Kanjian Holdings No 1 Pty Ltd v Kanjian; Kanjian v Kanjian (No 3) [2021] NSWSC 839

Supreme Court New South Wales

Medium Neutral Citation: Kanjian Holdings No 1 Pty Ltd v Kanjian; Kanjian v Kanjian (No 3) [2021] NSWSC 839 Hearing dates: 18 and 19 December 2019, 23, 24, 25, 26 and 27 March 2020, 30 and 31 March 2020, 1, 2 and 3 April 2020, 6 April 2020, 8 April 2020, 9 and 10 July 2020 and 21 August 2020. Decision date: 12 July 2021 Jurisdiction: Equity Before: Henry J Decision: See paragraphs [1118] and [1119]. Catchwords: EVIDENCE – Exclusion of evidence – Improperly or illegally obtained evidence – where non-party recorded a conversation between parties without their knowledge or consent – whether recording unlawful under s 7(1)(b) of the Surveillance Devices Act 2007 (NSW) – whether probative value of recording outweighs undesirability of its admission into evidence – recording admitted EQUITY – Undue influence – where elderly parents' making of directors' resolutions, authorities, directions, powers of attorney, guardianships and revocations challenged by eldest son but not by the parents – where independent legal advice received on some of the documents – where unconscionable conduct and dishonest misrepresentations also alleged – whether actual undue influence established – whether presumption of undue influence rebutted – whether lack of capacity by undue influence – where dealings not objectively improvident – undue influence established in relation to one power of attorney but not established for other documents ESTOPPEL – Estoppel by convention – Mutual assumption – where party asserting estoppel over right to hold share in family company gave up right of appointment of trustee and undertook management of properties – where said party continued holding voting share on trust – whether parties adopted common assumption that beneficiary would not call for share transfer during his lifetime – whether detrimental reliance established – beneficiary estopped from calling for share transfer ESTOPPEL – Equitable estoppel – Proprietary estoppel – Encouragement – Detrimental reliance – where alleged promise or representation to leave property to in a will – where promisee and representee continued to manage property and did not seek reimbursement of other costs – whether detrimental reliance established – no estoppel found EQUITY – Trusts and trustees – Court's supervision of – Appointment and removal of trustees – where director of trustee company procured entry into agreement for lease against wishes of some beneficiaries – where breakdown of relations between two of three directors and between one director and the beneficiaries of trustee company – whether director breached duties or procured trustee company to breach duties – trustee not removed Legislation Cited: Civil Procedure Act 2005 (NSW), s 56 Conveyancing Act 1919 (NSW), ss 23C, 54A, 88K Corporations Act 2001 (Cth), ss 180, 181,182, 1317H Evidence Act 1995 (NSW), ss 135(a), 138, 140(2) Guardianship Act 1987 (NSW), s 6L NSW Trustee and Guardian Act 2009 (NSW), s 41(1)(a) Powers of Attorney Act 2003 (NSW), ss 19, 35(1), 36(1), 36(3), 36(3A), 50(3), 50(11) Supreme