New South Wales Supreme Court CITATION : Reganam Pty Ltd v Crossing [2009] NSWSC 1401 HEARING DATE(S) : 16, 17 & 18 September 2009 (Written submissions closed 14 October 2009.) JUDGMENT DATE : 15 December 2009 JUDGMENT OF : Smart AJ DECISION : Summons dismissed. CATCHWORDS : Application to set aside two transactions under s 37A Conveyancing Act 1919 - Whether intent on part of disponor or agent (wife) to defraud (including defeat, delay or hinder) creditors - Claim of resulting trust by wife to property not established by payments made. LEGISLATION CITED : Conveyancing Act 1919 CATEGORY : Principal judgment Calverley v Green (1984) 155 CLR 242 Chen v Marcolongo [2009] NSWCA 326 Crisp v Mullings 1976 EG 730 CASES CITED : Lumbers v W Cook Builders Pty Limited (2008) 232 CLR 635 Silvera v Savic (1999) 46 NSWLR 124 The Official Trustee in Bankruptcy v Alvaro (1996) 138 ALR 341 Wentworth v Rogers [2004] NSWCA 430 Williams v Lloyd [1934] HCA 1; 50 CLR 341 Reganam Pty Ltd (Plaintiff) PARTIES : Phillip Barclay Murray Crossing (First Defendant) Joanne Marion Crossing (Second Defendant) Torcullin Pty Ltd (Third Defendant) FILE NUMBER(S) : SC 4772/2008 JM White (Plaintiff) COUNSEL : JP Redmond (First Defendant) S Epstein SC / A Douglas-Baker (Second & Third Defendants) Cole & Butler (Plaintiff) SOLICITORS : The Law Company (First Defendant) PMF Legal (Second & Third Defendants) IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION Smart AJ Tuesday 15 December 2009 4772/08 Reganam Pty Ltd v Phillip Barclay Murray Crossing, Joanne Marion Crossing and Torcullin Pty Ltd JUDGMENT 1 By the close of the hearing the plaintiff was seeking to set aside: a) an equitable (unregistered) mortgage granted in December 2007 by the first defendant, Phillip Murray Crossing, in favour of the second defendant, his wife, Joanne Marion Crossing, over a residential property ("the residential property"); b) the transfer of moneys in favour of the third defendant, Torcullin Pty Limited, being moneys lent by the National Australia Bank Limited (NAB) on the security of the residential property to Torcullin Pty Ltd, such security being in the name of Phillip Murray Crossing. 2 In its Amended Summons the plaintiff sought an order that Torcullin Pty Limited repay to Phillip Murray Crossing the moneys Torcullin Pty Limited had received from NAB. 3 The plaintiff claimed that both the mortgage and the transfer of moneys were made with intent to defraud creditors and were void. The plaintiff relied upon s 37A of the Conveyancing Act 1919 (NSW). Background 4 In 1979 Phillip and Joanne Crossing purchased a farm known as Derryackie at Walcha. They ran the farm together. In 1980 she moved to Armidale and trained as an accountant. Since 1984 she worked as an accountant in a large regional centre and lived there. 5 Mr Phillip Crossing was a farmer and until about 1999, when it was sold, he lived on Derryackie. 6 In September 1990 Mrs Crossing bought the residential property but it was registered in the name of Mr Crossing. She arranged the purchase. The transfer of 5 October 1990 shows that the consideration was $110,000.00. The property was the subject of a mortgage to Westpac, of about $85,000.00. 7 From about 1979 to about 1999 Mr Crossing lived at Derryackie and farmed that property. He did stay at the residential property from time to time between late 1990 and 1999. Since he sold Derryackie in 1999 Mr Crossing has lived at the residential property. He had leased Glenholme from Reganam Pty Limited before he moved off Derryackie. He farmed Glenholme from 1999 to 2004. It is a short drive from the residential property. 8 Mrs Crossing has lived continuously at the residential property since completing the purchase in about October 1990. It has been her home. Mrs Crossing paid the whole of the deposit on the purchase of this home, the expenses of the purchase and the difference between the purchase price and the amount advanced by Westpac and all mortgage instalments from October 1990 to May 2009. She expected this to continue. She had paid all rates, insurance premiums and maintenance expenses from October 1990 to May 2009. 9 About 1 July 1991 she became a partner in an accountancy practice. She borrowed the further amount of about $450,000.00 from NAB to purchase her share. About 1 July 1992 that accountancy practice merged with another practice. Mrs Crossing became an equity partner in the merged firm. 10 On 30 June 1992 the Crossing Family Trust ("CF Trust") was established with Crossing Investments Pty Ltd ("CI") as the trustee. The CF Trust was established by Mrs Crossing for the purpose of acquiring her interest in the merged accountancy practice through that Trust. Both she and Mr Crossing were contingent beneficiaries under the Trust. 11 When CI was incorporated the directors appointed were Mr and Mrs Crossing. Each held one share. 12 A mortgage was executed about 31 August 1992 in favour of NAB by Mr Crossing over the residential property. This was part of the security offered for her borrowings and those of CI on behalf of the CF Trust. The mortgage to the Bank was not expressed to be a guarantee mortgage. At the same time the earlier mortgage to Westpac was discharged. On 30 December 1993 Mr Crossing executed a mortgage in favour of Westpac Banking Corporation over the residential property. It was expressed to be subject to the Mortgage to NAB. 13 In 1996 Mrs Crossing left the practice she was with and practised under her own name as a chartered accountant. From that time until about 24 June 2008 she continued to carry on the business of an accountant through the CF Trust. 14 On 24 January 1997 CI created a fixed and floating charge in favour of NAB. The liability was summarised thus: "All the moneys which are now or may from time to time be owing or remain unpaid in any manner or on any account whatsoever to the chargee by the Company or the Company as Trustee of a Deed of Trust/ Settlement dated 30/6/92 for the Crossing Family Trust." 15 In about mid 2004 Mrs Crossing became aware that a dispute had arisen between her husband and Reganam. 16 About 27 July 2005 Mr and Mrs Crossing obtained from NAB a fixed-rate home loan of $136,000.00. The terms and conditions of this facility were accepted by CI in its capacity as trustee for the CF Trust. It guaranteed payment of this amount. 17 On 27 July 2005 the Arbitrator in proceedings between Reganam and Mr Crossing published an award. 18 During 2006 and 2007 further loans were obtained from NAB and amounts were paid on account of legal costs to the solicitors acting for Mr Crossing. 19 Reganam's challenge to the arbitrator's award and its application to remove the arbitrator were last heard on 26 July 2006. On 8 June 2007 a Judge of this Court delivered judgment in which he set aside the award of the arbitrator of 27 July 2005, removed the arbitrator and ordered Mr Crossing to pay Reganam's costs of those proceedings. Those costs, including those of the costs assessment, amounted to $59,718.92. 20 For the year ended 30 June 2007 Mrs Crossing received an income distribution of $80,355.00 from the CF Trust. The accountancy practice she conducted had earned those moneys. Mr Crossing did not receive any distribution. She thought that it might be four years since he had received a distribution but she was not sure. She agreed that one of the considerations in deciding whether or not to make a distribution was preventing creditors getting their hands on trust assets. 21 About 30 July 2007 Mr Crossing transferred his share in CI to Mrs Crossing and resigned as a director of CI. CI amended its constitution to become a one-director company. 22 Mrs Crossing agreed that the decision to make a distribution of income from the CF Trust was entirely hers. 23 She became aware in about 1995 that she could make CI a one-director company. She said she did not get around to doing so until late July 2007. She had no reason to be concerned prior to July 2007 about her husband being a director because he did what she asked. At T90, lines 26 – 29, she agreed that it was the handing down of the judgment on 8 June 2007 which really motivated her to remove her husband as a director of CI. She also said it had been on her mind for some time. She advanced two other reasons. She did not want difficulties with the Tax Agents Board on her next renewal and questions being asked on the next quality review by the Institute of Chartered Accountants. The major reason why she took action was because of the judgment handed down on 8 June 2007 ordering her husband to pay Reganam's costs. She realised that they would be substantial. Her other reasons were subsidiary. 