New South Wales Supreme Court CITATION : Evans & Ors v Evans & Anor [2004] NSWSC 184 HEARING DATE(S) : 16/02/04, 17/02/04, 18/02/04, 19/02/04, 20/02/04 JUDGMENT DATE : 23 March 2004 JURISDICTION: Equity JUDGMENT OF : Cripps AJ DECISION : Declaration of Constructive Trust CATCHWORDS : Contract - Constructive Trust - Remedy LEGISLATION CITED : Conveyancing Act 1919 FIRST PLAINTIFF Laura Grace Evans SECOND PLAINTIFF Susan Heather Calderbank THIRD PLAINTIFF Timothy Martin Grace Evans FOURTH PLAINTIFF PARTIES : Peter James Evans FIFTH PLAINTIFF Adam Lewis Evans FIRST DEFENDANT Andrew Grant Evans SECOND DEFENDANT Dianne Grace Evans FILE NUMBER(S) : SC 3778/01 PLAINTIFFS COUNSEL : Mr R J Powell SC with Mr I G A Archibald DEFENDANTS Mr A M Colefax PLAINTIFFS SOLICITORS : Farrell Lusher DEFENDANTS Walsh & Blair - 1 - IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION CRIPPS AJ Tuesday 23 March 2004 3778/01 LAURA EVANS & ORS v ANDREW EVANS & ANOR JUDGMENT 1 HIS HONOUR: The first-named plaintiff (Laura Evans) is the mother of the second, third, fourth and fifth named plaintiffs (being respectively Susan Calderbank, Timothy Evans, Peter Evans and Adam Evans). She is also the mother of the first named defendant (Andrew Evans) and the mother-in-law of the first named defendant's wife, the second named defendant (Dianne Evans). 2 In a statement of claim filed in the Equity Division of the Supreme Court in July 2001 it was alleged, inter alia, that Andrew and Dianne Evans acquired a property known as Evanwood from the first named plaintiff Laura Evans and held it on trust for the other children of Laura Evans (being the second, third, fourth and fifth named plaintiffs as well as the first named defendant). 3 Andrew and Dianne Evans became the owners of Evanwood as joint tenants on 20 March 1997. It was transferred to them by Laura Evans who inherited it from the estate of the late Peter Evans her former ex husband. 4 The plaintiffs' case is that Andrew and Dianne Evans acquired the property for no consideration (or at least for consideration which was instantly forgiven upon the signing of the contract) in circumstances entitling the plaintiffs to a declaration that Evanwood is held in trust for Susan, Timothy, Peter and Adam Evans (as well as Andrew Evans) and an order that Evanwood vest in trustees upon statutory trust for sale pursuant to Div 6 of Pt 4 of the Conveyancing Act 1919. In the alternative they claim that each of the plaintiffs (other than Laura Evans) are entitled to damages by reason of the repudiation by the defendants of a contract entered into by them – that being that all members of the family agreed, at Laura's insistence, that Evanwood should go to Andrew subject to Andrew paying each of his siblings one-fifth of the value of Evanwood as at 7 September 1996 on or before 7 September 2000. 5 Before dealing with the plaintiffs' case I should note that it was also alleged in the statement of claim that in or about July 1997 Laura Evans entered into a farming partnership with Andrew and Dianne Evans and that the Court should order that the Master in Equity should take accounts and inquire into partnership dealing. A partnership between Andrew and Dianne Evans on the one hand and Laura Evans on the other was entered into about the middle of 1997 and there has since been a falling out between them. However the partnership claim was not pressed in these proceedings. 6 Andrew and Dianne Evans deny they hold the land on trust as alleged or that they are under any obligation in law or in equity to account to Andrew's siblings arising out of their ownership of Evanwood. They assert that Evanwood was transferred to them free of any conditions and that neither was a party to any contract as alleged by the plaintiffs. 7 In order to understand the competing contentions it is necessary to have regard to the family history. 8 Laura Evans and Peter Evans were married in September 1953. They had five children. 9 In November 1966 Laura and Peter (I propose using the first name of each member of the family for convenience not intending any disrespect) made mutual wills each devising the whole of his or her estate to the other. During their married life Peter and Laura purchased a hotel at Tumut in 1969 and "Evanwood" in 1974. 10 In 1985 Peter and Laura were divorced and in the property settlement that followed Laura received the net proceeds of sale of the Tumut Hotel ($400,000) and Peter became the sole owner of Evanwood. Although Laura and Peter were divorced they remained on friendly terms until Peter's death in September 1996 and, in fact, lived together intermittently. 11 Of peripheral relevance to the dispute is the purchase by Andrew of a property known as Vitonga in 1992. Andrew does not dispute his mother contributed money to the purchase of Vitonga but claims it was in an amount of $78,000 and not, as she claims, in an amount of $105,000. 