Supreme Court New South Wales Medium Neutral Citation: Szeto v Situ [2017] NSWSC 1554 Hearing dates: 17,18,19 October 2017 Decision date: 20 November 2017 Jurisdiction: Equity Before: Emmett AJA Decision: 1. Direct the plaintiff to bring in short minutes of orders to give effect to the conclusions reached in the reasons of 20 November 2017 and for the further conduct of the proceedings, including the cross-claim. Catchwords: EQUITY – General principles – Equitable estates and interests – Nature of equitable interests and ownership – Beneficial ownership – Property purchased in the name of defendant alone – Whether Defendant paid whole of purchase price and mortgage, not plaintiff – Whether Plaintiff has no right or interest in property REAL PROPERTY – General principles – Ownership – Beneficial ownership Legislation Cited: Nil Cases Cited: Currie v Hamilton [1984] 1 NSWLR 687 Calverley v Green (1984) 155 CLR 242; [1984] HCA 81 RS & GH Thompson Pty Ltd v Leigh [2006] NSWSC 540 Green v Green (1989) 17 NSWLR 343 Texts Cited: Nil Category: Principal judgment Parties: Livy Szeto (Plaintiff/Cross Defendant) Liming Situ (Defendant/Cross Claimant) Representation: Counsel: Clive Evatt QC (Plaintiff/Cross Defendant) Paul Cutler (Defendant/Cross Claimant) Solicitors: Pope & Spinks (Plaintiff/Cross Defendant) Equiton Solicitors (Defendant/Cross Claimant) File Number(s): 2014/00285214 Judgment 1. These proceedings are concerned with one aspect of a dispute between a brother and sister in relation to the ownership of various parcels of real property. The defendant, Liming Situ (the Brother), became the registered proprietor of an estate in fee simple in a property situated in Henry Street, Carlton, New South Wales (the Carlton Property). The plaintiff, Livy Szeto (the Sister), claimed to be entitled to an undivided one-half share in the Carlton Property. However, the Brother claimed to be beneficially entitled to the whole of it. 2. The Sister commenced proceedings in the Equity Division seeking declaratory relief in relation to her asserted interest in the Carlton Property. On 24 May 2016, Lindsay J ordered that the proceedings be dismissed with costs. On 15 June 2017, the Court of Appeal allowed an appeal from the orders of Lindsay J and set those orders aside. The Court of Appeal ordered a re-trial before a judge nominated by the Chief Judge in Equity. I have now conducted a re-trial pursuant to the orders made by the Court of Appeal. 3. Both the Sister and Brother have limited command of English. Their evidence was given viva voce in Mandarin and interpreted by a sworn interpreter. Subject to one minor matter that was corrected, the parties accept that the interpretation by the interpreter into English was accurate. 4. There is disputation between the Brother and Sister as to the ownership of four separate parcels of real property, including the Carlton Property. The other properties are situated at Yerrick Street, Lakemba (the Lakemba Property), Hannam Street, Turrella (the Turrella Property) and Dowling Street, Arncliffe (the Arncliffe Property). The Sister is the registered proprietor of an estate in fee simple in respect of the Lakemba Property and the Arncliffe Property. The Sister and the Brother are the registered proprietors as tenants-in-common in equal shares of an estate in fee simple in respect of the Turrella Property. The disputes concerning the other three properties are presently not before me. However, it will be necessary to refer to them briefly. 5. The Carlton Property has now been sold by the Brother and the dispute presently before the Court now concerns entitlement to the proceeds of sale. For reasons that will appear below, the entitlements may depend upon the taking of accounts between the Brother and the Sister both in relation to the Carlton Property as well as in relation to the other properties. 6. By her amended summons, which was filed during the course of the hearing before me, the Sister relevantly claims declarations that: * the Carlton Property was purchased and thereafter owned by the Brother in trust for the Sister and the Brother in equal shares; and * the Brother holds the sale proceeds from the sale of the Carlton Property in trust for the Sister and the Brother in equal shares. The amended summons also seeks consequential relief and recognises that the ultimate distribution of the proceeds of sale of the Carlton Property will depend upon the taking of accounts between the Brother and the Sister. 1. The matter proceeded on pleadings. However, the pleadings leave a lot to be desired. The Sister's statement of claim filed on 31 October 2014 made allegations to the following effect: * The Brother and the Sister made a decision to purchase the Carlton Property together; * Before the purchase of the Carlton Property, the Brother and the Sister agreed that the Carlton Property would be registered under the Brother's name only, but that the Brother and the Sister would have equal shares in the Carlton Property and the Sister would make her contribution towards the purchase of the Carlton Property. 