24 Reganam no longer sought to set aside the share transfer but relied on the evidence as pointing to the real reasons for her actions, namely, that she and her husband were taking a course designed to avoid paying Reganam's costs as ordered. She was under no liability to pay those costs. 25 In about early August 2007 Mrs Crossing arranged for a local valuer to make an assessment of the current market value of the residential property. As at 2 August 2007 the valuer considered that a current market value of the property would be $210,000.00. Mrs Crossing said that in about late 2007 she had heard that Simon Kelleher, the man behind Reganam, had been telling people that he was going to have her husband made bankrupt. She knew that this was in relation to the costs order in Reganam's favour. She thought she heard about the bankruptcy proposal probably later than August 2007, but she could not really remember. 26 She said that she wanted security for the money she was paying for her husband's legal fees. She obtained a valuation assessment to assess the equity available in the property to provide security for the legal fees which she was paying. She insisted that it was her desire to obtain security for the legal fees of her husband which she was paying rather than hearing of Mr Kelleher's proposal to bankrupt her husband that led to her seeking and obtaining security for the sums which she was paying. That evidence was correct. 27 Mrs Crossing agreed that she probably held the strong view that Reganam would enforce its entitlement under the costs order. 28 She said that she was not greatly worried that Mr Kelleher would try to make her husband bankrupt but she was concerned that she was paying all her husband's legal fees and she wondered if she would ever get the money back (T 113). She wanted to get back the moneys paid out in legal costs. She acknowledged that by late 2007 she thought that the equity she had in the residential property was potentially vulnerable in her husband's hands and that it was apparent to her there was a very real and present danger to that property. She rejected the proposition that it was the very real and present danger to the residential property occasioned by Reganam's foreshadowed attempt to enforce the judgment that was her motivation for seeking a mortgage of that property. She said the main reason was that she wanted to be able to get back the money she was paying out in legal fees. I thought her evidence was correct. In her affidavit of 20 May 2009 Mrs Crossing referred to the costs she has already paid and is going to incur in defending these proceedings, the Arbitration proceedings, the Award Appeal proceedings, the costs proceedings and the Arbitration Proceedings when they resume. These costs will be substantial. There are two imperfect guides. Firstly, these are Reganam's costs of the Award Appeal Proceedings (setting aside the Award) and the costs of the cost assessment amounting in total to nearly $60,000.00. Secondly, the solicitor for Mr Crossing has produced copies of bills (Exhibit 2/3D – 4) extending over the period 12 September 2005 to 19 November 2007 amounting to over $110,000.00. There is no evidence that these have been paid. There is evidence that, prior to December 2007, Mrs Crossing had paid or caused to be paid nearly $41,000.00 for his costs and nearly $11,000.00 since then. The bills are often addressed to Mr Phillip Crossing C/- Jo Crossing at her office address. Mrs Crossing had good reason to want the costs payments she had made and was going to make secured. 29 Mr Crossing was far more worried about being made bankrupt than was his wife about him being made bankrupt. This did not trouble her to any appreciable extent. She was concerned about not getting back the money she had paid out, and would pay out, on account of his legal fees. There were some unsatisfactory features of her evidence. In paragraph 191 of her affidavit of 20 May 2009 Mrs Crossing said that, with the consent of her husband and pursuant to her rights under the written agreement (of 12 December 2007), she took out a caveat over the residential property: "to cover the deposit, all of the mortgage repayments that I have made on my home … upkeep, maintenance insurance and his costs that I had already paid or was and am going to incur in defending … these proceedings, Arbitration proceedings, the Award Appeal Proceedings, the Costs Proceedings and the Arbitration Proceedings when they resume." The written agreement of 12 December 2007 states the purpose of the loan as litigation funding. The mortgage of 7 December 2007 contained a broad definition of "Secured Moneys". In none of the documents she had prepared by her solicitors was it recited that she had any interest as beneficial owner in that property. I would not have expected this. 30 I find and accept that in December 2007 she wanted to get back the money she had paid out, and would pay out, for her husband's legal costs and to this end she required a measure of security. 31 A series of documents were executed about December 2007. By mortgage bearing dated 7 December 2007 for $100,000.00 executed by Mr Crossing in favour of his wife over the residential property he mortgaged all his estate and interest therein. This mortgage was not registered. Clause 8 of the Mortgage states, "This mortgage secures moneys owing by the Mortgagor to the Mortgagee under a Letter of Offer dated 20 November 2007". See also clause 10 of the Mortgage describing that letter as collateral security. No letter of offer of that date was produced and this reference appears to be an error. 32 By letter bearing date 12 December 2007 addressed to her husband, Mrs Crossing offered to make available a secured loan facility of $100,000.00 by way of second mortgage over the residential property. Mr Crossing accepted the terms of the letter by signing a copy of it. That involved accepting the attached Facility Terms which Mr Crossing also signed. 33 On 18 December 2007 Mrs Crossing signed a Caveat. She was described as Equitable Mortgagee under "Unregistered mortgage 7/12/2007". That Caveat was stamped and registered. 34 While Mrs Crossing's motive in having the December 2007 documents executed was to secure the moneys she had advanced and was going to advance on account of her husband's legal costs, she would have been aware that they would make it more difficult for Reganam to enforce the costs order it had obtained. 35 I do not find that Mrs Crossing had an intent or desire to defraud the creditors of her husband. Nor do I find that such an intent or desire was one of the reasons that caused her to have her husband enter into the mortgage of December 2007. She wanted to protect her own financial interests. She was the moving party in procuring the execution of the mortgage and the acknowledgment of the facility. 36 Section 37A does not affect an alienation which amounts to merely a preference of one creditor over another: Wentworth v Rogers [2004] NSWCA 430 at [63], and cases there cited. 37 As Allsop P pointed out in Chen v Marcolongo [2009] NSWCA 326 at [13], the High Court decision in Cannane made clear that the disponor's interest was critical. I do not think that Mr Crossing, despite his strong antipathy towards Mr Kelleher of Reganam, had an intent to defraud creditors. That is not a matter to which he addressed his mind. He left all financial matters to his wife. He treated the moneys his wife had advanced and was likely to advance towards his costs as a loan. I have referred at length to his wife's intent and actions in view of Mr Crossing leaving all financial matters to her. Having seen and heard them both I was satisfied that he had done so and that on financial matters she called the shots. I turn now to the events that occurred next in point of time. They do not relate to the December 2007 mortgage. 