12 Prior to his death Peter lived on Evanwood as did Andrew and Dianne. On 7 September 1996 Peter died after suffering a massive stroke which left him unconscious for many days in Concord Hospital. Eventually, and with the consent of his family, the life support systems were switched off. 13 At the time Peter was admitted to Concord Hospital his daughter Susan lived in England and Timothy in Moree. All children met at Concord Hospital with their mother Laura. There was a discussion among the children concerning the disposition of Evanwood following Peter's inevitable death. It was the stated opinion of her children that Laura had already received her full entitlement from Peter's estate when she received $400,000 in 1987. The plaintiffs' claim that all members of the family agreed that Andrew would remain on Evanwood and eventually become the owner of it provided he paid to his siblings a one-fifth share of the value of Evanwood. I mention that Andrew denies he was a party to any such agreement although, if I understand his evidence correctly he does not dispute these matters were discussed. He says he was appalled by the callousness of his brothers and sister bearing in mind that the conversations I have referred to above took place shortly before and just after his father died. 14 Shortly after Peter's death the family were advised that he had not altered his will and Evanwood was left to Laura. Legal advice was sought and counsel's opinion taken. Counsel advised that the will was valid because it was made before 1 November 1989 and the provision in favour of Laura did not fail notwithstanding that at the date of his death Laura was not his wife. 15 The children, on becoming aware of the terms of Peter's will had contemplated taking legal proceedings although the precise nature of the contemplated proceedings was not made clear and in any event after Laura made her will (to be referred subsequently) the contemplated challenge appeared to peter out. 16 I find Laura was angry that her children should be talking about challenging Peter's will and she derived some satisfaction from the circumstance that because Peter's will was valid Evanwood was hers to dispose of as she wished. 17 It is the plaintiffs' case that Laura intended that Evanwood be shared among her five children but that Andrew could remain in possession of Evanwood and ultimately become the owner of it conditionally upon him paying one-fifth of the value of Evanwood as at 7 September 1996 to each of his siblings on or before 7 September 2000. Andrew alleges he was not part of any agreement to this effect. However I have come to the conclusion that he was aware of the terms of Laura's will made in October 1996 in which, as will be seen, she left Evanwood to Andrew on certain conditions. Accordingly I reject Andrew's evidence that he was unaware of the terms of his mother's will. 18 In October 1996 and after being advised she would inherit Evanwood Laura made a new will. Andrew and Adam were her executors. The will was prepared by her solicitor Mr Friedlieb and, except for one minor matter, it accorded with the instruction given to him on 23 October 1996 (page 14 of Exhibit A). The will provided: "I give devise and bequeath my farming property known as Evanwood together with all plant, equipment and stock associated with the said property to my son Andrew Grant Evans subject to him paying an amount equal to one-fifth (1/5th) of the value of such property including plant, equipment and stock to each of my other children Susan Heather Calderbank, Timothy Martin Evans, Peter James Evans and Adam Lewis Evans. Such value is to be determined by a licensed valuer appointed by my executors and such valuation is to be valued as at 7 September 1996. I direct that such monies are to be paid within four years of the date of my death and are not to incur interest". It is accepted by all parties to the litigation that the words "my death" where appearing in the last sentence should read "Peter's death". That does not entirely accord with the solicitor's note made on 23 October 1996 which was admitted into evidence. However as I find it was Laura's intention at the time she made her will that Andrew should receive Evanwood on her death subject to him paying an amount equal to one-fifth of the value of the property as at the date of Peter's death to be paid within four years of that date. 19 The plaintiffs' case is that the provision made by Laura in her will reflected the agreement all children (including Andrew) had come to with Laura and that, so far as Laura was concerned, the provision in her will would have ended any challenge to the validity of Peter's will. (Later, as will be seen, the transfer of Evanwood to Andrew and Dianne did not include the transfer of stock, plant and equipment. These items became part of the partnership between Laura on the one hand and Andrew and Dianne on the other entered into in the middle of 1997). 