NSWLR 34; Waltons v Maher (1988) 164 CLR 307 at 428-9. A court exercising equitable jurisdiction could grant appropriate relief, including an interest in land: S ilovi at 468, 471-2, 475. There must be proportionality between the detriment or material disadvantage grounding the estoppel and the remedy awarded: Commonwealth of Australia v Verwayen (1990) 170 CLR 394.

Decision

72   My finding that I am not satisfied concerning the belief of Luigi or Domenico is in my opinion fatal to the claim based on estoppel. Further, I am not affirmatively satisfied that Rosa and Louie did not during the 1990s assert their interest, or that Luigi and Domenico did not acknowledge it. Furthermore, the action of Luigi's family in destroying the fence after being notified of Rosa's claim is a further reason for my lack of satisfaction that Luigi and Domenico were relying on lack of assertion by Rosa of her rights in undertaking the expenditure which they did.

DAMAGES
Submissions

73   Mr Cashion submitted that damages should be awarded from the dissolution of the partnership at the rate of either $1400 per annum or $2500 per annum, these being profit figures from the vines on the panhandle area suggested by the defendants' evidence. 74   Mr Gregory submitted that there should be no damages, because there is no evidence that the plaintiffs would have used the area in question for vines or otherwise for profit.

Decision

75   I am not satisfied that there was any unequivocal demand that the vines be removed until about January 1998. Having regard to the history of the matter, I do not think the continued existence of the vines and their cultivation and harvesting up to that time can be regarded as a trespass. However, the demand was made in about January 1998 that the vines be removed at the end of the current season. I do not have evidence as to exactly what that means. Also I do not have evidence as to exactly what the plaintiffs proposed to do with the land themselves. I do not think that this means that the plaintiffs are not entitled to damages. I think the appropriate measure of damages would be at the rate of $1400 per annum for a period of two years up to the present, that is commencing about three months after the demand for possession was made. Accordingly I propose to award damages in the sum of $2800.

CONCLUSION

76   For these reasons, in my opinion the plaintiffs are entitled to orders which will assure to them the possession of the disputed area. They are also entitled to damages of $2800, which at present I consider should be against both defendants. My tentative view is that the defendants should pay the plaintiffs' costs of the proceedings.

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Last Modified: 09/25/2000