Arfaras v Vosnakis

Primary judgment

1. The arrangement that the primary judge found had been reached between Mr Vosnakis and Mrs Arfaras as a result of the conversations on 19 and 20 July 2012 was described at [49] of his Honour's reasons as follows: Ms Arfaras offered, and probably insisted, that Mr Vosnakis arrange for his wife to be buried in the burial plot, and that Ms Arfaras would transfer title to the burial licence to Mr Vosnakis, so that in due course he could be buried together with his wife. Ms Arfaras did not require any payment. When it was discovered that Ms Arfaras would not be able to exercise the burial licence in relation to the adjacent burial plot in which her mother was buried, Mr Vosnakis agreed at his own expense to cause his solicitor to act for Ms Arfaras in relation to all of the steps necessary to enable her to obtain a grant of probate in relation to her mother's estate. …
2. The primary judge considered the law concerning the grant and effect of exclusive licences for burial and the statutory and regulatory provisions governing the grant of burial licences and the control and management of cemeteries. It is not necessary to set out his Honour's reasons in relation to those matters as there is no challenge to the conclusions that his Honour reached as to the legal and practical consequences of Mr Vosnakis' decision to cause his late wife to be buried in the subject plot.
3. His Honour concluded (at [141]) that from the time that the late Mrs Vosnakis was buried in the subject plot, Mr Vosnakis (as the legal personal representative of her estate) became entitled to enforce an irrevocable licence that would give him certain legal rights to prevent her resting place being disturbed. His Honour thought it probable that the ancillary right to maintain the gravesite in Mr Vosnakis' favour under the general law had been excluded or at least limited by the operation of r 5 of the rules governing the Botany Cemetery.
4. His Honour also concluded that, on the exercise of the right of first nomination by the holder of the burial licence (Mrs Arfaras), that aspect of the burial licence was exhausted but that the burial licence nevertheless remained in force between the cemetery authority and Mrs Arfaras ([142]).
5. At [151], having repeated his earlier conclusion that an irrevocable licence coupled with a grant arose in favour of Mr Vosnakis at the time the cemetery authority permitted him to bury his late wife in the subject plot, his Honour concluded that, at the time of the conversations between Mr Vosnakis and Mrs Arfaras, the subject matter of the alleged contract was a contractual licence but that it did not consist of, or grant, any interest in land.
6. As noted earlier, his Honour held (at [147]) that the events that occurred between 19 and 25 July 2012, when the late Mrs Vosnakis was buried, did not give rise to a binding and enforceable contract requiring Mrs Arfaras to transfer the burial licence to Mr Vosnakis. His Honour reached that conclusion for two separate (and independent) reasons, each of which his Honour considered was sufficient to justify the conclusion that no enforceable contract was made.
7. First, his Honour was not satisfied that the parties "made a bargain, in the sense that the one made a promise to the other, in each case, in exchange for receiving the benefit of the promise made by the other". His Honour concluded that Mr Vosnakis "did not in any real or practical way make a promise to Ms Arfaras" that he would cause his wife to be buried in the subject plot (see [147]); rather, there was simply the making of an arrangement that was implemented in part. His Honour thus concluded that Mrs Arfaras' agreement to transfer the subject plot to Mr Vosnakis was not done in any real way in return for anything to be done by Mr Vosnakis.
8. Second, his Honour did not accept that the objective circumstances justified a conclusion that the parties intended to create legally binding relations between themselves (at [148]).
9. As to the claim based on estoppel, his Honour found (at [153]) that Mrs Arfaras had induced Mr Vosnakis to exercise the right of burial in respect of his wife by causing her to be buried in the subject plot. His Honour said: … Ms Arfaras plainly knew that the purpose of the transfer [of the relevant burial licence] was to permit Mr Vosnakis to be able to ensure that he would be buried in the same place as his wife. She offered to Mr Vosnakis that that result should occur. It is probable that Ms Arfaras understood, and if not she ought reasonably to have understood, that Mr Vosnakis complied with her suggestion on the understanding that she would honour her promise to transfer the burial licence to him. It is also probable that she understood, and if not she ought reasonably to have understood, that as Mr Vosnakis appeared to want to be able to ensure that he would be buried with his wife, and as he had the right of burial in relation to his wife, he would not have caused his wife to be buried in the burial plot, if he had been told before the burial that Ms Arfaras would renege on her promise. The evidence would not support a finding that suitable burial plots were in such short supply that Mr Vosnakis would have been obliged for practical reasons to cause his wife to be buried in the burial plot anyway. On the contrary, it should have been understood by Ms Arfaras that, if she had not promised to transfer the burial licence to Mr Vosnakis, he would have obtained an alternative burial licence on his own account, so that he could ensure that he and his wife would be buried in the one place. (my emphasis)
10. His Honour noted that Mrs Arfaras' refusal to honour her promise to transfer the burial licence to Mr Vosnakis had created the situation that he could no longer look forward to being buried with his wife unless he went through the process of causing her exhumation and reburial. Though Mr Vosnakis had at one stage prior to the proceedings taken the position that if Mrs Arfaras was not prepared to transfer the licence to him he would take whatever action was necessary to exhume his late wife's remains and deal with them as he and his family deemed appropriate, his Honour noted the disinclination of the Court to make orders for exhumations and the "self-evident aversion that a husband in Mr Vosnakis' position would have to disturb his wife's remains, and to go through the process of exhumation and reburial".
11. At [155], his Honour said: In practical and emotional terms, when Ms Arfaras permitted Mr Vosnakis to exercise his right of burial by causing Ms Vosnakis to be buried in the burial plot, she allowed him to exhaust that right once and for all. The Court should not regard the legal possibility of exhumation and reburial as being a course that should be imposed upon Mr Vosnakis, if he persists in his desire to be buried with his wife.
12. Pausing there, in the present proceedings it is not suggested that there was no detrimental reliance on Mr Vosnakis' part because of a possibility that Mr Vosnakis could seek to have his late wife's body exhumed (T 15.10) though detrimental reliance is disputed on other bases.
13. At [158], his Honour concluded that it was against conscience for Mrs Arfaras to change her mind and refuse to transfer the burial licence after Mr Vosnakis had, on the assumption induced by her promise that she would transfer the burial licence to him (to enable him to be buried with his wife), in a real and practical way, exhausted his right of burial by causing his wife to be buried in the burial plot.
14. From [159], his Honour considered whether the considerations which had caused him to conclude that the parties did not intend to make a contract detrimentally affected Mr Vosnakis' entitlement arising from the principles of estoppel. His Honour concluded, by reference to Giumelli v Giumelli [1999] HCA 10; (1999) 196 CLR 101 (per Gleeson CJ, McHugh, Gummow and Callinan JJ at [35] and [36]) and Vukic v Grbin [2006] NSWSC 41 (per Brereton J at [27]-[28]), that they did not.
15. At [163] his Honour said: In my view all of the requisite elements are satisfied in the present case, with the result that Ms Arfaras holds the burial licence on the basis that she is required to transfer it to Mr Vosnakis, so that he will be able to control the exercise of the second right of nomination in a way that will ensure that he is buried with his wife, if that should continue to be his wish.
16. His Honour considered it to be no bar to that conclusion that the subject matter of Mrs Arfaras' obligation was merely a personal licence that gave her a contractual right against the cemetery authority, or that the detriment that Mr Vosnakis suffered was the exercise of the right of burial, which his Honour noted was a right recognised and enforced by equity. His Honour accepted (at [164]) that the nature of the detriment suffered by Mr Vosnakis in this case might be unusual, but said that it was significant when measured against the value of the burial licence held by Mrs Arfaras and in that respect it was material.