1. The Sister gave evidence of a conversation with the Brother prior to the purchase of the Carlton Property, although it is unclear whether the alleged conversation took place before or after the Carlton Property was identified. The Sister's evidence was that she said to the Brother that she had seen a property and wanted to buy it and would like to use "the money in [his] fan box". The "fan box" was identified by the Sister as being a broken electric fan where the Brother kept cash. It is unclear whether the Sister was suggesting that the Brother lend her the cash that he kept in the fan box. The Sister said that the Brother responded that he did not want to buy a property because he did not have enough money. He said that he wanted to carry on his business and his business was not very stable so he did not want to buy a property. 2. The Sister said that she said to the Brother: "I have some money, you have some money in the fan box, and we can also borrow some money and then we will repay all together." She said that he responded that he did not want to use the money in the fan box because he wanted to use it to go back to China and to marry. She also said that he told her that he wanted to put the money into his business and did not want to buy a property. According to the Sister, he said that he did not want to be a taxi driver anymore and wanted to use the money to run a business. 1. The Sister said that the Brother eventually agreed to use the money in the fan box and to borrow money together to buy the Carlton Property. She said that he said: "All right, you go to borrow the money and we buy the property together." 1. In his defence to the Sister's statement of claim, which was filed on 1 December 2014, the Brother asserted that there had been a discussion between them about purchasing a property in his sole name. In his oral evidence, he said that he and the Sister had a conversation at the Lakemba Property in about September 1997. When asked to recount the words said in the conversation, his response was as follows: "In September 1997 I would like to purchase a property, but because of my income at that time, I could not get a loan by myself. So I talked to my sister to see if she could help me to get a loan. She agree, but she said she was not going to make any mortgage repayment. I said the title of the property would be in my name only so I would pay all the associated costs. She agreed." 1. The Brother said that the Sister thereafter accompanied him to look for properties in the Rockdale and Carlton area. In cross-examination, he said that they spent about two to three hours a day for two weeks looking for houses. When asked in cross-examination why the Sister would spend that time helping him notwithstanding that, on his case, she was to have no interest in the property once identified, the Brother said that it was because she was his sister. 2. The Brother said that the two of them found the Carlton Property and that, when they chose it, he talked with the agent. That seems unlikely in circumstances where the Brother said that he had very little understanding of English. Indeed, as will appear below, the Brother said that it was the Sister who communicated with their solicitor, Mr A L Wunderlich, when they met with him, because the Brother could not understand what was being said by Mr Wunderlich. When asked whether there were any conversations about how the Carlton Property would be paid for, the Brother said that the Sister had experience of purchasing properties and she knew some mortgage brokers so he asked her to look into the matter after they had identified the Carlton Property. He agreed that the Sister arranged the finance because she had friends who were mortgage brokers. 3. On 18 September 1997, the Brother entered into a contract for the purchase of the Carlton Property for the sum of $260,000 (the Purchase Contract). The Purchase Contract provided for the payment of a deposit of $26,000. The Sister asserted in her statement of claim that she paid the deposit. However, at the commencement of the hearing, she conceded, through her counsel, that the deposit had been paid by the Brother. She also accepted that the Brother paid stamp duty in respect of the Purchase Contract in the sum of $7,594. There was no evidence as to the source of the deposit or the stamp duty paid by the Brother. For example, there was no evidence as to whether it came from the fan box or from some other source. 