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Zekry v Zekry

Zekry v Zekry

Case [2020] VSCA 336 23 December 2020

Constructive Trust

Common Intention Constructive Trust

Joint Endeavour Constructive Trust

Trusts & Equity

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SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2020 0058

NAGI ZEKRY	Applicant
v
MARGRITTE ZEKRY	Respondent

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JUDGES:	TATE, KYROU and NIALL JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	19 October 2020
DATE OF JUDGMENT:	23 December 2020
MEDIUM NEUTRAL CITATION:	[2020] VSCA 336
JUDGMENT APPEALED FROM:	[2020] VSC 220 (McMillan J)

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EQUITY & TRUSTS – Common intention constructive trust – Joint endeavour constructive trust – Applicant claimed to have made financial and non-financial contributions to properties – Legal title to properties held by respondent – Whether common intention of applicant (son), respondent (mother) and late husband (father) that 50 per cent interest in properties would be held on trust for benefit of applicant – Whether common intention inferred from parties’ actions – Whether parties entered into a joint endeavour concerning properties – Position of respondent once she became registered proprietor – Muschinski v Dodds (1985) 160 CLR 583, Baumgartner v Baumgartner (1987) 164 CLR 137 applied – Declaration that respondent holds her interest in one property on trust for herself beneficially as to 50 per cent and for the applicant beneficially as to 50 per cent.

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APPEARANCES:	Counsel	Solicitors
For the Applicant	Mr M Gronow QC with Mr A Ford	Victorian Bar Duty Barristers’ scheme
For the Respondent	Ms E Konstantinou	Fleming & Rhoden Lawyers

TATE JA
KYROU JA

NIALL JA:

The respondent is the mother of the applicant. She is the sole registered proprietor of two residential properties in Melbourne. They are 38 Robjant Street, Hampton Park (‘Hampton Park’) and 36 Santa Cruz Boulevard, Roxburgh Park (‘Roxburgh Park’).

On 13 March 2003, Samir Zekry (‘Samir’), the respondent’s late husband, and the applicant’s father, became the sole registered proprietor of Hampton Park. On 9 February 2017, Samir transferred Hampton Park to the respondent, with a stated consideration of ‘natural love and affection’. Hampton Park is currently the subject of a contract of sale, settlement of which was due to take place on 30 March 2018 but which has been delayed due to the current dispute.

On 12 July 2017, the respondent became the registered proprietor of Roxburgh Park, subject to a mortgage in favour of Westpac.

The applicant claims that the respondent holds title to both properties subject to an equitable interest in his favour. At trial, he contended that it was the common intention of Samir, the respondent and the applicant that Hampton Park would be held by Samir and subsequently by the respondent on trust in favour of the applicant as to 50 per cent and, when Roxburgh Park was purchased, that the respondent and Samir would own and live in that property while the applicant would beneficially own and live in Hampton Park. Alternatively, he contended that he was the beneficial owner of 50 per cent of both properties pursuant to a constructive trust that arose because the properties, and some other properties that had been acquired and sold in the interim, had been acquired as part of a joint endeavour…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Zekry v Zekry

Details

AGLC: Nagi Zekry v Margritte Zekry [2020] VSCA 336
Case: [2020] VSCA 336
Decision Date: 23 December 2020

CaseChat Overview and Summary

The case of Zekry v Zekry involved a dispute between the applicant, who was the son, and the respondent, who was his mother. The son sought to establish a common intention constructive trust and a joint endeavour constructive trust in relation to certain properties. He argued that he had made significant financial and non-financial contributions to the properties, which were legally owned by the respondent, his mother. The son contended that there was a common intention that a 50% interest in the properties would be held on trust for his benefit, stemming from the joint efforts and understandings of himself, his mother, and his late father. The court was tasked with determining whether this common intention could be inferred from the parties' actions and whether they had entered into a joint endeavour concerning the properties. The son also sought to understand the respondent's position once she became the registered proprietor of the properties.

The legal issues at the heart of this case revolved around the existence and nature of any common intention or joint endeavour concerning the properties, and whether the son's contributions warranted a resulting or constructive trust in his favour. The court had to consider the principles established in Muschinski v Dodds and Baumgartner v Baumgartner to assess whether the son's contributions and the parties' conduct gave rise to a trust. The court also needed to evaluate the respondent's position as the registered proprietor and how this affected any potential trust arrangement.

The court found that there was indeed a common intention between the parties that a 50% interest in the properties would be held on trust for the son's benefit. This conclusion was drawn from the son's substantial financial and non-financial contributions to the properties and the overall joint efforts of the parties. The court held that the common intention was not just a mere agreement but was manifested through the parties' actions and conduct. The son's contributions and the parties' shared endeavours in relation to the properties were sufficient to establish a joint endeavour constructive trust. The court also determined that the respondent's status as the registered proprietor did not negate the existence of the trust.

The court ordered that the respondent hold her interest in one of the properties on trust for herself beneficially as to 50% and for the son beneficially as to 50%. This outcome recognised the son's significant contributions and the parties' shared understanding regarding the ownership of the property.

Orders