Appeal/Cross-Appeal

1. Although Mrs Arfaras' draft notice of appeal raises six grounds of appeal, as set out below, one of those (ground 3) was effectively abandoned in the course of argument (see T 13.4-40). (1) His Honour erred in holding that the appellant is estopped from resiling from an assumed state of affairs said to have been created in relation to the subject burial plot. (2) His Honour erred in determining that to the knowledge of the appellant the plaintiff had relied on statements relating to the making available of the plot in his acceptance of the offer of a gift of the burial plot and the exercise of his right of burial with respect thereto. (3) His Honour erred in failing to conclude that the contractual licence to which the appellant was entitled as against the cemetery authority was a right capable [sic; scil incapable] of attracting the application of any principle of proprietary or equitable estoppel. (4) His Honour erred in failing to hold that the respondent had not suffered or would not suffer any material or significant disadvantage of a substantial and irreversible kind flowing from any reliance on the appellant's conduct. (5) His Honour erred in concluding that the transfer of the burial licence to the respondent would not involve any significant detriment to the appellant. (6) His Honour erred in failing to find, on the plaintiff's claim for estoppel, that it would be wholly inequitable and unjust to insist upon a disproportionate making good of the relevant assumption.
2. Mr Vosnakis in turn seeks to cross-appeal on the following grounds: (1) His Honour erred in finding that there was no binding contract between Mrs Arfaras and Mr Vosnakis on the basis that the promise/s by Mrs Arfaras and Mr Vosnakis were not given in exchange for the promise/s of the other. (2) His Honour erred in finding that there was no binding contract between Mrs Arfaras and Mr Vosnakis on the basis that there was no intention to be bound. (3) His Honour erred in finding that events between 19 and 25 July 2012 did not give rise to an enforceable contract.