4. On 20 September 1997, each of the Brother and the Sister signed a loan application (the Loan Application) addressed to Great Pacific Finance Pty Ltd (Great Pacific). The Loan Application named them as joint borrowers. It also showed joint income of $47,000 per annum, consisting of salaries and wages of $22,000 and business income of $25,000. The Loan Application disclosed the Lakemba Property as being "real estate owned". By the Loan Application, the Brother and Sister declared that the credit to be provided was to be supplied wholly or predominantly for business or investment purposes, or for both purposes. The Loan Application contained a warning that that declaration should not be signed unless the loan was wholly or predominantly for business or investment purposes. By the Loan Application, each of the Brother and the Sister also acknowledged that Great Pacific recommended that each of them seek independent legal or other financial advice before entering into any contract for credit. 5. Great Pacific is a subsidiary of the Bank of Adelaide Ltd (Bank of Adelaide). On 30 September 1997, a "Loan Application Summary" (the Summary) was brought into existence in relation to the Loan Application within the Bank of Adelaide. The Summary recorded that the "Loan Required" was $207,900 and that the "mortgagor" would be the Brother. The Summary stated that the Brother's income was $20,230 and that the Sister's income was $22,677. The Summary recommended the application for approval. Under the heading "General Comments" the following appeared in two different handwritings: "Borrowers are brother and sister who wish to invest in real estate property. They have good savings and asset backing and employment stability." There is no evidence as to the source of that comment. An inference can be drawn that the comment was derived from information furnished to Great Pacific on behalf of the Brother and Sister. 1. On 30 September 1997, Bank of Adelaide offered to lend to the Brother and Sister jointly the sum of $207,900, payable to them or as they might direct. A "Home Loan Contract Schedule" (the Schedule) was attached to the offer. The Schedule provided that security for the loan would be by way of a first registered mortgage over the Carlton Property. The Schedule stated that both the Brother and the Sister were to be mortgagors of the Carlton Property. Attached to the offer was a form of "Acceptance" (the Acceptance). The Acceptance was signed by both the Brother and the Sister and bears the date 3 October 1997. The Lakemba Property was shown as their residential address. 2. Completion of the Purchase Contract took place on 21 November 1997. A Settlement Sheet as at that date relevantly provided as follows: Purchase Price $260,000.00 Less deposit $26,000.00 Balance purchase monies: $234,000.00 Proportion of Municipal Rates payable by purchaser $526.42 Proportion of Water Rates payable by purchaser $40.91 Total $234,567.33 Less amount payable by vendor for water usage $20.72 1. Handwritten notes on the Settlement Sheet recorded that $207,337.50 of the sum of $234,546.61 was to be provided by "bank", presumably Great Pacific or the Bank of Adelaide. That left a balance of $27,209.11 payable to the vendors. The Settlement Sheet contained a handwritten note that that amount was required, together with the following amounts: G K Wilson & Associates $320.00 A L Wunderlich $1,115.00 It is not clear who G K Wilson & Associates were. 1. It appears to be common ground that a bank cheque for the sum of $27,209.11 was provided to Mr Wunderlich to enable completion of the Purchase Contract to take place on 21 November 1997. However, there is a dispute between the Brother and the Sister as to who provided that cheque. For reasons that follow, I am satisfied that the cheque was provided by the Sister. 2. A statement in respect of an account with St George Bank in the name of the Sister records a debit in the sum of $20,000 for a bank cheque on 20 November 1997. A statement in respect of an account with National Australia Bank Limited (NAB) in the name of the Sister records a withdrawal of the sum of $8,484.65 on 20 November 1997. The Sister gave evidence that those two withdrawals were applied in the purchase of a bank cheque in the sum of $27,209.11 payable to the vendors of the Carlton Property. 3. The Brother, however, also gave evidence that he provided a bank cheque for that sum payable to the vendors. I regard his evidence as quite unreliable. Notwithstanding that he had detailed records for other payments made in connection with the Carlton Property and the other properties, he said in evidence that he provided the funds for the purchase of the bank cheque partly in cash that he kept at home and partly from a withdrawal from a bank account. His evidence was unclear as to the amount of cash he had at home. He first said that the sum was $2,000. He later changed that evidence and said that it was $20,000. It is possible that there was some misunderstanding in the interpretation. His final evidence, however, was that he had $20,000 in cash, which he kept under his bed. When asked to identify the bank account from which he had withdrawn the balance, he said that he could not remember which account it was. In the light of that evidence and the clear contemporaneous evidence of the Sister's bank statements, I am satisfied that the Sister provided the bank cheque for the sum of $27,209.11 payable to the vendors to enable completion of the Purchase Contract to be effected. 