20 On 20 March 1997 Laura, as vendor, entered into a contract of sale of Evanwood to Andrew and Dianne as purchasers. The purchase price was originally assigned was $1. Later it was changed to $541,975 after Mr Friedlieb, who acted for all parties, said he was directed to the capital gains tax implication in the future if the land was acquired for $1. 21 Two days before the signing of the contract Laura executed a document making a gift of Evanwood to Andrew and Dianne and on 20 March 1997 Andrew and Dianne executed document accepting the gift. 22 Laura asserts and Andrew denies that on or about 5 March 1997 at a meeting at which Andrew's accountant Darrel Watson was present, she made it clear that the gift to Andrew and Dianne was conditional upon them paying one-fifth of the value of Evanwood as at September 1996 on or before September 2000. 23 It was submitted by the plaintiffs that properly understood Evanwood is held on trust and that Evanwood should be sold and the price distributed to Laura's five children in equal shares. That conclusion derives, so it is said, either from the nature of the trust or because, properly understood, there was an agreement between Laura and all her children to that effect and that Andrew and Dianne's repudiation of the contract disentitles them from relying on the terms referred to above viz that Andrew and Dianne would be allowed to remain in occupation of Evanwood and get the benefit of income generated by it provided that by 7 September 2000 each of Andrew's other siblings had been paid their one-fifth share. 24 In the alternative the plaintiffs submit that Andrew and Dianne in March 1997 took Evanwood on trust subject to conditions to be found in Laura's October 1996 will with the consequence that each of the plaintiffs other than Laura should receive from Andrew and Dianne one-fifth of the value of Evanwood as at 7 September 1996 and that interest is payable on that amount after 7 September 2000 and to date. 25 On behalf of the defendants Mr Colefax submits there was no agreement as asserted by Laura and, as I have said, his clients are under no obligation in equity or in law to account to Laura's other children. He concedes, however, that if Laura's and her children's version of events is to be accepted then a constructive trust would have been established with the consequence that by 7 September 2000 Andrew should have paid his siblings one-fifth of the value of Evanwood as at 7 September 1996 and thereafter interest on that amount of money. 26 Thus it is the plaintiffs' claim that Laura, on becoming aware she was to become the legal owner of Evanwood by operation of her late husband's will made known to all her children, including Andrew, that Andrew could remain in occupation of Evanwood and that Evanwood would eventually be his but that he could earn money by the use of the land to allow him to pay out his other siblings by September 2000, his obligation being to pay them each one-fifth of the valuation of Evanwood as at 7 September 1996. Laura said she transferred Evanwood to Andrew and Dianne by way of a gift and she did so in order to qualify for the pension which, she understood, she would not be entitled to receive while she remained the owner of Evanwood or for a period of five years after disposal. She claims she made all this plain to Andrew and he well understood that the gift to him of Evanwood was subject to the conditions referred to above. 27 Andrew, on the other hand, maintains that he was given Evanwood with no conditions attached. He denies that he was aware of Laura's October will and that he was unaware of what he described in his affidavit as the "process" which led to the gift being made to him in March 1997 – although the statement in his affidavit was qualified in his oral evidence. 28 He attributes to Laura a malicious motive for claiming in evidence that she made a gift of Evanwood subject to the conditions referred to above. He alleges his mother was so angered by the behaviour of her children (except for Andrew) in the days just prior to Peter's death and the days afterwards that she resolved to punish them. It was Andrew's case that of all the children he was the only one who had the decency to refrain from attempting to carve up Peter's estate while he remained alive and unconscious. He alleges that Laura was further angered by suggestions by his siblings that proceedings could be taken to upset Peter's will and that, in any event, she had received her fair entitlement from Peter's estate in 1987 when she received $400,000 from the sale of the Tumut Hotel. In order to punish them she pretended to her children (other than Andrew) that they would have a share in Evanwood. He alleges the will was a sham and executed by Laura for the purpose of deceiving her children and causing them to believe they would share in Evanwood when she had privately resolved they would not. Later and after she had transferred Evanwood to Andrew (which according to the scenario painted by Andrew, was intended before she made her will in October 1996) she and Andrew fell out over the partnership they had entered into. To punish Andrew she then maintained that her will made in October 1996 was not a sham and that Andrew took Evanwood in 1997 subject to the conditions stated in that will. 29 I have not lost sight of the fact that what is to be determined in these proceedings is whether the transfer of Evanwood in March 1997 was subject to the conditions claimed by Laura. As I have said Andrew claims he had no knowledge of his mother's will in October 1996 and that nothing she said or did led him to the conclusion that he was receiving Evanwood otherwise than as a gift with no conditions attached. 