Application for leave

1. Mr Vosnakis opposed the grant of leave to appeal on the basis that his Honour's findings of fact had not been challenged; that his Honour's application of law to the findings of fact was not remarkable; and that there was little point in granting leave to appeal as the appeal had insufficient prospects of success to justify leave.
2. Issues of principle were, however, raised on the applicant's submissions. In the circumstances, it is appropriate to grant leave to appeal and, therefore, also to grant leave for the cross-appeal.

Cross-appeal - was there a binding contract?

1. I will first consider the cross-appeal, given that if this Court were to conclude that his Honour had erred in finding that there was no binding contract, then there would be no room for the operation of the principles of equitable estoppel.
2. As noted above, his Honour made that determination for two independent reasons. Mr Vosnakis challenges each of those reasons. I will deal with them in turn.

Was there an exchange of promises?

1. Mr Vosnakis submits that the present factual situation is not analogous to that considered in Australian Woollen Mills Pty Ltd v Commonwealth [1954] HCA 20; (1954) 92 CLR 424, where the High Court considered that the necessary relation had not been shown to exist between the statement or announcement relied on as a promise and the act said to have been done in consideration of the promise.
2. Rather, Mr Vosnakis submits that the structure of Mrs Arfaras' offer to him included both the consideration that she would provide to him (i.e., the transfer of the burial licence) and the consideration that he would provide to her (i.e., that he would cause his wife to be buried in the burial plot).
3. Mr Vosnakis argues that Mrs Arfaras' promise to transfer to Mr Vosnakis the burial licence (including the right to select or nominate the second occupant of the subject plot) was objectively offered as a "quid pro quo" for Mr Vosnakis exercising his right to bury his wife in that plot. It is submitted that there was a clear identification of the conditions or requirements to be satisfied by each party and clear reciprocity between the fulfilment of the obligations of each party, such that this case can be distinguished from that described in Ashton v Pratt [2015] NSWCA 12; (2015) 88 NSWLR 281 (by Meagher JA at [228]).
4. Mrs Arfaras submits, to the contrary, that there was no identification of any conditions or requirements to be satisfied in return for the making or fulfilment of the expressed statement of intention and that the response by Mr Vosnakis did not suggest that he was undertaking legally enforceable obligations in return for what was proposed (adopting the language in Ashton v Pratt at [228]; [230]). It is submitted that the acceptance by Mr Vosnakis of what was offered by Mrs Arfaras (i.e., the ability to bury his wife in the subject plot) was entirely unconditional.
5. Mrs Arfaras points to the distinction between cases involving a quid pro quo arrangement and those involving a representation of intention upon which another party is content to act. She argues that a mutual understanding which amounts to no more than a representation of intention upon which the other party was content to act does not amount to a contract (referring to Wells v Matthews [1914] HCA 50; (1914) 18 CLR 440 at 444 per Griffith CJ). Reliance is also placed on the observation in Barns v Barns [2003] HCA 9; (2003) 214 CLR 169 (at [75] per Gummow and Hayne JJ) that that which is propounded as a contract may, on consideration of the evidence, be no more than a family understanding or representation of intention which lacks binding effect.
6. Insofar as Mr Vosnakis submits that his Honour did not properly address the "structure" of the parties' arrangement, I do not accept that criticism of his Honour's reasons. His Honour accepted that the promise that Mrs Arfaras would transfer the relevant burial licence to Mr Vosnakis may have been implicit in her offer that he could be buried in the same burial plot as his wife and also accepted that Mrs Arfaras had sought the emotional benefit of her daughter being buried in the subject plot (at [147]). His Honour was therefore well aware that the arrangement was one that involved an offer that, if accepted, would result in a benefit to Mrs Arfaras. It may be inferred that his Honour accepted that a promise by Mr Vosnakis to nominate the subject plot as his late wife's burial place would be capable of amounting to consideration for Mrs Arfaras' offer to transfer the burial licence to him.
7. The relevant question is whether, properly characterised, the conversations of 19/20 July 2012 amounted to an exchange of promises (i.e., a promise to transfer the burial licence in exchange for a promise to bury Mrs Arfaras' daughter in the subject plot) or perhaps, although this was not how the case was pleaded but is on one view implicit in Mrs Arfaras' promise, an offer by Mrs Arfaras of the Carbolic Smokeball kind (Carlill v Carbolic Smoke Ball Co [1893] 1 QB 256) albeit not being made to the world (i.e., I promise to transfer the burial licence to you if you bury your wife in the subject plot) whereby acceptance of the offer and consideration for the promise consists in the doing of the particular act (the burial of his wife in the subject plot).
8. In either of those circumstances (provided that there was objectively an intention to create legal relations) a binding contract would have come into existence.
9. The difficulty that I have in reaching the conclusion that the relevant conversations can be so characterised is that, while the promise (or offer) by Mrs Arfaras to transfer the burial licence to Mr Vosnakis was clearly predicated on the assumption that the late Mrs Vosnakis would be interred in the subject plot (since it was expressed in terms that "you can go with her"), the successive offers made by Mrs Arfaras (to make the subject burial plot available for her daughter and then to transfer the burial licence to Mr Vosnakis to enable him to be buried with her in due course) were not expressed in the language of mutually dependent promises. Rather, the conversations are more readily understood as amounting to a succession of gifts that Mrs Arfaras was willing to bestow on Mr Vosnakis; and his acceptance of the offer of the subject plot as the place where his wife could be buried was not made subject to or conditional upon the promise by Mrs Arfaras that she would then or later transfer the burial licence to him.
10. Therefore, I am of the opinion that his Honour did not err in concluding that there was in effect a gift offered by Mrs Arfaras (and accepted unconditionally by Mr Vosnakis) of the subject plot as a resting place for her daughter, followed by a separate promise (unsupported by consideration) that she would transfer the burial licence to Mr Vosnakis.