4. A Loan Account Statement from Great Pacific records that, on 21 November 1997, an advance of $207,900 was made to the Brother and the Sister jointly. That statement records that interest was debited for the first time on 20 December 1997 and that a payment of $1,316.00 was made by direct debt from an account of the Brother with NAB (the NAB Account) on 22 December 1997. Thereafter, interest was debited to the loan account and payments were made to the credit of the loan account either by cheque or direct credit from the NAB Account. 5. The relevant legal principles do not appear to be in dispute. Since the Brother was the sole registered proprietor of the Carlton Property, there would be a presumption that he was the full beneficial owner. [1] However, that presumption may be rebutted if he did not pay the purchase price. Where two people contribute to the purchase price for a property, there is a presumption that the property is held by the purchaser on trust for the contributors as tenants-in-common in the proportions in which they have contributed to the purchase price. [2] That presumption is also rebuttable. For example, evidence of subsequent payments by the parties may be relied upon to draw inferences as to the intentions of the parties at the time of purchase. [3] 6. The Brother accepts that there was no presumption of advancement by reason of the relationship between him and the Sister. However, he relies on both an oral agreement alleged to have been made between the parties prior to the purchase of the Carlton Property and on their subsequent conduct after completion of the Purchase Contract. 7. The Brother said that he met the mortgage broker with whom the Sister was dealing and that in a discussion with the broker he said: "Only use my own name to apply for the home loan, it has nothing to do with my sister." That seems unlikely in the light of his want of familiarity with English. In any event, as I have already indicated, the Loan Application was made in the joint names of both the Brother and the Sister. 1. The Brother gave evidence that he and the Sister met Mr Wunderlich on two occasions. The Brother said that he could not understand what was said by Mr Wunderlich or by the Sister when they conversed in English. He said that the Sister explained to him what Mr Wunderlich said but indicated that he was unable to give any evidence as to what the Sister explained at the time, except that she told him that after they purchased the Carlton Property they should pay the stamp duty. 2. The Brother said that at the second meeting with Mr Wunderlich, they signed the Purchase Contract but, because his English was not good, they could not discuss anything and they just signed the Purchase Contract. He said that he could not remember whether there was discussion about the arrangements for borrowing the purchase price. When asked whether there was discussion about ownership of the Carlton Property, the Brother said that he said: "This property is mine, I pay all the costs. The property is in my name." He gave evidence that he said that in English because he could "speak some simple English at the time". 1. In cross-examination, the Brother was asked why it was necessary to discuss the ownership of the Carlton Property at the solicitor's office if he owned it and the Sister had no interest in it. His response was that they did not discuss the ownership of the Carlton Property except to the extent that he made it clear that the Carlton Property "is in my name only". He repeated that he discussed ownership of the Carlton Property because it was in his name only and because he was liable to pay all the associated costs and expenses. He said that he believed that if he paid all the expenses and costs and the Carlton Property was in his name, that meant that the ownership of the Carlton Property was his. 2. When pressed in cross-examination as to whether, at the meeting with Mr Wunderlich, the Brother told the Sister that he owned the Carlton Property and that she did not, he responded as follows: "At the very beginning she understood that I pay all the expenses and costs. This property has nothing to do with her." He agreed that he did not say at the solicitor's office that he owned the Carlton Property and that the Sister did not own it. He agreed that he never said that he was the owner of the Carlton Property at all. Rather, he said, he believed that that was so. He repeated that he did not say at the meeting that the Sister did not own the Carlton Property but asserted again that he believed "that the property is in my name so it is mine". 