30 I asked Mr Colefax why, if Andrew's version of his mother's conduct was correct she did not tell her other children that they had what they deserved and that she had given the property to Andrew. Mr Colefax surmised that she was perhaps worried that they might have pursued their claim to upset Peter's will. But that really does not explain why, if Andrew's version of events is correct she did not tell them after twelve months had elapsed because on her understanding the will could not have been challenged after that time. 31 A great deal of evidence was given in the proceedings concerning conversations said to have taken place during the period Peter lay unconscious in hospital and in the two or three weeks after his death. It is clear that the disposition of Peter's estate appeared to be uppermost in the mind of all children including Andrew who, as I have already mentioned, was living on Evanwood at the time his father had the stroke. I accept that Laura was dismayed by her children's conduct and somewhat triumphant when she learnt that she (and not them) would control the destiny of Evanwood. Bearing in mind that all the other children were aware of the arrangement proposed by Laura it beggars belief that Andrew was not aware of it. Accordingly I reject his evidence that he was unaware of the terms of Laura's will until this litigation commenced. 32 But as I have said this does not conclude the matter because the disposition of Evanwood by Laura did not take place until March 1997. Laura has given evidence that she wished to accelerate the transfer of Evanwood to Andrew (but still on the conditions set out in her will) because she understood she would not qualify for the pension until five years after she had disposed of her property. Although his evidence was somewhat qualified I understand Andrew to deny any knowledge of Laura's motive. He asserts that the disposition to Andrew and his wife was merely the next step taken in the punishment of his other siblings. 33 All members of the family have given evidence. All children, except Andrew, have given evidence of conversations and events which, if accepted, are consistent with their version of events and not Andrew's viz that Evanwood was given to Andrew and Dianne subject to the obligations set out in Laura's will. In fact only Adam became aware, and then by accident, that Andrew and Dianne were the owners of Evanwood. Adam became aware of it from council records in the latter part of 1997. He remonstrated with his mother but did not do anything else about it because, and I accept his evidence, he believed that Andrew would pay his siblings their one-fifth share by September 2000. I also record that I accept Adam's evidence that he told Andrew he would buy Vitonga from him for $300,000 in order that Andrew would have the funds necessary to pay Andrew's other siblings. 34 After March 1997 and prior to the dispute becoming the subject of litigation there were discussions between Andrew and his siblings which have been denied by Andrew but which I accept as having taken place. For example Peter gave evidence that in September 1998 and he visited Andrew and Andrew acknowledged to him his gratitude that he, Timothy, with the others, were prepared to wait until 2000 to be paid out. Timothy has also given evidence that in 1998 when he wished to purchase a caravan park in Tumut he telephoned Andrew and asked whether he could take his share then and there and that he was prepared to take $100,000 but Andrew had said "it doesn't suit me to pay you right now". These events and conversations took place at a time when Andrew, on his version of events knew, or believed he was, the owner of Evanwood without any obligations at all. Andrew denies these conversations took place and I record I do not accept his evidence. 35 Laura has given evidence that in February 1997 she told Andrew that if she waited until the year 2000 to transfer the property to him she would have to wait for a further seven years before she could get the pension and that she would put the property in his name trusting that he would pay the others out as previously agreed. She alleges Andrew said: "That's all right Mum, I'll do the right thing in the year 2000 and I'll pay everyone out". 