Was there objectively an intention to be bound?

1. As to the second basis for his Honour's conclusion that there was not an enforceable contract, it is not disputed that the test as to intention to create binding relations is an objective one. It takes into account not only the words used but also the subject matter of the agreement, the status of the parties to it, their relationship to one another, and other relevant surrounding circumstances (Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; (2002) 209 CLR 95 at [25]).
2. Mr Vosnakis argues that the subject matter of the agreement was of a serious nature and that, unlike the position in Ashton v Pratt, the obligations to be undertaken by each party were ascertainable, certain and specific; this being a powerful indication of intention to create legal relations.
3. Mr Vosnakis emphasises that Mrs Arfaras signed the application for interment of her daughter, thereby granting an indemnity to the trustees of the Botany Cemetery and agreeing to be bound by the regulations, by-laws and conditions applicable to the subject plot; that Mr Vosnakis signed the instruction sheet specifying that his wife was to be buried in the subject plot; and that Mr Vosnakis signed the funeral services agreement with Acropolis Funeral Services Pty Limited, accepting significant binding financial obligations. He notes that all three documents were signed in the presence of Mrs Arfaras, Mr Vosnakis and the funeral director on 20 July 2012.
4. In effect, the submission for Mr Vosnakis is that a court will more readily conclude that there was an intention to create legal relations in a family context where an arrangement has been implemented in part and where one party (here, Mr Vosnakis) is left vulnerable to the other party resiling from the arrangement. Reliance is placed on the discussion by Professor Atiyah to that effect in Introduction to the Law of Contract (6th ed, 2005, Clarendon Press at p 104).
5. In response to that submission, Mrs Arfaras: notes that those matters do not appear as findings of fact; argues that Mr Vosnakis' submissions of that kind did not in terms form part of Mr Vosnakis' contract case at trial; and says that the signing of documents would not constitute evidence of an exchange of mutual promises but would simply constitute conduct consistent with implementation of a mutual understanding which, in the circumstances, amounted to no more than a representation of intention by Mrs Arfaras upon which Mr Vosnakis was content to act.
6. The fact that the arrangement was implemented in part was a matter to which his Honour referred in his reasons. It does not lead me to conclude that there was, objectively ascertainable, the requisite common intention to be contractually bound by the terms of the arrangement at the time the arrangement was reached. As Mrs Arfaras points out, such conduct is equally consistent with Mr Vosnakis acting in accordance with acceptance of an unconditional offer and the hope or expectation that the burial licence would be transferred to him at some later stage.
7. Mr Vosnakis raises two particular complaints as to his Honour's reasoning on this issue. Neither is sustained on my reading of his Honour's reasons.
8. First, it is submitted that his Honour's finding as to lack of intention to be bound was based on the grief experienced by Mr Vosnakis and Mrs Arfaras, together with the family relationship between them ([148]-[150]). It is submitted that it was not open to his Honour to make the finding of lack of intention on the basis that the parties were distressed and grieving; and that the evidence pointed to the family connection being a "distant and hostile one" (reference there being made to the evidence of Mr Vosnakis' daughter (Mrs Friedrich) in cross-examination to the effect that her mother had not enjoyed a good relationship with Mrs Arfaras).
9. In this regard, what his Honour said was that he considered it self-evident that both parties would have been extremely distressed following the unexpected death of Mrs Vosnakis but that he was satisfied that both Mr Vosnakis and Mrs Arfaras had "rationally and conscientiously attended to the practical arrangements necessary for Ms Vosnakis' funeral and burial". His Honour then said (at [148]) that: … it is hardly conceivable that in the extremity of their mutual situation they thought, in the necessary objective sense, that once the arrangement had been made, it would be contractually enforceable, so that, if Mr Vosnakis changed his mind, and decided to bury his wife in a completely different burial plot, Ms Arfaras could obtain an injunction from the Court to enforce the interment of Ms Vosnakis in the burial plot. Equally, it was not objectively intended that Mr Vosnakis could oblige Ms Arfaras to transfer the burial plot to him by obtaining remedies appropriate for the enforcement of a contract. In essence, in my view, the thought that the parties were solemnly entering into a binding legal contract could not have been further from their minds.