38 In December 2007 and subsequently events occurred in relation to Mrs Crossing's business affairs and her practice as a chartered accountant. In about June/ July 2007, a few months before she turned 60, Mrs Crossing had a preliminary discussion with an employee and accountant about the latter investing in the practice being conducted by CI, which it was planned to corporatise. That was unresolved as at December 2007. 39 The practice had since July 1999 been carried on in premises in the business district of a large regional centre. A number of separate businesses had formed a lessee company which had a lease of the premises and owned the telephone system and some furniture and fittings. In December 2007 some of the participants withdrew from the arrangement. That left some unoccupied areas. About 15 January 2008 one of the owners contacted Mrs Crossing and wanted to know if the lease was going to be renewed. 40 In about February 2008 Mrs Crossing was told by S of the decision to sell the financial planning business which S conducted. S had been troubled by ill health. Negotiations ensued involving Mrs Crossing, her employee and S. Agreement in principle was reached in about April 2008 and the various parties instructed their solicitors. In broad terms it was envisaged that the employee would buy into the practice conducted by CI on behalf of the CF Trust, that Mrs Crossing and the employee would buy into the Financial Planning Business with S retaining an interest in that business. The parties and their solicitors then decided how the in principle agreement would be implemented. 41 Joreki Pty Limited, the subsequent purchaser of the Financial Planning Business, was registered on 15 April 2008. The directors were Mrs Crossing, the employee and S. Ultimately, S's company held two ordinary fully paid shares, the employee's company held three ordinary fully paid shares and Torcullin Pty Ltd, the successor of CI, held five ordinary fully-paid shares. I have left out the details of the earlier transactions. 42 By Deed dated 24 June 2008 Mrs Crossing, pursuant to clause 3.01 of the CF Trust Deed and her designation and powers as Protector, replaced CI as the trustee of the CF Trust with Torcullin Pty Ltd. Mrs Crossing is the sole director and shareholder of Torcullin Pty Ltd. 43 On 26 June 2008 Torcullin Pty Limited, as trustee of the CF Trust, agreed to sell the accounting practice to a new company, NWBC Investments Pty Ltd. That agreement for sale contained these additional terms and conditions: "The price shall be satisfied by way of allotment of the totality of the equity and voting shareholding in the Purchaser in favour of the Vendor at and in consequence of completion. Collateral to this agreement and conditional upon completion of same is the contemporaneous completion of the sale of thirty (30) percent of the equity in the Purchaser in favour of [a company] in trust for the R Family Trust wherein as consideration for such transfer, after the initial allotment referred to in #2 above, the transferee shall pay in favour of the transferor in cash on completion the sum of [sum omitted] …" 44 These provisions were implemented. The directors of NWBC Investments Pty Ltd were Mrs Crossing and the employee. The shareholdings in that company reflect the broad agreement that the CF Trust should retain seventy per cent of the assets formerly held by that Trust and that the [R] Family Trust [of the employee] should hold thirty per cent of those assets. 45 By agreement of 25 June 2008, S's company agreed to sell the Financial Planning Practice to Joreki Pty Limited. The substantial sale price was to be paid mostly in cash with the balance to be satisfied by the issue to S's company of a shareholding in Joreki equivalent to a 20% interest in the issued capital of Joreki. This has been carried into effect. I will not summarise the many detailed provisions contained in the agreement. 46 On 25 June 2008 a shareholders' agreement effective from 1 July 2008 was made between the companies of the three participants, those participants and Joreki. This detailed agreement deals in certain respects with the management of Joreki and regulates future dealings with shares in Joreki. 47 It is apparent that from February 2008 to June 2008 a major reconstruction of the practice owned by the CF Trust was in train, along with an expansion of the business activities of Mrs Crossing and the CF Trust via its trustee. 48 While settlement of the agreement for the sale of the practice owned by the CF Trust was due to take place on 1 July 2008, it took place on 3 July 2008. NAB had a fixed and floating charge over the assets and undertaking of CI. It then took a fixed and floating charge over the assets and undertaking of Torcullin. 49 Mrs Crossing said that the CF Trust used the proceeds from the sale of the part of the Practice of the CF Trust to purchase its share in the Financial Planning Business. The balance of the purchase price that Torcullin had to contribute to buy its shares in Joreki was borrowed from NAB and paid on settlement, that is, to help pay for the purchase of 55% of the Financial Planning Business. Mrs Crossing pointed out that the shares that have been allotted to Torcullin in Joreki total 50% and not 55% as provided in the contract of sale. She stated that this would be rectified. Dealings with National Australia Bank (NAB) 50 By letter of 3 April 2008 to "the Directors, Crossing Investments Pty Limited", NAB advised that the business overdraft facility limit would be changed to $80,000.00. Apparently, it had been $50,000.00. 51 NAB required a Guarantee and Indemnity for $80,000.00 to be given by Mr Crossing and Mrs Crossing supported by "Registered Mortgage over … [the residential property]… given by Phillip Barclay Murray Crossing". 52 The acknowledgement of the Guarantee and Indemnity was signed by Mrs Crossing as Director/ Secretary of CI and by Mrs Crossing and Mr Crossing personally. 53 On 1 July 2008 NAB wrote to "Mrs JM Crossing, Torcullin Pty Ltd" advising that the application of Torcullin as trustee for the CF Trust for the following facilities had been approved: Limit NAB Business Options Combination Loan $185.000.00 NAB Business Overdraft $120,000.00 $305,000.00 54 The business overdraft limit of $120,000.00 continued until 30 September 2008. Thereafter the limit was $60,000.00. That limit was to be cancelled no later than 31 December 2008. NAB required these securities: "Fixed and Floating Charge over the whole of the assets of Torcullin Pty Ltd as trustee for Crossing Family Trust including goodwill and uncalled capital and called but unpaid capital together with relative insurance policy assigned to [NAB]. Guarantee and Indemnity for $305,000.00 given by Joanne Marion Crossing, Phillip Barclay Crossing, NWBC Investments Pty Ltd … & Joreki Pty Ltd … supported by: Registered Mortgage over [the residential property] … Fixed and Floating Charge over the whole of the assets of NWBC Investments Pty Ltd … including goodwill and uncalled capital and called but unpaid capital together with relative insurance policy assigned to [NAB]. Fixed and Floating Charge over the whole of the assets of Joreki Pty Ltd … including goodwill and uncalled capital and called but unpaid capital together with relative insurance policy assigned to [NAB]." 55 The fixed and floating charge as to NWBC Investments had the potential to affect Mrs Crossing and the employee and as to Joreki had the potential to affect these two participants and S. The Bank's approach to security was all embracing. The date and terms of the letter and much of the security required suggest that NAB was primarily concerned with providing funds for the acquisition of the Financial Planning Business and the conduct of the accounting practice. 56 I have also noted the requirement of a registered mortgage over the residential property which stood in the name of Mr Crossing. He did not participate in the accounting practice or in the financial planning business. 57 On 1 July 2008 both Mr and Mrs Crossing signed the Guarantee and Indemnity. 