36 Laura has referred to a meeting with Andrew and Dianne and Darrel Watson their accountant on 5 March 1997. Mr Friedlieb was also at that meeting. Laura has said that during a period when Mr Friedlieb was out of the room but in the presence of Darrel Watson she told Mr Watson and Andrew and Dianne that her other children had to be paid their equal share in the year 2000. She said Mr Watson then told her that Andrew would need to pay them "$20,000 or $30,000" and that he, Mr Watson, did not know how Andrew could meet even that commitment. Laura said that she then said: "The agreement is already made and they're entitled to equal shares. Andrew is going to sell Vitonga to help meet the payment". 37 Laura has alleged that Mr Watson claimed that Andrew was entitled to something because he had worked there for 20 years and, she says, Mr Watson did some calculations justifying his statement that the "children are only worth $20,000 to $30,000". Laura said she said in plain words "That's not right, they are entitled to their equal share in the year 2000." 38 Laura said she did not take the matter any further because she did not agree that her late husband had not paid Andrew for work done and, in fact, that she and her ex husband had worked on Andrew's farm. She said she relied on the fact that it was known to all her children Andrew had an obligation to pay his brothers and sister out in four years time. She gave evidence that after she left the office she said "What was all that about? I thought you would have told Darrel what is going to happen." She said Andrew put his arm around her and said "Don't worry about it Mum Darrel thinks you've got to have a bigger property these days to survive but we've made our plans." 39 Laura was cross-examined about the conversation referred to above. It was emphatically denied by Andrew and Dianne. It was put to Laura that she should have been more explicit in the reference she made in the agreement in the course of discussing the matter with Mr Watson. 40 Mr Watson swore an affidavit which was filed and read in the proceedings on behalf of Andrew and Dianne. It was read in Court. Later I was told he would not make himself available for cross-examination and Mr Colefax, for Andrew and Dianne, then sought to withdraw the affidavit and asked me to treat it as not having been read. Mr Powell did not oppose this course but made it plain that he would be commenting on the failure of Mr Watson to give evidence. 41 What was said at this meeting was significant, because if Laura's version of the events is accepted, it could hardly be disputed by Andrew and Dianne that they were receiving Evanwood on conditions that they pay Andrew's siblings one-fifth share in Evanwood valued as at September 1996 on or before September 2000. 42 In evidence Andrew has said that Mr Friedlieb was present throughout. Mr Friedlieb in his affidavit said that he did not recall any conversation of the type sworn to by Laura. However it is to be remembered that Laura said the conversation took place when Mr Friedlieb was out of the room but in the presence of Mr Watson. 43 A question arises therefore as to what inferences are available from the absence of Mr Watson and the fact that the plaintiffs did not seek to cross-examine Mr Friedlieb and the defendants did not call Mr Friedlieb to assert, if it was the fact, that there was a period during the course of the meeting when he was absent from it. 44 In my opinion I am entitled to infer that had Mr Watson been called he would not have advanced the case sought to be made out by the defendants - that case being the refutation by the defendants of the assertions made by Laura. So far as Mr Friedlieb is concerned I draw no inference other than acceptance of his evidence that he was not present when the conversation took place. Mr Colefax, however, has submitted that I should draw an inference adverse to Laura's case because Mr Friedlieb was not called for cross-examination. I raised with Mr Colefax that if he wished to maintain the assertion that Mr Friedlieb was at the meeting throughout he could have called Mr Friedlieb. He submitted that he was precluded from doing so by operation of legal professional privilege. It seems to me that this submission must be rejected. By the time all the affidavits had been read there could be no suggestion of any confidentiality remaining that would justify a claim for legal professional privilege. 45 There are two other pieces of evidence which lead me to the conclusion that Andrew not only knew of the contents of his mother's will but also was aware of the conditions attached to the gift of Evanwood. The first is that on 11 November 1996 Adam received a valuation from Mr Wood, valuer that Evanwood was valued at $541,975, the stock a little under $120,00 and plant and equipment $45,000. I find on the probabilities that this valuation was undertaken for the purpose of establishing a valuation of Evanwood on 7 September 1996 for the purpose of determining the entitlements of Laura's children pursuant to her will. If I understand Andrew's evidence correctly he does not dispute that this valuation was undertaken. He says, however, that he believed it was for the purpose of obtaining a grant of probate of Peter's will. Neither Adam nor Andrew was an executor under Peter's will. Laura was the executor. I have come to the conclusion that the valuation was undertaken with Andrew's knowledge for the purpose of fixing as at 2000 what the value of the land was in September 1996. 