1. There was no evidence as to why the Brother would want the Sister to join in the Loan Application other than the assertion that he could not get a loan by himself. However, there was no evidence adduced as to whether he had sought unsuccessfully to obtain a loan or whether he had made any inquiries about the basis upon which he would be able to obtain a loan. 2. The Sister's explanation for the Carlton Property being registered in the name of the Brother alone was that she had marital problems with her husband and that, since she was providing funds for the purchase of the Carlton Property, she did not want her husband to be able to have access to those funds. When it was pointed out to her in cross-examination that, in the first half of 1998, the Turrella Property was bought in the joint names of the Brother and Sister, she said that the reason why she was prepared to be on the title of the Turrella Property was that she did not contribute any equity to the purchase of the Turrella Property. 3. The Brother points to evidence of circumstances that occurred after the completion of the Purchase Contract as giving rise to an inference that the Sister was not intended to have any interest in the Carlton Property and as assisting in the rebuttal of the presumption that would otherwise arise from more or less equal contributions to the purchase price. The Brother also points to the fact that when he and the Sister met Mr Wunderlich, the Sister sought no advice as to how she could protect her interest when the Brother was to be the sole registered owner of the Carlton Property. The Sister's evidence was that the Brother did not attend any meeting with Mr Wunderlich. Having regard to the complete absence of specificity as to any discussion with Mr Wunderlich alleged by the Brother, it is difficult to form a view as to whether the Brother did in fact meet with Mr Wunderlich. In any event, while the Sister's explanation for the Brother being the only registered proprietor is not totally convincing, it is credible. 4. The Carlton Property was used partly as a boarding house. The Sister resided there and collected rent from the other occupants. It appears to be common ground that the rent collected was paid into the NAB Account, which belonged to the Brother, and was then paid, normally by direct debit, to the credit of the loan account with Great Pacific. 5. It is common ground that a total of $117,280 was deposited to the credit of the NAB Account from the time of completion of the Purchase Contract to 30 November 2005. Most of those payments were funded by rent collected from occupants of the Carlton Property. However, the Sister provided some funds of her own, although the quantum of those funds is disputed. The Brother concedes that something in excess of $2,000 was paid by the Sister, while the Sister claims that she paid something in excess of $8,000. Significantly, however, the total amount paid from the NAB Account to Great Pacific during the period was $186,782. Those payments covered both repayments of principal together with interest accruing on the loan made by Great Pacific. 6. The significance is that the amount contributed by way of payment to Great Pacific by the Brother was very substantially in excess of the amount contributed by the Sister. The inequality of contributions counts against a finding that the Brother and Sister intended that the Carlton Property would be owned by them jointly in equal shares. On the other hand, it is difficult to see why the Sister would contribute anything towards the discharge of the indebtedness to Great Pacific if she did not regard herself as having an interest in the Carlton Property. 7. During the period from September 1997 to 30 November 2005, both the Brother and the Sister contributed to outgoings in respect of the Carlton Property for utilities, rates and the like. While there is some doubt about the precise figures, it appears that they contributed to the outgoings in roughly equal shares. That is consistent with a joint understanding that they were to be joint owners of the Carlton Property. It is difficult to see why the Sister would have made any payment towards outgoings if she did not believe she had an interest in the Carlton Property. While she had an interest in ensuring that amounts owing to Great Pacific were paid, since she was personally liable, it was not suggested that the payments that she made from her own funds for the purposes of discharging obligations to Great Pacific were in order to avoid her personal liability. 8. It is common ground that, from 30 November 2005, the Brother was in exclusive occupation of the Carlton Property. From that time, the Sister made no contribution towards either outgoings or the liability to Great Pacific. Rather, the Brother, from that time, paid all amounts owing to Great Pacific and all outgoings in respect of the Carlton Property. There was no evidence as to any arrangement that was entered into in November 2005 whereby the Brother would be permitted to have exclusive occupation of the Carlton Property in consideration, for example, of his bearing all outgoings and liabilities in respect of the Carlton Property. The whole of the liability outstanding to Great Pacific was ultimately discharged by the Brother. 