Court Act 1970 (NSW), s 68 Surveillance Devices Act 2007 (NSW), ss 4(1), 7(1)(b), 7(3)(b)(i) Trustee Act 1925 (NSW), s 70 Uniform Civil Procedure Rules 2005 (NSW), rr 14.14, 15.3 Cases Cited: Ajayi (t/as Colony Carrier Co) v RT Briscoe (Nigeria) Ltd [1964] 3 All ER 556; 1 WLR 1326 Alliance Craton Explorer Pty Ltd v Quasar Resources Ltd [2010] SASC 266 Antov v Bokan [2018] NSWSC 1474 Ashton v Pratt (2015) 88 NSWLR 281; [2015] NSWCA 12 Aspinall v Aqua Sports Pty Ltd [2018] NSWSC 706 Austotel v Franklins (1989) 16 NSWLR 582 Australian Securities & Investments Commission v Maxwell (2006) 59 ACSR 373; [2006] NSWSC 1052 Bridgewater v Leahy (1998) 194 CLR 457; [1998] HCA 66 Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34 Brooks v Burns Philp Trustee Company Ltd (1969) 121 CLR 432; [1969] HCA 4 Byrnes v Kendle (2011) 243 CLR 253; [2011] HCA 26 Calvo v Ellimark Pty Ltd [2016] NSWCA 136 Castle Constructions Pty Ltd v Sahab Holdings Pty Ltd (2013) 247 CLR 149; [2013] HCA 11 Castle Constructions Pty Ltd v Sahab Holdings Pty Ltd (No 2) [2013] HCA 44 Chao v Chao [2008] NSWSC 584 Chetwynd v Rose [2020] NSWSC 111 Commercial Bank of Australia Limited v Amadio (1982) 151 CLR 447; [1983] HCA 14 Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Aust) Ltd (1986) 160 CLR 226; [1986] HCA 14 Cubillo v Commonwealth of Australia (No 2) (2000) 174 ALR 97; [2000] FCA 1084 Day v Perisher Blue Pty Limited (2005) 62 NSWLR 731; [2005] NSWCA 110 Delaforce v Simpson-Cook (2010) 78 NSWLR 483 Derry v Peek (1889) 14 App Cas 337 DHJPM Pty Ltd v Blackthorn Resources Ltd (formerly called AIM Resources Ltd) (2011) 83 NSWLR 728; [2011] NSWCA 348 Dlakic by his tutor Dlakic v Vaughan [2018] NSWSC 1455 Dong v Song [2018] ACTSC 82 Doulaveras v Daher [2009] NSWCA 58 DW v R [2014] NSWCCA 28 Ell v Ell [2015] NSWCA 38 Fay v Moramba Services Pty Ltd [2009] NSWSC 1428 Fisher-Pollard by her tutor Fisher-Pollard v Fisher-Pollard [2018] NSWSC 500 Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 Gibbons v Wright (1954) 91 CLR 423; [1954] HCA 17 Giumelli v Giumelli (1999) 196 CLR 101; [2010] HCA 10 Grundt v Great Boulder Proprietary Gold Mines (1937) 59 CLR 641; [1937] HCA 58 Hanna v Raoul [2018] NSWCA 201 Harlowe's Nominees Pty Ltd v Woodside (Lakes Entrance) Oil Co (1968) 121 CLR 483; [1968] HCA 37 Hartigan Nominees Pty Ltd v Rydge (1992) 29 NSWLR 405 Hawcroft v Jamieson [2017] NSWSC 1478 Heperu v Belle (2009) 76 NSWLR 230; [2009] NSWCA 252 Herrman v Simon (1990) 4 ACSR 81 Hiscox v Outhwaite [1992] 1 AC 562 Hotien Holdings Pty Ltd v Frits Maré [2007] NSWSC 599 Howard Smith Ltd v Ampol Petroleum Ltd [1974] 1 NSWLR 68; [1974] AC 821 Huguenin v Baseley (1807) 33 ER 526 In re Alma Spinning Company (Bottomley's Case) (1880) 16 Ch D 681 ING Funds Management Ltd v ANZ Nominees Ltd [2009] NSWSC 243 Ingot Capital Investments Pty Ltd v Macquarie Equity Capital Markets Ltd [2008] NSWCA 206 Jarrett v Perpetual Trustee Co Ltd (2007) 64 ACSR 552; [2007] NSWSC 1231 Johnson v Buttress (1936) 56 CLR 113; [1936] HCA 41 Juul v Northey [2010] NSWCA 211 Kanjian v Kanjian [2019] NSWSC 166 Kauter v Hilton (1953) 90 CLR 86; [1953] HCA 95 Kooma Aboriginal Corp for Land v Goolburri Regional