58 By separate letters of 3 July 2008 the Bank advised Mr and Mrs Crossing that they had approved the following facility: "Mrs Joanne Marion Crossing Mr Phillip Barclay Crossing Facility: Base Variable Rate Home Loan Facility Limit: $160,000.00" 59 In respect of this facility, Mr Crossing acknowledged in writing that the earlier Mortgage of 31 August 1992 to NAB was a continuing security and that he accepted the extension of that security. 60 Mrs Crossing agreed that she told the officers at NAB that the change of the trustee of the CF Trust was being done for legal reasons. Her solicitor suggested that she should have a clean company as the trustee. Her solicitor was acting for her husband in relation to the costs assessment. She agreed that her husband's liability for legal costs was one of the matters mentioned in the legal advice received as a reason for changing the identity of the trustee. The advice was communicated verbally. In my opinion once Mr Crossing became liable to pay a substantial amount of money pursuant to a Court order and he did not pay it, or have the funds to pay it, prudence required that he cease to be a director of CI so as to avoid queries being raised by supervisory bodies on their next renewals or reviews. The appointment of a new trustee was a further precaution to avoid adverse enquiries and adverse comment. Neither the Trust nor CI was under any obligation to meet the costs ordered to be paid by Mr Crossing. 61 It was put to Mrs Crossing that the main reason she wanted to distance her husband from the affairs of the trust was knowledge of Reganam enforcing the costs order against him. She said initially that it was one of many reasons. When pressed, she said it may have been the main reason but there were others. Having Mr Crossing resign from CI would not result in any moneys being payable by CI or the CF Trust to Reganam. 62 From February 2008 Mrs Crossing was principally occupied with her accountancy practice, including negotiating the purchase of the Financial Planning Business earlier mentioned, the sale of part of the practice she conducted and negotiating the way in which the accountancy practice and the financial planning business would be organised and conducted. The employee attended to some matters. Premises had to be secured and organised for the accountancy practice and the financial planning business. Mrs Crossing was also involved in raising the finance necessary to purchase the financial planning business. Financial accommodation had to be obtained from the Bank. Its terms as to the business overdraft meant that, over the six months from 1 July 2008, the new accountancy practice and financial planning business had to function effectively. S was paid a large salary. There needed to be a substantial income from the practice and the business. 63 The financial arrangements made between the three participants and the assignment of areas of responsibility were quite complex and so were the documents giving effect to them. Negotiating these arrangements and the documents would have taken considerable time. 64 The Bank had for many years held security over the residential property, both for the home loan and in respect of Mrs Crossing's business borrowings in connection with the purchase of her share in the accountancy business and when she practised on her own account. At the date she entered into various security documents in early July 2008, she was indebted to the Bank but required further accommodation for the CF Trust to purchase a share in the Financial Planning Business. Reganam correspondence 65 By separate letters dated 1 August 2008, respectively addressed to Mr and Mrs Crossing, Reganam's solicitors asserted that the transfer of Mr Crossing's share to his wife in CI, effective 9 August 2007, and the unregistered mortgage of 7 December 2007 referred to in the caveat lodged on the title of the residential property constituted an alienation of property. A copy of the unregistered mortgage and a copy of any document pursuant to which the transfer was effected were sought. 66 By letter of 11 August 2008 the solicitors acting for Mr and Mrs Crossing replied: "We are instructed Mr Crossing shall attend to payment of the costs as determined in full. Funds to enable such payment should be available shortly. With respect to your letter addressed to Mrs Crossing, as you are aware, there is no basis for your client to seek the requests and demands contained in such correspondence. Mrs Crossing is not a party to any proceedings involving your client. Accordingly, the information and undertakings sought shall not be supplied by Mrs Crossing. With respect to your letter addressed to Mr Crossing, we respond as follows: 1. The 'Share' transaction occurred in the normal course of the re-structure of the accountancy practice conducted by Mrs Crossing. 2. The 'Property' transaction shall not prevent the satisfaction of the costs determination by our client, which, as we have noted above, shall be paid shortly." 67 The costs in question have still not been paid. Mr Crossing was a farmer. He does not keep records and has a poor memory. He had no interest, in or aptitude for, financial matters. He left those to his wife. It was she who told him that he was liable to pay Reganam $60,000.00 for costs for the earlier Supreme Court proceedings. His wife has been paying his costs. In early August 2008 he could not have afforded to pay any sum approaching $60,000.00. 68 Mr Crossing could not remember giving his solicitor instructions to write what is stated in the letter of 11 August 2008, but said he may have done so. 69 Mr Crossing said he could have told his solicitors that he would attend to payment of a $60,000.00 costs liability because his wife pays his costs. He did not recall whether his wife was with him when he saw his solicitor in August 2008. She did not think that she attended with him in conference. She believed that she had had a separate conference with the solicitor. 70 Neither when she was obtaining an equitable mortgage over the residential property nor after receiving the letter of 1 August 2008 did Mrs Crossing, it seems, instruct her solicitors that she was the beneficial owner of that property. That claim was made subsequently when she contended, correctly, that she had provided the balance of the purchase price and made all the payments under the mortgage and in respect of that property. That did not give her a claim to beneficial ownership of the residential property. Mrs Crossing's claims were not mentioned in any of the letters of her solicitor written in August 2008, nor were the basic facts. In both instances years had passed since the property had been placed in her husband's name. Some mortgage history 71 Mr Crossing said that he had no idea that he borrowed $85,000.00 to purchase the residential property. He did not remember which Bank advanced the mortgage moneys. He agreed that the reason for taking out the mortgage was to purchase a home. It was not an investment loan. He accepted that he signed the 1990 mortgage to Westpac. While Mr Crossing was liable to make payments under the Westpac mortgage, he never made any payments. He did not have the money. His wife attended to making the payments on the loan and on the property. She attended to all their financial affairs. 72 Mr Crossing had no recollection of signing the acceptance of the letter bearing date 12 December 2007 from his wife as to a loan facility of $100,000.00 for litigation funding. He accepted that he had signed it. He said, "I sign what my wife puts in front of me; she is my accountant". He did this unquestioningly. He could not remember signing the mortgage of 7 December 2007, although he accepted that he had done so. 73 Mr Crossing denied that in 2007 he granted a mortgage to his wife to assist keep the proceeds of the residential property out of Reganam's hands. Mr Crossing said he had no option but to sign any document that his wife puts in front of him. Mr Crossing said that if he had the money, which he did not, he would pay Reganam's costs but he would begrudge doing so. I thought that the evidence given by Mr Crossing was probably correct. 