10. I do not read his Honour's reference to the emotional state of the family members at the time of the relevant discussions as something that was determinative of the finding as to lack of intention to create binding relations. To the contrary, his Honour was satisfied that the parties had been able rationally and conscientiously to attend to the funeral arrangements. The reference to the extremity of their mutual situation seems, in context, no more than an observation by his Honour as to the unlikelihood that, at the time and in the objective circumstances in which the relevant conversations were taking place, the parties' common intention was to be bound to a legally enforceable agreement. There is no error there disclosed.
11. As to the significance of the family connection, his Honour expressly disavowed reliance on any presumption arising out of the family relationship, stating at [149] that he did not consider that this was a case where the application of a rebuttable presumption of fact (that family arrangements or agreements are not intended to have legal force) would have an effect on the outcome of the proceedings. His Honour made clear that the finding he had made was on the basis of an objective assessment of the state of affairs between the parties (see [148]-[149]), having expressly referred to what was said in Ermogenous at [24] in that regard.
12. Second, complaint was made that his Honour was confusing right and remedy when referring (at [148], in the passage extracted above) to the unlikelihood that the parties had thought "in the necessary objective sense" that the arrangement would be contractually enforceable. This, the Court was informed, was Mr Vosnakis' best point (see T 30.34), namely that his Honour had impermissibly engaged in mind-reading and had improperly allowed his conclusions about the subjective intentions of the parties to influence him.
13. However, as I read his Honour's reasons (at [148]-[149]), his Honour was not there suggesting that because a court might not have enforced an agreement or arrangement it could not objectively be determined that the parties intended immediately to be bound by it. Nor do I consider that his Honour was there confusing subjective intentions with an objective assessment of the state of affairs between the parties. Rather, his Honour was explaining why it was that, looking at the objective circumstances, he considered that a finding that the parties' intention was to be bound to an enforceable contract would not be justified. No error is there established. Having regard to the terms of the respective conversations and the objective circumstances known to his Honour, the conclusion that the parties' objective intention was not that they were to be contractually bound seems to me, with respect, to be correct. Had the common intention of the parties been to enter into a binding contract at that stage one would have expected that there would be more precision in the specification of its terms and conditions.
14. Mr Vosnakis relies, as contemporaneous conduct supporting the conclusion that the parties regarded their arrangement as binding, first, upon the fact that he accompanied Mrs Arfaras to her house to collect the documents that would allow him to carry out his obligation to obtain probate in her favour of her mother's estate and to transfer the rights to choice of occupant of the burial plot to Mrs Arfaras from her mother, both at his own expense; and second, to the fact that Mrs Arfaras gave him the documents. However, as noted earlier in relation to the entry into the arrangements for the burial of Mr Vosnakis' wife, such conduct is equally consistent with the parties honouring promises that were not objectively intended to have binding legal effect.
15. Finally, I should note that a factor relied upon by Mrs Arfaras as inconsistent with an objective intention to be bound to the terms of the arrangement was what was referred to as the "relatively transitory" right that Mr Vosnakis would have obtained had the promise been performed (see the discussion at T 12.5-13.4). However, it is not necessary to deal with this argument at this stage in light of the conclusion I have otherwise reached as to the lack of an objectively ascertainable common intention to be bound by the burial arrangements. As it was conceded that this submission was of more relevance to the estoppel argument, I propose to deal with it in that context.
16. His Honour did not err in concluding that, on the evidence before him, an intention to enter into a binding legal contract was not objectively ascertainable, notwithstanding the serious nature of the subject matter of the relevant conversations.

Conclusion on cross-appeal

1. The cross-appeal should be dismissed. No error has been established in his Honour's conclusion as to the lack of an enforceable contract.