9. On 16 December 2005, the Sister lodged a caveat in respect of the Carlton Property (the First Caveat). The First Caveat claimed an interest as follows: "Equitable interest in the property as a co-mortgagor and sole contributor to loan repayments." The First Caveat was handwritten and was lodged by the Sister personally. The Brother points to the fact that there is no reference in the First Caveat to an agreement that the Carlton Property would be jointly owned or to an allegation that the purchase price for the Carlton Property was contributed jointly. In circumstances where the First Caveat was apparently drawn by the Sister, that is equivocal. 1. On 25 May 2007, Messrs LAC Lawyers, who were acting for the Brother, wrote to the Sister, relevantly saying as follows: "We are instructed that: (a) Since 1992 the following properties were purchased: [The dates of purchase of the Lakemba Property, the Carlton Property, the Turrella Property and the Arncliffe Property, together with the registered owners, are set out]. (b) The properties were registered in either of your names except for [the] Turrella property for the convenience of obtaining bank loans. (c) All the properties should belong to you and your brother in equal shares. You are holding your brother's share in [the] Lakemba and Arncliffe properties in trust for him. Likewise, your brother is holding your share in trust in the Carlton property. (d) Your brother has been paying the expenses in respect of all the properties. (e) You have not accounted to your brother for the rental received in respect of the properties. (f) You have not accounted to your brother for any excess funds you received from the refinance of the properties. (g) Our client believes that you have refinanced the loans on the properties solely for your benefit and to his detriment. …" That is an unequivocal acknowledgment on the part of the Brother that, as at 2007, the Carlton Property was owned jointly. In cross-examination, the Brother agreed that 2(a), (b), and (c) of the letter were accurate as at the date on which the letter was written. 1. On 8 August 2007, the Sister lodged another caveat in respect of the Carlton Property (the Second Caveat). The Second Caveat claimed an interest as follows: "Equitable interest in the property as a co-mortgagor and contributor to the loan repayments." It may be significant that the word "sole", which had appeared in the earlier caveat, was omitted. The Brother again points to the absence of any assertion of an agreement concerning the Carlton Property. While the declaration by the Sister in the Second Caveat was witnessed by a solicitor, it is apparent that the Second Caveat, which is handwritten, was lodged by the Sister personally. Again, I consider the absence of a reference to an agreement to be equivocal. 1. Following receipt by the Sister of a notice of proposed lapsing of the Second Caveat, the Sister commenced proceedings in the Equity Division by summons filed on 4 October 2007 (the Caveat Proceedings). In the Caveat proceedings, the Sister sought an order that the operation of the Second Caveat be extended. In an affidavit sworn on 27 September 2007, she asserted that she was a party to a home loan contract for the purchase of the Carlton Property and had contributed $40,000 towards its purchase. She also asserted that she had managed the Carlton Property since 1997 and had paid all mortgage payment shortfalls from her own monies. In a second affidavit sworn on 25 October 2007, the Sister asserted that she had contributed to the deposit paid on the purchase of the Carlton Property. She also asserted in the affidavit that, from her conversation with her Brother prior to the purchase of the Carlton Property, she believed that she and her Brother were "equal and co-owners" and that, if the Carlton Property were to be sold, they would share equally any money obtained after paying off any debts. 2. On 2 November 2007, orders were made by consent that the Caveat Proceedings be dismissed and that there be no order as to costs. There was no evidence before me as to any discussion or agreement that led to the making of those orders. 3. On 9 November 2007, Michael J Rose, a solicitor acting for the Brother, wrote to the solicitor who had acted for the Sister in connection with the Caveat Proceedings. The letter from Mr Rose relevantly said as follows: "After we investigated all of [the Brother's] bank accounts, here we put together a proposal. The figures below do not include cash amounts [the Brother] has given to [the Sister] occasionally for the past 10 years for maintenance of the properties, for example, pest control building fence, purchase lawn mower and fix gas etc. We have found that [the Brother's] contribution to the investment properties: 1. [Lakemba Property]: [The Brother] contributed $38,339.24. The total cost of the unit is $96,580. Therefore [the Brother's] share of the unit is 39.70%. 