74 Mr Crossing did not recognise the letter of 3 April 2008 from NAB changing the facility limit to $80,000.00. He agreed that he had signed the Guarantor's Acknowledgement. His wife requested that he sign it. He said that when he signed the document he did not know that the effect of it was to increase the size of the commitment to the Bank and the mortgage on the residential property. 75 Mr Crossing did not recognise the NAB Guarantee and Indemnity of 1 July 2008, although he readily accepted that he had signed it. He did not remember signing it. That records an obligation to pay NAB all amounts which Torcullin Pty Ltd, as trustee for the CF Trust, owed up to $305,000.00 plus interest, bank fees, economic costs plus certain other specified amounts owing. He did not realise, in signing that Guarantee and Indemnity, that he was guaranteeing the liabilities of Torcullin Pty Ltd, or that it would have the effect of increasing the extent of the mortgage on the residential property. 76 Mr Crossing did not remember receiving the letter of 3 July 2008 from NAB addressed to him advising NAB had approved of a facility comprising Base Variable Rate Home Loan with a Facility Limit of $160,000.00. Again, Mr Crossing readily accepted that he had signed as borrower and the confirmation of the extension of the security. He did not remember signing the documents. He believed that he signed them when his wife put them in front of him. Mr Crossing's Assets and Liabilities 77 In his affidavit of 26 September 2008, Mr Crossing stated that he had the following assets: [Residential property] $210,000.00 Funds in bank account 477.15 138.04 Sundry motor vehicles totalling 6,000.00 Household contents (50% share with wife) 10,000.00 Interest as beneficiary under CF Trust 0.00 226,608.19 Mr Crossing disclosed the following liabilities: Home loan to NAB jointly with wife secured by first mortgage over [the residential property] $160,000.00 Personal loan from wife secured by equitable mortgage over [the residential property] 40,000.00 Third party mortgage over [the residential property] and personal guarantee with wife in favour of NAB to secure business loan and overdraft facility to Torcullin Pty Ltd (50% share) 305,000.00 NAB visa credit card 22,000.00 Mr Crossing showed a nil income and stated that he did not receive any distribution from the CF Trust in the years ending 30 June 2007 and 30 June 2008. He was a contingent beneficiary. 78 Mr Crossing understood from what his wife had told him that the residential property was worth about $210,000.00. The property was in his name. 79 In his affidavit of 19 May 2009 Mr Crossing said that, when the residential property was purchased in 1990, his wife said to him, "I am going to be an accountant. It is better that the house is bought in your name." He worked and lived at Derryackie until it was sold in 1999. He said that he had been financially dependent on his wife from the time he left Derryackie in 1999 and mostly dependent on her income as an accountant. He has had one casual job with a modest income since 2004. His wife has paid all of the legal costs of the arbitration proceedings and the appeal. She is continuing to pay his legal costs. Mr Crossing's Credibility 80 There were aspects of the evidence of Mr Crossing which were the subject of much criticism and I have considered these. I was asked to reject his evidence. I decline to do so. Having seen and heard Mr Crossing give evidence, I accepted that (a) he has an unusually poor memory; (b) he did not remember or understand the documents which he signed, or their effect; (c) he did not remember conferences held with his solicitor and instructions he gave them; and (d) he had no interest in the CF Trust and CI – they were the province of his wife. He did what his wife requested. She put documents in front of him and asked him to sign them. If she gave him an explanation of the documents she was asking him to sign he did not retain it. He had no interest in financial matters and left everything relating to the management of financial affairs and matters to her as the accountant. He was interested in farming matters. Although the residential property was in his name and he was the registered proprietor, he regarded it as her property despite his affidavit because he acknowledged that she had paid everything in respect of it. His affidavit reflects that he was the legal owner of the property. He has done some minor maintenance work around the property from time to time. 81 Mr Crossing's memory, command of detail and understanding were poor. He had spent his working life running cattle and occasionally some sheep on a 1,500-acre property at Walcha. When he sold Derryackie in 1999 he received a relatively small net sum. He claimed, probably correctly, that he had then devoted all his resources to working Glenholme. He struck me as not being financially astute or knowledgeable. He never had the money to purchase the residential property or meet any financial liabilities in relation to it. They were not his concern. He left those to his wife. There was no explanation why it was better to put the residential property in his name. In September 1990 Mrs Crossing had been working as an accountant for six years. She was taken into the partnership in 1991. When she referred to being an accountant she was probably referring to being a principal of an accountancy firm. She probably knew what was likely to happen. Mr Crossing agreed to his wife's suggestion. He left matters like this to her. 82 When Mr Crossing swore his affidavit of 26 September 2008 as to his assets he did not refer to the residential property being the property of his wife. Instead, he showed it as one of his assets. As that property was registered in his name that was sufficient for him and he did not think that more should have been stated. He did not go into what had taken place. Given Mr Crossing's personal characteristics, that does not surprise me. 83 Reganam submitted that the Court should find that Mr Crossing embarked on a course of falsely denying all recollection of the relevant events except to the extent that he perceived it may assist his case to recall them. I do not so find. This submission does not allow for Mr Crossing's personality, his manifest limitations and both his lack of interest in, and his lack of understanding and knowledge of, the documents he signed and of financial matters. In financial matters he was subservient to and depended upon his wife. I do not think he is capable of retaining what he is told except in the most general terms. 84 I think that this evidence is correct: a) that Mr Crossing lived and worked on Derryackie from 1979 – 1999 running cattle and, on occasions, some sheep, [at one stage he erroneously stated that in about 1990 he sold Derryackie and moved into the residential property]; b) that the residential property was put in Mr Crossing's name at his wife's request; c) that since Mr Crossing moved in 1999 to the residential property to live with his wife he has been financially dependent on her. Amongst other things, he has relied on her financial support and left the management of financial matters to her; d) he was unable to meet his legal costs and other related expenses in relation to the arbitration proceedings and the earlier Supreme Court proceedings; and e) he has not had an income for some years and his wife pays his accounts. He had no resources and no money. December 2007 Documents 85 While there is evidence of Mrs Crossing meeting her husband's legal costs and other related expenses, the Court depended upon the evidence of Mr and Mrs Crossing that the moneys were advanced by way of loan and upon them signing the documents of December 2007. Mr and Mrs Crossing relied on the description in the facility letter and annexure as lender and borrower and the provisions in the unregistered mortgage. Reganam submitted that there was no reason to think that any payments made by Mrs Crossing on account of her husband's legal expenses were other than gifts. That submission does not allow sufficiently for the approach and character of Mrs Crossing. 