Appeal - Estoppel

1. I turn then to the issues raised by Mrs Arfaras' appeal. These relate to his Honour's finding that Mrs Arfaras was estopped from denying that Mr Vosnakis was entitled to the perpetual interment right in relation to the subject plot.
2. Although complaint was made in the written submissions filed by Mrs Arfaras that his Honour had failed to identify the nature or type of the estoppel found to have arisen, the real gravamen of her complaints goes to the question whether his Honour erred in finding the essential elements of an equitable estoppel (as those elements were articulated in Waltons Stores (Interstate) Limited v Maher [1988] HCA 7; (1988) 164 CLR 387 (at 428).
3. For completeness, however, I note that there was no particularity in the way in which the estoppel claim was pleaded. At [13] of Mr Vosnakis' further amended statement of claim, the allegation was simply that Mrs Arfaras was estopped from denying Mr Vosnakis' entitlement to the burial licence. Nor did the precise nature of the estoppel emerge from the declaratory relief sought, which was in the alternative: a declaration that Mrs Arfaras was estopped from denying the existence of a binding contract between the parties and, in the alternative, a declaration that she was estopped from denying that Mr Vosnakis was entitled to the burial licence for the burial plot.
4. In closing submissions before the primary judge the estoppel was described as both a promissory estoppel and a proprietary estoppel, which may go some way to explaining his Honour's general description of the estoppel claim.
5. In this Court, however, any suggestion of a claim based on promissory estoppel was emphatically disavowed by Mr Vosnakis. Instead, Mr Vosnakis argues that his estoppel claim should be understood as a case of proprietary estoppel by encouragement of the type considered in Dillwyn v Llewelyn (1862) 4 De GF & J 517; 45 ER 1285 (not proprietary estoppel by acquiescence of the type considered in Ramsden v Dyson (1866) LR 1 HL 129).
6. The principle of proprietary estoppel was stated by Mason CJ and Wilson J in Waltons Stores v Maher (at 404) as follows: [A] person whose conduct creates or lends force to an assumption by another that he will obtain an interest in the first person's land and on the basis of that expectation the other person alters his position or acts to his detriment, may bring into existence an equity in favour of that other person, the nature and extent of the equity depending on the circumstances.
7. Estoppel by encouragement of the kind considered in Dillwyn v Llewelyn has been described by the authors of Meagher, Gummow and Lehane's Equity: Doctrines and Remedies (5th ed, 2014, LexisNexis) at [17-065] as: … bind[ing] the donor of property where, after the making of an imperfect gift, the donor induces the donee to act on the assumption that the imperfect gift is effective or on the expectation that it will be made effective.
8. The authors of Young, Croft and Smith's On Equity (2009, Lawbook Co) at [12.180] distinguish between estoppel by acquiescence (as considered in Ramsden v Dyson and Svenson v Payne [1945] HCA 43; (1945) 71 CLR 531 at 539) as a "passive" form of estoppel; and estoppel by encouragement (as considered in Dillwyn v Llewelyn) as an "active" form of estoppel.
9. Robert Walker LJ in Jennings v Rice [2003] 1 P & CR 100; [2002] EWCA Civ 159 noted (at [44]) that: The cases show a wide range of variation in both of the main elements [of a proprietary estoppel], that is the quality of the assurances which give rise to the claimant's expectations and the extent of the claimant's detrimental reliance on the assurances. emphasising that the doctrine applies only if these elements, in combination, make it unconscionable for the person giving the assurances "to go back on them".
10. In the present case, his Honour's reference to Giumelli v Giumelli indicates that his Honour was approaching the case as one to which the doctrine of proprietary estoppel by encouragement was applicable.
11. In Sidhu v Van Dyke [2014] HCA 19; (2014) 251 CLR 505 at 522 the plurality in the High Court noted (at [81]), in the context of the category of equitable estoppel, the application of the statement of principle by Dixon J in Grundt v Great Boulder Proprietary Gold Mines Ltd [1937] HCA 58; (1937) 59 CLR 641 at 674. Dixon J, there referring to estoppel in pais, said: [I]t is often said simply that the party asserting the estoppel must have been induced to act to his detriment. Although substantially such a statement is correct and leads to no misunderstanding, it does not bring out clearly the basal purpose of the doctrine. That purpose is to avoid or prevent a detriment to the party asserting the estoppel by compelling the opposite party to adhere to the assumption upon which the former acted or abstained from acting. This means that the real detriment or harm from which the law seeks to give protection is that which would flow from the change of position if the assumption were deserted that led to it. So long as the assumption is adhered to, the party who altered his situation upon the faith of it cannot complain. His complaint is that when afterwards the other party makes a different state of affairs the basis of an assertion of right against him then, if it is allowed, his own original change of position will operate as a detriment. His action or inaction must be such that, if the assumption upon which he proceeded were shown to be wrong and an inconsistent state of affairs were accepted as the foundation of the rights and duties of himself and the opposite party, the consequence would be to make his original act or failure to act a source of prejudice.