2. [Carlton Property and Turrella Property]: [The Brother] contributed $371,886.85. The total cost of running the two investment properties is $279,596 based on we agree the rental income of the properties belongs to the property investment business. Therefore [the Brother's] share of the two houses should be 100% plus $92,290.36 which he has given to [the Sister] but she didn't bank to the mortgage in the years. 3. [Arncliffe Property]: The $92,290.36 mentioned in the item 2 may be invested into this property by [the Sister]. This property under [the Sister's] single title but with two loan accounts. One of them is under both [the Brother] and [the Sister's] joint name." The Brother relies on the terms of that letter as resiling from any admission that might be found to have been made by LAC Lawyers' letter of 25 May 2007. 1. On 28 February 2008, another caveat was lodged in respect of the Carlton Property (the Third Caveat). Unlike the First Caveat and the Second Caveat, the Third Caveat was typed, although it was stated to have been lodged by the Sister personally. The Third Caveat claimed an interest in the Carlton Property by virtue of an unregistered mortgage dated 3 October 1997, the parties to which were the Brother and the Sister. There has been no explanation of the "unregistered mortgage" referred to in the Third Caveat. 2. The Third Caveat also claimed an interest in the Carlton Property by virtue of facts stated as follows: "Prior to 3 October 1997 [the Brother] had an agreement with [the Sister] that [the Sister] would own half the Property, conditional that [the Sister] paid mortgage repayments and the outgoings for the Property. [The Sister] did make those payments until [the Brother] moved into the property in December 2005." The Brother points to the fact that the Third Caveat is the first one in which any agreement between the Brother and the Sister was alleged by the Sister. 1. Finally, the Brother points to the Sister's conduct in connection with his proposed sale of the Carlton Property. At the time, the orders made by Lindsay J were still operative, although the Sister's appeal to the Court of Appeal was also on foot. It appears that, while the Carlton Property was open for inspection in connection with being marketed for sale by the Brother, the Sister attended the Carlton Property and made assertions about her claims to have an interest in the Carlton Property. It was contended on behalf of the Brother that, if she genuinely believed she had an interest in the Carlton Property, she would not have taken steps that might have prejudiced the obtaining of the best price. 2. When asked in cross-examination whether it would be in her financial interest for the Carlton Property to sell for the largest possible amount, the Sister responded that she would rather that the Brother did not sell the Carlton Property. She asserted that the Carlton Property was purchased "with my hard earned money". She asserted that she tried to stop the Brother from selling the Carlton Property but the police notified her that there was "an AVO against myself". The Sister agreed that she did not get any lawyers to write to the Brother saying that she did not want the Carlton Property to be sold. 3. However, the Sister asserted that, whether it was advisable or not, she was seeking to prevent the sale of the Carlton Property altogether. She was not seeking to spoil a sale at the best possible price. I do not consider that the conduct of the Sister is indicative of an acceptance that she did not have an interest in the Carlton Property. Rather, if anything, it is evidence of a belief on her part that she did have such an interest. 4. There are unsatisfactory aspects of the evidence that I have outlined above concerning the conduct of both the Brother and the Sister in connection with the purchase of the Carlton Property and thereafter. As I have said, the viva voce evidence given by both the Sister and the Brother was given in Mandarin through an interpreter. In those circumstances, it is difficult to assess the credibility of the witnesses on the basis of demeanour in the witness box. The Sister was quite voluble in responding to questions in cross-examination and regularly volunteered information that was not responsive to questions. The Brother also from time-to-time failed to respond directly to questions. Having regard to the evidence concerning the purchase of the bank cheque to make up the shortfall in the purchase price, I prefer the evidence of the Sister to that of the Brother where it is in conflict. 5. Accordingly, I consider that it is more likely than not that a discussion took place between the Brother and the Sister prior to the purchase of the Carlton Property along the lines of that deposed to by the Sister in her viva voce evidence. Had I accepted the Brother's version, that may have been sufficient to rebut the presumption that would otherwise have arisen from the manner in which the purchase price was contributed to by the Brother and the Sister. However, the evidence summarised above leads to the conclusion that the purchase price was paid in almost equal proportions by the Sister and the Brother, save for the amount of stamp duty paid by the Brother. 