86 In clause 2 of the annexure to the unregistered mortgage bearing date 7 December 2007: "'Secured Moneys' means all moneys now owing and/ or payable or hereafter to become owing and/ or payable to the Mortgagee by the Mortgagor on any account of the Mortgagor whatsoever … and whether arising under or out of any Agreement, Mortgage or security or in any other manner whatsoever." There is an argument to the effect that if payments made by Mrs Crossing prior to December 2007 were gifts this provision does not assist Mr and Mrs Crossing. In my opinion, the unregistered mortgage indicates the financial relationship between them and picks up prior loans. 87 The plaintiff submitted that there was no evidence of any agreement between Mr and Mrs Crossing for the loan of moneys to be used for the payment of legal expenses at any time before December 2007 and that the agreement prepared by the solicitor for Mr and Mrs Crossing in December 2007 does not record any past financial accommodation and was prospective in operation. The plaintiff pointed out that the accepted letter of 12 December 2007 (the loan facility) was prepared and executed six months after the costs order against Mr Crossing and several months after Mrs Crossing had formed the view that the equity in property should be protected and that Mrs Crossing had a well-founded fear that Reganam would pursue her husband into bankruptcy. The Court was asked to infer that the motivation of both Mr and Mrs Crossing in having the facility prepared and executed and securing it by equitable mortgage was to defeat, hinder or delay Reganam. I do not draw the inference requested. 88 As might be expected, Mr Crossing told his wife of the arbitration proceedings instituted against him and subsequently the earlier proceedings in this Court. He had no money with which to pay the costs of those proceedings. She did. I infer that Mr Crossing sought his wife's assistance to pay his costs. She was experienced in dealing with financial matters. She advanced moneys to meet his legal expenses. She did not make a gift but responded to the assistance he sought. He knew that he was to repay the moneys advanced and anticipated being able to do so by winning the arbitration proceedings. Whether she might forgive the debts arising if he lost is another matter. His conduct in executing the equitable mortgage and the facility in December 2007 constituted an acknowledgment by him that, as to the moneys advanced by her on account of his legal coasts, the relationship was that of lender and borrower. 89 I do not conclude that Mrs Crossing's payment of her husband's legal expenses was a gift in favour of him. The resulting trust claim 90 The plaintiff submitted that the claim of Mrs Crossing under a resulting trust to the entirety of the beneficial interest in the residential property should fail. 91 Reliance was placed by the plaintiff upon the following: a) Mr Crossing in his affidavit of 26 September 2008 claimed the entirety of the value of the residential property as his. He said the property was in his name. He understood that he possessed the value of that property (T 53, lines 29 – 46). When further pressed, he understood that the value of the residential property was his asset, Mr Crossing responded, "It was in my name". He gave this evidence (T 54, lines 12 – 16): "Q: But you understood that the value was yours in every respect? A: No, it was mortgaged. Q: But that is your only qualification. A: Oh, well, that's what I understand." His understanding was that the property was mortgaged. No more should be read into his answer. b) Between August and December 2007 Mrs Crossing made no claim to any beneficial interest other than a claim to protect the repayment of legal expenses. c) In August 2008 when her solicitor replied to the letters of Reganam's solicitors no reference was made to the interest Mrs Crossing now asserts. She regarded herself as the real owner of the residential property in August 2008. d) In cross-examination (T 120) Mrs Crossing said that she did not think her ownership (beneficial ownership?) was relevant. She added that she had always paid everything in relation to it. She gave this evidence: "Q: You did not regard yourself as holding a substantial interest in that property in August 2008 did you? A: Well the property was always in my husband's name but I have paid everything for it and that is not unusual." 92 Mrs Crossing had paid everything for the residential property. Her husband did what she asked and consented to the property being put in his name as she asked. When from time to time advances were sought from the bank in connection with the accounting practice conducted by her and owned by the CF Trust, Mr Crossing signed a mortgage over the residential property as requested. 93 In Calverley v Green (1984) 155 CLR 242 Gibbs CJ at 246 pointed out that where a person purchases property in the name of another the question whether the other person, who provided none of the purchase money, acquires a beneficial interest in the property depends on the intention of the purchaser. In the absence of a presumption of advancement it is presumed that the purchaser did not intend the other person to take beneficially. If that presumption is not rebutted a resulting trust arises in favour of the purchaser. The other Justices took a similar view. Both presumptions (advancement and resulting trust) may be rebutted by evidence of the actual intention of the purchaser (Gibbs CJ at 251). 94 At 257 Mason and Brennan JJ stated: "It is understandable but erroneous to regard the payment of mortgage instalments as the payment of the purchase price of a home. The purchase price is what is paid in order to acquire the property; the mortgage instalments are paid to the lender from whom the money to pay some or all of the purchase price is borrowed." 95 They expressed at 258 agreement with the view of the English Court of Appeal in Crisp v Mullings 1976 EG 730 at 733: "The situation … is that the defendant does not establish that he alone provided the purchase price, any more than he would have, had the whole price been provided by a joint mortgage; and the resulting trust of the whole is therefore not established." 96 Reganam relied on this statement of principle in Calverley v Green at 263 of Mason and Brennan JJ: "Mortgage payments may quantify the parties' interests under a resulting trust of a property acquired as a mortgage-free investment, but they would rarely quantify the interests of parties under a resulting trust of a house property acquired as a home to live in." 97 The facts in the present case, taken in combination, are unusual. The money for the difference between the purchase price and mortgage was provided by Mrs Crossing. On one view it was about $25,000.00. Mrs Crossing thought that it may have been less. As at 1990 Mr Crossing lived at Derryackie and continued to live there until Derryackie was sold in 1999. Mr Crossing did stay at the residential property between 1990 and 1999 on occasions and lived there permanently once he sold Derryackie. While Mr Crossing was liable under the covenants of the mortgage, it was always envisaged that his wife would make the mortgage repayments, and meet the rates, maintenance and upkeep expenses, and she did so. The liability of Mr Crossing under the covenants of the mortgage was never expected to materialise in him making any payment. This applies to the Westpac mortgage of 1990, the NAB mortgage of 1992 and subsequent mortgages. Mr Crossing's financial circumstances could be described as straitened. 98 Notwithstanding that the facts taken in combination are unusual, the statements of principle in Calverley v Green at 263 and the express adoption of the passage in Crisp v Mullings quoted earlier preclude the claim of Mrs Crossing of a resulting trust. A resulting trust of the whole of the residential property has not been established. See also The Official Trustee in Bankruptcy v Alvaro (1996) 138 ALR 341 at 358. The Torcullin advance 99 It was accepted that Mrs Crossing obtained a 55% interest on the sale of S's company and thus a corresponding financial responsibility. The employee's company acquired a 30% interest in the new vehicle which acquired ownership of Mrs Crossing's practice. NAB provided the funding mentioned. One consequence was that the residential property became more heavily encumbered. 