46 The plaintiffs also rely upon a policy of insurance taken out by Andrew on his life for $400,000 in April 1997. Laura has said she required Andrew to take out the insurance policy to ensure that if he died before discharging his obligations to his siblings the fund would be available for that purpose. To the insurance agent who caused the policy to issue Andrew said that the policy was for "estate debt responsibilities". Andrew has said that by these words he was referring to his father's estate. When he was asked why he felt he should insure his life to cover a possible debt owing by his father's estate he said that his father had guaranteed a loan he had taken out over Vitonga. I think the probability is that, as Laura has said, the policy was taken out to ensure that if Andrew died before he had discharged his obligations there would be a fund available for distribution among his siblings. 47 I have already referred to the circumstance that Mr Darrel Watson swore an affidavit which was withdrawn. The plaintiffs have tendered a note in Mr Watson's handwriting concerning a meeting held in March 1998 at which Mr Watson, Andrew and Dianne were present. The note reads: "Discussed the moral or ethical debit owing by Andrew to his three brothers and sister of property being passed by Laura to Andrew and Dianne at no cost. This was done because Andrew, (1), worked with Peter for a number of years for which he received little payment, (2), as Laura received the property under Peter's will she would never receive a pension unless gifted the asset. As Andrew was working with Peter and since Peter's death the property could pass to Andrew and Dianne exempt from stamp duty, (3), Andrew and Dianne are to "keep" Laura for five years until pension is available. Andrew had four brothers but one brother is to receive a share of the estate of an uncle. It was always understood by Peter he would not be entitled to any share of Peter's estate - this was a "family agreement". It was discussed with Andrew and Dianne the following arrangement: Land $500,000 Stock $120,000 The sum total becomes $620,000 Less foregone wages owing to Andrew over a period of approximately ten years – say - $150,000 The sum total becomes $470,000 If shared equally between three brothers and Andrew would need to gift to the other three brothers $470,000 x three quarters (sister???) $352,500 Less value of stock introduced to partnership by Laura ($120,000) Cost of "keeping" Laura for five years say five x $16,000 ($80,000) Total net value of moral debt owing by Andrew $152,500" 48 It is true as has been submitted by the defendants that the document refers to the "moral or ethical debt". However it also refers to what was said to be a legal obligation of Peter to Andrew and a legal obligation by Andrew to Laura for five years. That is, it refers to wages which he claimed he was legally entitled to but which had not been paid and the legal obligation to support his mother. If, as I am asked to accept, Andrew was not a party to his mother's intentions and believed he was the absolute owner of Evanwood it is somewhat surprising that he would have included the value of the property as part of the "moral or ethical" obligations he may have owed to his mother and his other siblings. It is perhaps a small point but it is not inconsistent with the plaintiffs' account of things. 49 In preferring the plaintiffs' version of events over that of the defendants I have not overlooked the criticisms made by Mr Colefax on behalf of the defendants of the plaintiffs' case. Laura's evidence has been subject to the criticism that if, as she alleges, she trusted all her children why did she not tell them she had conveyed Evanwood to Andrew. Secondly it is submitted that if, as she asserts, the conditions attached to the conveyance of Evanwood were the same as those to be found in her earlier will why was there not some written record of this and an acknowledgement by Andrew. Her explanation for not telling her children what she had done was, in effect, that she wished to avoid further trouble. I have already referred to the fact that there was a suggestion that her ex husband's will might be challenged and she said "I just thought that everything would flow along and in the year 2000 everything would happen and that would be that". Bearing in mind what she thought was the unseemly conduct of her children just before Peter died I accept that explanation. 