6. That is to say, it appears that the Brother and the Sister contributed more or less equal shares to the total purchase price of $260,000. The Brother contributed the deposit of $26,000, the Sister contributed the shortfall of $27,209.11 for the balance of the purchase price and the Brother and the sister jointly contributed the sum of $207,337.50, which they borrowed jointly from Great Pacific. However, the Brother also paid the stamp duty of $7,594. I would conclude that, subject to possible adjustment in relation to the stamp duty, the Carlton Property was held by the Brother on trust for himself and the Sister as tenants-in-common in equal shares. Insofar as stamp duty was an expense of the purchase of the Carlton Property and was borne by the Brother, it should be brought to account in determining the quantum of their respective contributions to the purchase price. 7. It appears that mortgage duty in the sum of $772.60 was also paid by the Brother. That, however, does not appear to me to be an expense of the purchase. Rather, it is an expense of the borrowing from Great Pacific. On settlement, allowances were made to the vendors in respect of outgoings on the Carlton Property. Those allowances have nothing to do with the purchase price, since they relate to periods following settlement for which the vendors had paid in advance. 8. I consider that the Brother held the Carlton Property on trust for himself and the Sister in the proportions in which they contributed to the purchase price. The adjusted purchase price, with stamp duty, was $268,703. The Brother contributed the following: Deposit $26,000 Stamp Duty $7,594 Half loan from Great Pacific $103,950 Total $137,544 The Sister contributed the following: Shortfall on settlement $27,209 Half loan from Great Pacific $103,950 Total $131,159 1. On 29 October 2016, the Brother entered into a contract for the sale and purchase of the Carlton Property for the sum of $1,200,000 (the Sale Contract). The Sale Contract was completed on 12 December 2016, when the total proceeds of sale, less commission, were received by the Brother. The present dispute between the parties is, in effect, in relation to the entitlement to the proceeds of sale. 2. It is clear that the parties are entitled to an account as to their respective contributions to the discharge of the debt to Great Pacific, including interest, as well as outgoings in respect of the Carlton Property from the time of purchase until the time of sale. It may be that, insofar as the Brother seeks an account from the Sister concerning outgoings in respect of the Carlton Property, he would be required to make allowance in the taking of an account for the occupation fee for the period after 30 November 2005. 3. The question of account is not presently before me. However, it was foreshadowed in a cross-claim filed by the Brother. In the course of the hearing, I ordered that all issues arising under the cross-claim be heard separately from and after the determination of all issues arising under the amended summons. Insofar as there are continuing disputes between the Brother and the Sister as to the beneficial ownership of the other three properties, it would be desirable for the Brother's cross-claim to be amended to raise those questions so that all disputes between the Brother and Sister can be resolved in the same proceedings. 4. Accordingly, at this stage, I do not propose to make any orders other than orders as to the ownership of the Carlton Property. It would be appropriate to defer making consequential orders sought in the amended summons until the cross-claim is resolved. I will direct the Sister to bring in short minutes of orders to give effect to the conclusions that I have reached so far. It will also be necessary for directions to be given for an amended cross-claim to be filed by the Brother raising all outstanding issues. It would not be appropriate to determine how the proceeds of sale of the Carlton Property should be disbursed until the resolution of all outstanding issues. ********** Endnotes 1. See Currie v Hamilton [1984] 1 NSWLR 687 at 690. 2. See Calverley v Green (1984) 155 CLR 242; [1984] HCA 81 at 246-247. 3. See RS & GH Thompson Pty Ltd v Leigh [2006] NSWSC 540 at [36] and Green v Green (1989) 17 NSWLR 343. Amendments 16 April 2018 - [5] delete "which have been paid into a separate account" [35] $187,630 corrected to $186,782 [44] "Mr Rose's letter" corrected to "LAC Lawyers' letter" [54] "the purchase price, with stamp duty, was $267,594" corrected to "the adjusted purchase price, with stamp duty, was $268,703" [58] remove "which are presently held in a separate account" 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. Decision last updated: 16 April 2018