100 It was pointed out that on 3 April 2008 NAB offered CI an increase in the Business Overdraft Facility from $50,000.00 to $80,000.00 secured against the residential property. Mr Crossing signed the guarantor acknowledgement. He denied that when he signed that document he did so knowing that the effect of it was to increase the size of the mortgage commitment on the residential property. In most circumstances I would not have accepted that as a truthful answer. I think however that, having regard to the lack of interest of Mr Crossing in financial matters, his leaving of all financial matters to his wife, his personality (including his attitudes) and his practice of signing documents as requested by his wife, his answer denying that he signed the guarantor acknowledgement knowing that the effect of it was to increase the size of the mortgage commitment on the residential property was probably truthful and correct. Mr Crossing was severely embarrassed by having to depend on his wife for financial support. He felt that he had no option but to do as she requested. He did not question, investigate or appreciate what he was asked to sign. He did not remember what he was asked to sign. 101 The plaintiff relied on Mr Crossing agreeing on about 1 July 2008 to guarantee further NAB facilities for Torcullin to the extent of about $305,000.00 (see Exhibit A, pages 582, 585, 588) by his signing of the Guarantee and Indemnity of 1 July 2008, and the documents, probably of 3 July 2008 (Exhibit A, especially at pages 603 and 605), by which the facility limit for the Variable Rate Home Loan was $160,000.00. Each of Mrs Crossing and Mr Crossing was shown as "customer" and "borrower". 102 In view of what was taking place between and on behalf of the three participants, Mr Crossing's role and position on 1 and 3 July 2008 would have been subsidiary. I conclude that, apart from a broad outline, Mr Crossing knew and appreciated relatively little about his wife's business affairs. He was not involved in her business affairs or interested in the details of them. Mr Crossing stated that he did not remember signing the document of 1 July 2008. Nor did he recognise it. He said that he did not realise that he was guaranteeing to pay and meet the liabilities of Torcullin Pty Ltd. He said he did not realise that it would have the result of increasing the extent of the mortgage on the residential property. 103 Mr Crossing said that he did not recall receiving the letter of 3 July 2008 addressed to him. He did not recall signing the facility (offering a variable home loan facility with a limit of $160,000.00) or the facility. 104 One effect of what was done by the documents of about 3 April 2008, about 1 July 2008 and of probably about 3 July 2008 was to more onerously encumber the residential property with further debt for the benefit of Torcullin, a company in which Mr Crossing had no interest. It was submitted that, ultimately, there was a transfer of value away from Mr Crossing's assets and into his wife's company and that this was another effect of the finance transaction in which Torcullin engaged. 105 The plaintiff further submitted that Torcullin extracted money, and in a fairly direct way, using Mr Crossing's asset, for nil consideration; that this both enriched Torcullin, at Mr Crossing's expense, and submerged entirely the secured asset from the prospect of Reganam's attack. The plaintiff also submitted that, even if Mrs Crossing was the person primarily responsible for the process of alienating value from Mr Crossing's assets into her own hands, this was no barrier to Reganam's claim. 106 While there was a transfer of value, Mr Crossing did not appreciate that this was occurring. He regarded the property as available for his wife. 107 Torcullin was a trustee company and the trustee of the CF Trust of which Mr Crossing was a contingent beneficiary. Further, the CF Trust was the beneficial owner of the accountancy practice of his wife, a portion of which was sold. Mr Crossing depended on his wife financially. This was not a conventional situation. 108 Mr Crossing's answers in his evidence as to the documents of 1 and 3 July 2008 are hard to accept. Usually, they would not be accepted as truthful. However, for the reasons mentioned when he signed the facility or documents of 3 April 2008 (increasing the business overdraft from $50,000.00 to $80,000.00), I thought that the answers Mr Crossing gave in relation to the documents of 1 July 2008 and probably of about 3 July 2008 were probably truthful and correct. 109 The plaintiff submitted that at least one of Mr Crossing's motivations in signing the documents of 1 July 2008 and those probably of about 3 July 2008 was to further encumber the residential property to defeat or delay any attempt by Reganam to enforce its judgment. I do not think that this is correct. Mr Crossing probably gave no consideration to these matters prior to, or when or about, the time he signed these documents. He signed the documents which his wife put before him without appreciating their effect. This also applies to the documents of about 3 April 2008. 110 It was submitted that it should be inferred that one of Mrs Crossing's motivations in entering into the documents of 3 April 2008, 1 and 3 July 2008 was to defeat or delay any attempt by Reganam to enforce its judgment for costs. I do not think this was one of Mrs Crossing's motivations or intentions. As previously indicated, once she learnt in February 2008 that there was an opportunity to acquire the Financial Planning Business, Mrs Crossing concentrated on the acquisition of that business and agreeing terms with the other participants. There was also the sale of a share in the accountancy practice. Mrs Crossing regarded the Financial Planning Business as a good one. There were substantial profits to be made. Mrs Crossing could see the virtue of S retaining an interest in the business and continuing to work in it, and was prepared to reorganise the execution of those tasks which S found burdensome. 111 As earlier stated, after agreement was reached in principle, attention was directed to the form the arrangements should take. Solicitors were consulted and companies were registered. Documents reflecting some relatively complex arrangements were prepared. Funds, as needed, were sought from the bank by Mrs Crossing. Settlement of the sale and purchase of the Financial Planning Business took place about 1 July 2008. On 2 July 2008 S's company received the proceeds of sale of that business. Settlement of the sale and purchase of an interest in the accountancy practice took place on 3 July 2008. It seems that documents were prepared by NAB on and between 1 and 3 July 2008. From June 2008, if not earlier, attention was focussed on implementing the intended changes. The businesses had to be shifted into moneymaking mode. S was taking holidays and the former employee was expecting the arrival of a third child in July 2008. Much rested on the shoulders of Mrs Crossing. The business overdraft facility had to be reduced significantly by the end of September 2008. It was not to continue past the end of December 2008. 112 In my opinion Mrs Crossing, in entering into each of the documents of 3 April 2008 and 1 and 3 July 2008, probably did not have as one of her motivations an intention to defeat or delay or hinder any attempt by Reganam to enforce its judgment for costs. 113 It was accepted that s 37A requires there to be an intent to defraud, but not that it be the sole or even the principal intent. I do not think that there was an intent to defraud creditors. In Chen v Marcolongo [2009] NSWCA 326 at [225] Young JA said: "The authorities also make it clear that intention to defraud need not be the only intention that a person has when making the alienation: Barton v Deputy Commissioner of Taxation of the Commonwealth of Australia [1974] HCA 43; 131 CLR 370 at 375. However, the intention to defraud creditors must be a prominent part of the intention of the debtor; see Williams v Lloyd [1934] HCA 1; 50 CLR 341." and at [288]: "The mere fact that a creditor or creditors generally may be by-passed is insufficient. One must focus on the actual intent of the disponor and ask whether there was a sufficient motivating factor in the transaction that creditors would be defrauded and by-passed." 