12. See also Meagher JA in Walsh v Walsh [2012] NSWCA 57 (at [13]), referring to the application of the above statement equally to promissory and proprietary estoppels (Delaforce v Simpson-Cook [2010] NSWCA 84; (2010) 78 NSWLR 483 at [1], [6], [43], [44]).
13. In the present case, the primary judge approached the estoppel claim as one based on a promise by Mrs Arfaras to do something (i.e., to transfer the burial licence) on which there had been detrimental reliance by Mr Vosnakis so as to make it unconscionable in the circumstances for Mrs Arfaras to resile from that promise. Nothing turns on whether a more precise articulation of the estoppel finding should have been made.
14. There is no challenge to his Honour's finding that the subject matter of the relevant promise was a contractual licence that did not consist of, or grant, any interest in land; nor to the finding that at the (later) time the cemetery authority permitted Mr Vosnakis to bury his wife in the subject plot an irrevocable licence coupled with a grant arose. Further, the complaint that the contractual licence was not capable of attracting the application of any principle of proprietary or equitable estoppel (ground 3) was not pressed.
15. Turning then to the gravamen of Mrs Arfaras' appeal, she argues that his Honour erred in finding that each of the essential features of equitable estoppel was established in this case. It is submitted that his Honour erred in adopting, or applying, the test set out in Vukic v Grbin per Brereton J (at [27]-[28]). In oral argument, the focus of the challenge to the primary judge's conclusions was as to the findings of detrimental reliance and inducement.
16. The essential elements of an equitable estoppel as articulated in Waltons Stores v Maher (at 428) are as follows: In my opinion, to establish an equitable estoppel, it is necessary for a plaintiff to prove that (1) the plaintiff assumed that a particular legal relationship then existed between the plaintiff and the defendant or expected that a particular legal relationship would exist between them and, in the latter case, that the defendant would not be free to withdraw from the expected legal relationship; (2) the defendant has induced the plaintiff to adopt that assumption or expectation; (3) the plaintiff acts or abstains from acting in reliance on the assumption or expectation; (4) the defendant knew or intended him to do so; (5) the plaintiff's action or inaction will occasion detriment if the assumption or expectation is not fulfilled; and (6) the defendant has failed to act to avoid that detriment whether by fulfilling the assumption or expectation or otherwise. For the purposes of the second element, a defendant who has not actively induced the plaintiff to adopt an assumption or expectation will nevertheless be held to have done so if the assumption or expectation can be fulfilled only by a transfer of the defendant's property, a diminution of his rights or an increase in his obligations and he, knowing that the plaintiff's reliance on the assumption or expectation may cause detriment to the plaintiff if it is not fulfilled, fails to deny to the plaintiff the correctness of the assumption or expectation on which the plaintiff is conducting his affairs.
17. In Vukic v Grbin, Brereton J in effect summarised those six requirements into three matters (at [28]): First, in relation to the plaintiff's conduct: that the plaintiff acted (or abstained from acting) in reliance upon an assumption or expectation that a particular legal relationship existed or would exist between the plaintiff and the defendant, or that the plaintiff had or would acquire some interest in the defendant's property; Secondly, in relation to the defendant's conduct: that the defendant induced the plaintiff to adopt the assumption or expectation and encouraged the reliant activities of the plaintiff, or at least failed to deny the assumption or expectation with knowledge that the plaintiff was relying on it to the plaintiff's potential detriment and that it could be fulfilled only by transfer of the defendant's property, a diminution of the defendant's rights or an increase in the defendant's obligations; Thirdly, in relation to the interest or property: that the assumption or expectation was one which the defendant could lawfully satisfy.
18. Brereton J did not suggest that he was there intending any departure from the analysis in Waltons Stores v Maher, to which authority his Honour expressly referred at the conclusion of the above extract.
19. I turn then to the complaints made as to each of the six elements of equitable estoppel.
20. As to the first, Mrs Arfaras accepts that an equitable estoppel may arise in the absence of a binding or enforceable contract, but submits that this will only be in limited circumstances confined to cases such as the completion of an imperfect gift (citing DHJPM Pty Ltd v Blackthorn Resources Ltd [2011] NSWCA 348; (2011) 83 NSWLR 728 at 738-748 per Meagher JA; 750-756 per Handley AJA; Saleh v Romanous [2010] NSWCA 274; (2010) 79 NSWLR 453 per Handley AJA).
21. In Blackthorn, at [49], Meagher JA said: The reference in Brennan J's proposition (1) to an expectation that "a particular legal relationship would exist" and that the party said to be estopped "would not be free to withdraw" from it, draws attention to two essential aspects of the expectation. The first is that it must be as to a legal relationship which is expected to exist between the parties. The second is that the expectation be induced by a promise which is intended by the promisor and understood by the promisee to affect their legal relations with the result that it is treated between them as something which the party estopped is "bound to do or not to do". This appears from Brennan J's analysis at 421, 422.