50 A stronger attack is that she failed to take steps to ensure that Andrew could not in the future dispute that he took Evanwood subject to the obligation to pay out his siblings in about three and a half years time. The matter was not the subject of any evidence by Mr Friedlieb. As I have said he swore an affidavit which was filed on behalf of Andrew and Dianne in which he said he was present at the meeting of 5 March and that nothing was said concerning the alleged agreement. As I have said I do not accept the submission made by Mr Colefax that he could not have asked Mr Friedlieb questions concerning this matter because to do so may have invoked a claim of legal professional privilege. On any view of the matter any legal professional privilege owed by Mr Friedlieb to either Laura or Andrew had been waived by the affidavits filed. Bearing in mind that Laura had made a will in October it is perhaps somewhat surprising that Mr Friedlieb did not draw her attention to the arrangement she had previously come to with her children and which was made known to him bearing in mind that he drafted her will pursuant to a conference that was recorded in Exhibit B at page 14. 51 However her failure to take the step that ordinarily one would have expected her to have taken does not conclude the case against her. That circumstance has to be weighed in the balance with all the other circumstances in this case. 52 After Adam became aware that Evanwood was owned by Andrew and Dianne in 1997 he confronted his mother. She assured him that Andrew would honour his promise. He did not tell his other siblings what he had discovered. He said that he had hoped, in effect, that by the time they found out about it Andrew would have discharged his obligations. Bearing in mind that he was proposing to buy Vitonga from Andrew for the sum of $300,000 that was not, in my opinion, an unreasonable attitude to take. Adam appeared to be the one person in the family who was trying to keep the family together. Accordingly I do not find that Adam's failure to disclose what he discovered in 1997 to his siblings as having any probative value so far as the defendants' case is concerned. 53 I have refrained as far as possible from making findings concerning the credit of witnesses. It is clear that one side or another is not telling the truth and I have concluded that the plaintiffs' case is to be preferred over that of the defendants. But I have to mention in passing that other than the motivation ascribed to Laura by Andrew (and which I have rejected) there was no attack on the credit of the other children who gave evidence other than that it was put to them that what they were saying was not true. There was an attack on Andrew's credit over and above the Court being asked to accept the plaintiffs' case in preference to his. Andrew has taken proceedings in the District Court at Wagga Wagga claiming the sum of $166,000 from his mother. In evidence before me he claimed that although he says she owes him some money the claim of $166,000 was "without foundation" and when asked whether he would persist with the claim in the light of that answer he said "I have not made up my mind yet your Honour. It was put there for a counter claim with my mother". I said I had asked him the question and given him the opportunity to make any further explanation if he wished to because I had no doubt a submission would be made concerning his credit arising out of the answers he gave. The matter was taken no further. Conclusions 54 Mr Colefax has conceded that if the plaintiffs' case is accepted a constructive trust would have been established. In my opinion the plaintiffs' case has been established. I do not think Andrew and Dianne held Evanwood in trust for Laura's five children. I have concluded that it was Laura's intention that Andrew should have Evanwood but that he was under an obligation to pay to each of his siblings on or before 7 September 2000 a one-fifth value of Evanwood as at 7 September 1996. Orders 55 Accordingly I declare that the first and second-named defendants Andrew and Dianne Evans took the property Evanwood subject to an obligation to pay to Susan Calderbank, Timothy Evans, Peter Evans and Adam Evans each one-fifth of the value of Evanwood as at 7 September 1996 on or before 7 September 2000. Conformably with the declaration referred to above I order that the defendants Andrew and Dianne Evans pay to Susan Calderbank, Timothy Evans, Peter Evans and Adam Evans each one quarter of the sum of $575,616 made up as follows: Four-fifths of the value of Evanwood as at 7 September 1996 ($541,975) - $433,580 Interest on the sum of $433,580 from 7 September 2000 to 21 March 2004 calculated by reference to the interest rates handed to me in submissions being - $142,036 Total $575,616 The defendants' to pay the plaintiffs' costs of the proceedings. ********** Last Modified: 03/26/2004 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. 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