Milutinovic v Milutinovic [2004] NSWSC 1110

New South Wales Supreme Court

CITATION : Milutinovic v Milutinovic [2004] NSWSC 1110 HEARING DATE(S) : 16 & 17 November 2004 JUDGMENT DATE : 24 November 2004 JURISDICTION: Equity JUDGMENT OF : Campbell J DECISION : Transfer of interest in land valid

CATCHWORDS : PRINCIPAL AND AGENT - powers of attorney - transfer of land effected pursuant to power of attorney - no question of principle - TORRENS SYSTEM - indefeasibility of title - volunteer becomes registered proprietor LEGISLATION CITED : Real Property Act 1900 Evidence Act 1995 CASES CITED : Bogdanovich v Koteff (1988) 12 NSWLR 472 Dusan Milutivonic - Plaintiff Zoran Milutivovic - First Defendant PARTIES : Milica Milutinovic - Second Defendant Emilia Milutinovic - Third Defendant Borka Milutinovic - Fourth Defendant FILE NUMBER(S) : SC 5623/03 COUNSEL : S Stojanovic, solicitor - Plaintiff A Enright - Defendants SOLICITORS : Stojanovic Solicitors - Plaintiff Mark Brown & Associates - Defendants

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION EQUITY LIST

CAMPBELL J

24 NOVEMBER 2004

5623/03 DUSAN MILUTINOVIC v ZORAN MILUTINOVIC & ORS JUDGMENT 1 HIS HONOUR: The plaintiff in this action ("Mr Milutinovic") is the husband of the fourth defendant ("Mrs Milutinovic"). The first defendant ("Zoran") is their only child. 2 The dispute relates to a house and land located at 33 Barkly Close Bonnyrigg, being the land in Folio Identifier 33/787762 ("the Property"). At one time, Mr Milutinovic, Mrs Milutinovic, Zoran, and Zoran's then wife, were registered proprietors of the Property, in equal shares. On 15 July 1996 Mr Milutinovic gave a General Power of Attorney to Mrs Milutinovic. That Power of Attorney was witnessed by Mr Kington, solicitor. Mr Milutinovic left for Yugoslavia, his home country, on 18 July 1996, and remained there for nearly six years. 3 Pursuant to a transfer which was executed on 29 April 1998, and registered on 14 October 1998, Mrs Milutinovic transferred to Zoran both her own one-quarter share in the Property, and, purportedly acting under the General Power of Attorney, Mr Milutinovic's quarter share in the Property. In these proceedings, Mr Milutinovic seeks to undo that transfer so far as his one-quarter share is concerned, and have trustees for sale appointed to the property, or alternatively to recover compensation for the interest in the Property which he lost by reason of the transfer. 4 The second and third defendants are the daughters of Zoran and his former wife. Zoran's former wife transferred to them her one-quarter interest in the Property in October 2002, as part of a family law settlement between her and Zoran. They are properly made parties to the proceedings, because their interests could be affected if trustees for sale were appointed, but Mr Milutinovic makes no claim in these proceedings to their interest in the Property. Purchase of the Property 5 Mr and Mrs Milutinovic, Zoran and his wife purchased the Property in 1989 for $103,000. At that time it was vacant land. Mr Milutinovic had had an accident at work in 1986, when he was aged about 53, after which he had not resumed employment. He received a workers' compensation settlement in connection with that accident, of $40,000 or thereabouts. He contributed part of that settlement money towards the purchase price of the land. He paid the whole of the ten percent deposit ($10,300). The purchasers between them contributed an additional $10,300 in equity, and paid for the legal and stamp duty connected with the purchase. Those remaining costs which were paid for by the purchasers were contributed partly by Mr Milutinovic, and partly by Zoran and his wife. Eighty percent of the purchase price ($82,400) was raised on a loan from the Commonwealth Bank of Australia. Zoran and his wife made nearly all repayments concerning that loan, apart from a final payment of $74,658 which was made from the proceeds of sale of a unit which Mr and Mrs Milutinovic had owned at Cabramatta. Though the title to that unit at Cabramatta was solely in the names of Mr and Mrs Milutinovic, Zoran and his wife had made some contributions towards mortgage payments connected with it, particularly after Mr Milutinovic ceased working in 1986. Mr and Mrs Milutinovic, and Zoran and his wife, had all lived at the Cabramatta unit. 6 A house was constructed on the land in 1992, at a cost of about $140,000. That sum came partly from savings which Zoran and his wife had of around $60,000, and $80,000 was raised on a further mortgage from the Commonwealth Bank of Australia. Zoran and his wife were the only ones who gave a personal covenant concerning that mortgage. They made nearly all the repayments on that loan, until it was fully discharged in 1999. Once the house was constructed, all four registered proprietors lived there, along with the two daughters of Zoran and his wife. The Former Issue about Validity of the Power of Attorney 7 In March 2003 Mr Milutinovic lodged a caveat against the title to the Property, which claimed an estate or interest described as an "Equitable interest in the property formerly owned by me and fraudulently transferred by my wife and son". The facts alleged in the caveat to give rise to that estate or interest were: "On or about 14th October 1998 pursuant to a fraudulent Power of Attorney my wife Borka Milutinovic transferred my interest in the said property without my consent to my son Zoran Milutinovic."