114 I have considered both the intent of Mr Crossing and that of Mrs Crossing as he left financial matters to her and on such matters acted in accordance with her wishes. While Mr Crossing had a strong dislike of Mr Kelleher, a principal of Reganam, it did not extend to defrauding him. Mrs Crossing had no intent to defraud Reganam in relation to either the December 2007 mortgage or increasing the mortgage amount as to the residential property. Her husband had, at her request, signed mortgages over the residential property to assist with the financing of the accountancy practice she conducted and the affairs of the CF Trust. From February 2008 to 31 July 2008 Mrs Crossing had one intent, namely, to acquire the financial planning business and thereby increase the overall profitability of the businesses in which she was engaged. While Mrs Crossing struck me as financially astute and informed, I did not think that she intended to defeat, delay or hinder creditors of her husband. She was concerned to recover moneys advanced on behalf of his legal costs and, in 2008, to increase the scope and profitability of her business operations in accountancy and financial planning. Generally 115 In assessing the intent of both Mr Crossing and Mrs Crossing I have had regard to what they did, the documents signed and their evidence. She acted on legal advice that it would be best to have a new trustee of the CF Family Trust. The new trustee did not have her husband amongst its directors. That does not mean that he or she was intending to defraud his creditors. No assets were lost or jeopardised by her husband not being a director of the trustee of the CF Trust and Mrs Crossing being the sole director of the trustee. 116 I refer to the observations of Allsop P at [9], [17] and [18] of Chen. Allsop P followed the statement of Dixon J in Williams v Lloyd [1934] HCA 1; 50 CLR 341 at 372 that "a real intent to defraud or delay creditors must exist". At [17] Allsop P commented: "It is an actual intent to deprive creditors of their rights or the fruits of their rights." I do not think that either Mr Crossing or Mrs Crossing had such an intention. I have not overlooked the inferences that can be drawn from what they did and her appreciation of the effect of the earlier judgment of 8 June 2007 in this Court. The plaintiff placed substantial reliance upon the residential property being placed in Mr Crossing's name and him including that property as one of his assets in his affidavit of 26 September 2008. There is no reference in that affidavit to him holding the residential property for his wife or that she was the beneficial owner of that property. Amongst his liabilities he lists Third Party Mortgage over the residential property and personal guarantee with his wife in favour of NAB to secure Business Loan and Overdraft Facility to Torcullin Pty Ltd of $305,000.00. 117 It was not until his affidavit of May 2009 that Mr Crossing deposes to the payments made by his wife in respect of the residential property and states that she purchased the property. 118 In her List of Assets in paragraph 2 (not read) of her affidavit of 26 September 2008, but the subject of cross-examination, Mrs Crossing does not include a beneficial interest in the residential property. However, in her affidavit of 20 May 1999 she refers to the moneys she paid to acquire the home in 1990 and subsequently. 119 For many years from 1990 onwards it appeared that the residential property was that of the husband. It was not until May 2009 that her claim to a beneficial interest in the property was overtly made. In August 1992 the property was mortgaged to NAB. That mortgage is expressed to secure advances "to or for the mortgagor, Mr Crossing". It is not expressed to be a third party mortgage. NAB advanced moneys to Torcullin at the instance of Mrs Crossing to acquire a share in a financial planning business and to assist in the conduct of that business and the accountancy practice. From August 1992 moneys were being advanced by NAB partially secured on the residential property in respect of the accountancy practice owned by the CF Trust and conducted by Mrs Crossing and that continued over the years. While the Torcullin advance was in a larger amount, the pattern of NAB's requirements as to security continued with a mortgage over the residential property as part security. 120 With Mrs Crossing's and the CF Trust's ready access for security purposes to the residential property for borrowings in respect of the accountancy practice she conducted and Mr Crossing signing documents as requested by his wife to enable borrowings to proceed, and with her living in that home, any formal acknowledgement of any interest she had or claimed to have had in that property may well not have appeared necessary or desirable. 121 The plaintiff submitted that Mr Crossing's decision to mortgage the residential property for no consideration and for the benefit of Torcullin had been a transfer of value and hence an alienation of property. It was further submitted that because his decision to do so was preceded by a business transaction of Mrs Crossing that was no answer to the contention that Mr Crossing behaved with the relevant intent when he granted the mortgage. I do not think he had the relevant intent. Otherwise I do not disagree with the last mentioned submission. 122 The defendants relied on these statements in Lumbers v W Cook Builders Pty Limited (2008) 232 CLR 635 at [79]: "… payment of money, for and at the request of another, are archetypal cases in which it may be said that a person receives a 'benefit' at the 'expense' of another which the recipient 'accepts' and which it would be unconscionable for the recipient to retain without payment." and at [80]: "… the bare fact of conferral of the benefit or provision of the service does not suffice to establish an entitlement to recovery." These statements apply to a different situation (unjust enrichment) from that presently under consideration. Questions of Relief 123 The second and third defendants submitted, and the first defendant adopted their submission, that the claim that the borrowing by Torcullin from NAB was a fraud on the creditors of Mr Crossing was unaccompanied by an intelligible claim for relief or by the joinder of NAB, which was a necessary party. The plaintiff stated that it did not wish to sue the NAB or attack NAB's securities and, in particular, its mortgage over the residential property. The plaintiff's complaint was the use of that property as part of the security to support the loan of $305,000.00. The business letter of offer from NAB of 1 July 2008 shows Customer 1 as Torcullin Pty Ltd as trustee for CF Trust. 124 As to the "Torcullin Advance" claim, Reganam sought the re-transfer of value from Torcullin back to Mr Crossing in an amount sufficient to avoid the prejudice under which Reganam currently suffers. It was suggested that the amount should include the sum of $59,718.92 and an amount to cover the plaintiff's costs of these proceedings. 125 The plaintiff relied upon these observations of Hodgson CJ in Eq in Silvera v Savic (1999) 46 NSWLR 124 at [72]: "What s 37A says is that the 'alienation' is 'voidable'. In my opinion, when an application is made under s 37A to the Supreme Court, that Court can achieve the effect of avoiding the alienation by such measures as seem appropriate in the particular case." (Hodgson CJ in Eq gave an example.) I would respectfully agree with the opinion of Hodgson CJ in Eq. 126 In view of my findings as to the lack of intent the question of granting relief to the plaintiff does not arise. 127 The second and third defendants should bring in Short Minutes to give effect to this judgment. I will settle these and hear any argument as to costs on a date to be arranged. ********** 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. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.