Council of the Aboriginal & Torres Strait Islander Commission [1999] FCA 82 Legal Services Board v Gillespie-Jones (2013) 249 CLR 493; [2013] HCA 35 Louth v Diprose (1992) 175 CLR 621; [1992] HCA 61 Magill v Magill (2006) 226 CLR 551; [2006] HCA 51 Maguire v Makaronis (1997) 188 CLR 449; [1997] HCA 23 Miller Heiman Pty Ltd v Sales Principles Pty Ltd (2017) 94 NSWLR 500; [2017] NSWCA 106 Miller v Cameron (1936) 54 CLR 572; [1936] HCA 13 Milling v Hardie [2014] NSWCA 163 Moratic Pty Ltd v Gordon (2007) 13 BPR 24,213; [2007] NSWSC 5 Mummery v Irvings Pty Ltd (1956) 96 CLR 99; [1956] HCA 45 Nanosecond Corporation Pty Ltd v Glen Carron Pty Ltd (2018) 132 SASR 63; [2018] SASC 116 Parker v Higgins [2012] NSWSC 1516 Permanent Building Society (in liq) v Wheeler (1994) 11 WAR 187 Plunkett v Bull (1915) 19 CLR 544 Poland v Hedley [2019] WASC 403 Preston v Diaspora Holdings Pty Ltd; Diaspora Holdings Pty Ltd v Owners Corporation of Strata Plan 68608 [2019] NSWSC 651 Priestley v Priestley [2017] NSWCA 155 Queensland Independent Wholesalers Ltd v Coutts Townsville Pty Ltd [1989] 2 Qd R 40 R v Byrnes (1995) 183 CLR 501; [1995] HCA 1 Rathswohl v Court [2020] NSWSC 1490 Re QFC (No 2) [2018] NSWCATGD 49 Re Reserve Hotels Pty Ltd [2021] NSWSC 376 Riches v Hogben [1985] 2 Qd R 292 Riz v Perpetual Trustee Australia Ltd [2007] NSWSC 1153 Roden v International Gas Applications (1995) 18 ACSR 454 Rose v Rose (1986) 7 NSWLR 679 Rosenbaum v Baidarman (No 2) [2021] NSWSC 574 RRG Nominees Pty Ltd v Visible Temporary Fencing Australia Pty Ltd (No 3) [2018] FCA 404 Saunders v Vautier (1841) 4 Beav 115; (1841) 49 ER 282 Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd [2019] NSWSC 1201 Senses Northbridge Pty Ltd v Sahab Holdings Pty Ltd (No 3) [2020] NSWSC 345 Sepulveda v R [2006] NSWCCA 379 Sidhu v Van Dyke (2014) 251 CLR 505; [2014] HCA 19 Silovi Pty Ltd v Barbaro (1988) 13 NSWLR 466 Steinberg v Commissioner of Taxation (Cth) (1975) 134 CLR 640; [1975] HCA 63 Strategic Management Australia AFL Pty Ltd v Precision Sports & Entertainment Group Pty Ltd (2016) 114 ACSR 1; [2016] VSC 303 Swiss Screens (Australia) Pty Ltd v Burgess (1987) 11 ACLR 756 Szozda v Szozda [2010] NSWSC 804 Tam v Tang [2013] NSWSC 708 Thomas v Nash (2010) 107 SASR 309; [2010] SASC 153 Thompson v Palmer (1933) 49 CLR 507; (1933) HCA 61 Thorne v Kennedy (2017) 263 CLR 85; [2017] HCA 49 Tillett v Varnell Holdings Pty Ltd [2009] NSWSC 1040 Titterton v Oates (1998) 143 FLR 467 Turner v O'Bryan-Turner [2021] NSWSC 5 Vanguard Financial Planners Pty Ltd v Ale (2018) 125 ACSR 1 Walker v Corboy (1990) 19 NSWLR 382 Walsh v Walsh [2012] NSWCA 57 Watkins v Combes (1922) 30 CLR 180; [1922] HCA Watson v Foxman (1995) 49 NSWLR 315 Zugic v Vesuvius Australia Pty Ltd [2020] NSWSC 106 Texts Cited: Austin, Ford and Ramsay, Company Directors: Principles of Law & Corporate Governance (2nd ed, LexisNexis Butterworths, 2005) Barnes, The Law of Estoppel (Hart Publishing, 2020) Dal Pont, Equity and Trusts in Australia (6th ed, 2015, Thomson Reuters) Heydon and Leeming, Jacobs' Law of Trusts in Australia (8th ed, 2016, LexisNexis Butterworths) Category: Principal judgment Parties: Proceedings No 2018/150768