Palinkas v Palinkas [2010] NSWSC 923

New South Wales Supreme Court

CITATION : Palinkas v Palinkas [2010] NSWSC 923

HEARING DATE(S) : 12 July 2010

JUDGMENT DATE : 23 August 2010

JURISDICTION : Equity Division

JUDGMENT OF : Bergin CJ in Eq

DECISION : Motion dismissed with costs.

CATCHWORDS : JUDGMENT AND ORDERS – application to set aside orders made in absence of defendant consequent upon orders after a trial – where no appeal in respect of orders made after trial – whether orders irregular where equipment subject to mortgage and financiers not joined – whether discretion should be re-exercised

LEGISLATION CITED : Uniform Civil Procedure Rules 2005 r 36.16(2)(b)

Baumgartner v Baumgartner (1987) 164 CLR 137 Grimshaw v Dunbar (1953) 1 QB 408 John Alexander's Clubs Pty Ltd v White City Tennis Club Ltd [2010] HCA 19 CASES CITED : Morris v Morris [1982] 1 NSWLR 61 Muschinski v Dodds (1985) 160 CLR 583 Palinkas v Palinkas [2009] NSWSC 92 Taylor v Taylor (1979) 143 CLR 1

Rudi Palinkas (First Plaintiff / Respondent) PARTIES : Gizella Palinkas (Second Plaintiff / Respondent) Rudolph Charles Palinkas (Defendant / Applicant)

FILE NUMBER(S) : SC 2008/278489

COUNSEL : SK Hill (Plaintiffs / Respondents) C Wood / T Catanzariti (Defendant / Applicant)

SOLICITORS : Jade Solicitors (Plaintiffs / Respondents) Watson McNamara & Watt Solicitors (Defendant / Applicant)

- 20 - IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

BERGIN CJ in EQ

23 AUGUST 2010

2008/278489 RUDI PALINKAS & ANOR v RUDOLPH CHARLES PALINKAS JUDGMENT 1 This application by the defendant, Rudolph Charles Palinkas, to set aside certain orders made by Macready AsJ on 30 October 2009 (the 30 October orders) was heard on 12 July 2010 when Mr C Wood, of counsel, leading Ms T Catanzariti, of counsel, appeared for the defendant/applicant and Ms SK Hill, of counsel, appeared for the respondents/plaintiffs. The proceedings 2 The plaintiffs, Rudi Palinkas and his wife Gizella Palinkas, sued the defendant, their son, in proceedings that were heard and determined by Austin J in February 2009: Palinkas v Palinkas [2009] NSWSC 92. In those proceedings the plaintiffs sought, inter alia, an order that the defendant's property at Boggabri known as Uplands was charged with specific amounts of money that the plaintiffs had contributed to the defendant. 3 The plaintiffs filed a Further Amended Statement of Claim (FASOC) during the trial before Austin J. They had previously abandoned a number of claims that had been made in the Statement of Claim including a claim for a declaration that any farm chattels purchased by the defendant using the plaintiffs' money were held by him on trust for the plaintiffs. The plaintiffs had also abandoned a claim for any ancillary order allowing the plaintiffs to sell any such chattels that were still in the defendant's control and possession and to retain any net proceeds from that sale. 4 The FASOC included claims that the plaintiffs and the defendant entered into a number of agreements pursuant to which the plaintiffs advanced money to the defendant in return for which the plaintiffs were entitled to live in a Cottage on Uplands. The first agreement was alleged to have been entered into in August 2001 pursuant to which the plaintiffs advanced $10,000 "for the purpose of renovating the Cottage" on Uplands. It was alleged that a further agreement was entered into in October 2001 (confirmed in writing in February 2002) pursuant to which the plaintiffs advanced $210,000 to the defendant "for the purpose of reducing the defendant's liabilities in relation to Uplands and making improvements to Uplands". It was also alleged that in February 2002 an agreement was entered into varying the October 2001 agreement and providing that if the plaintiffs decided to vacate the Cottage the defendant was to acquire other suitable accommodation for them. The FASOC also included the following: Constructive Trust Arising From Joint Endeavour 75 Further or in the alternative, the plaintiffs and the defendant, on or about August 2001, entered into a joint endeavour the purposes of which were: i. To allow the defendant to reduce his liabilities in respect of Uplands and make improvements to Uplands, ii. To allow the plaintiffs to reside in the Cottage for life. 76 Pursuant to the said joint endeavour: i. The plaintiffs contributed their resources to improvement of Uplands and the cottage as pleaded in paragraph 66 and paragraph 74 (i). ii The plaintiffs also made significant non-financial contributions to the improvement of Uplands. 77 On or about August 2006 the relationship between the parties broke down and thus the sub-stratum of the said joint endeavour was removed. 78 The defendant was and remains the sole registered proprietor of Uplands. 79 In the circumstances it would be unconscionable for the defendant to deny that the plaintiffs hold a beneficial interest in Uplands. 80 In the premises the defendant holds his interest in Uplands subject to a charge or lien in favour of the plaintiffs in respect of their contributions.