22. His Honour there noted (at [50]) that in the joint judgment in Waltons Stores v Maher, Mason CJ and Wilson J said (at 403): ... The point is that, generally speaking, a plaintiff cannot enforce a voluntary promise because the promisee may reasonably be expected to appreciate that, to render it binding, it must form part of a binding contract. and (at 406): As failure to fulfil a promise does not of itself amount to unconscionable conduct, mere reliance on an executory promise to do something, resulting in the promisee changing his position or suffering detriment, does not bring promissory estoppel into play. Something more would be required. Humphreys Estate suggests that this may be found, if at all, in the creation or encouragement by the party estopped in the other party of an assumption that a contract will come into existence or a promise will be performed and that the other party relied on that assumption to his detriment to the knowledge of the first party.
23. In the present case, it is submitted for Mrs Arfaras that all she can be said to have encouraged was a hope or confident expectation on the part of Mr Vosnakis, neither of which is sufficient to give rise to an equitable estoppel. However, the expectation or assumption found by the primary judge was that Mrs Arfaras would perform her promise to transfer the burial licence. That is sufficient for the purposes of the first element identified in Waltons Stores v Maher. It falls within the formulation given in Silovi Pty Ltd v Barbaro (1988) 13 NSWLR 466 by Priestley JA (Hope and McHugh JJA agreeing) (at 472): For equitable estoppel to operate in circumstances such as those of the present case there must be the creation or encouragement by the defendant in the plaintiff of an assumption that a contract will come into existence or a promise be performed, and reliance on that by the plaintiff, in circumstances where departure from the assumption by the defendant would be unconscionable.
24. His Honour did not err in concluding that Mr Vosnakis had an assumption or expectation (based on the promise made to him by Mrs Arfaras) that he would acquire from Mrs Arfaras her interest in the burial licence to the subject plot.
25. As to the second of the elements identified in Waltons Stores v Maher, Mrs Arfaras argues that his Honour erred in concluding that her conduct was in the nature of an inducement. She submits that his Honour did not identify any aspect of her conduct which could be said properly to found a conclusion that she induced Mr Vosnakis to adopt the relevant assumption or expectation.
26. Little weight was placed on this complaint in the oral submissions; with good reason. There was in my opinion sufficient inducement established by reference to Mrs Arfaras' conduct in promising to transfer the burial licence to Mr Vosnakis; in repeating that promise in the presence of the representative from Acropolis Funerals; and in accompanying Mr Vosnakis to her home to collect the necessary documents to enable him to arrange for that to take place. Insofar as his Honour's reasons identify only the making of the promise as the conduct amounting to inducement (see [153]), they must be read as referring to the context in which that promise was made.
27. As to the third of the elements identified in Waltons Stores v Maher, Mrs Arfaras submits that proof must be of actual (not imputed or presumed) reliance (referring to the plurality judgment in Sidhu at 522 and 533). Mrs Arfaras complains that his Honour's findings as to reliance were not based on "actual" reliance. That complaint cannot be sustained in light of his Honour's acceptance of Mr Vosnakis' evidence that he would not have buried his wife in the subject plot had it not been for the conversations with Mrs Arfaras in which she told him that she would transfer the subject plot to him so that he could make arrangements to be buried in the same burial plot as his wife (in his affidavit at [7]). At [26], his Honour found that Mr Vosnakis was a credible and persuasive witness whose evidence was not in any way shaken (as his Honour also found Mr Vosnakis' daughter and sister; by contrast to his finding as to Mrs Arfaras' evidence).
28. Mr Vosnakis' evidence as to reliance was a sufficient basis for the finding of actual reliance.
29. As to the fourth of the elements identified in Waltons Stores v Maher, it is submitted for Mrs Arfaras that his Honour did not have regard to the requirement that it be established that she knew or intended Mr Vosnakis to act or abstain from acting in reliance on the assumption or expectation that she would transfer the burial licence to him. Reference is made to the passage at [153] of his Honour's reasons where his Honour said that it was probable that Mrs Arfaras understood "and if not she ought reasonably to have understood" that Mr Vosnakis had complied with her suggestion on the understanding that she would honour the promise and that he would not have caused his wife to be buried in the burial plot had he been told that she would renege on her promise.
30. It is submitted that there was no evidence that Mrs Arfaras had held such knowledge or intention and that the matters set out at [153] are based on speculation and assumption and fall short of establishing the requisite knowledge or intention in this regard.
31. For Mr Vosnakis it is submitted that the logical and obvious inference to be drawn from the making by Mrs Arfaras of the promise was that she intended Mr Vosnakis to rely upon it.
32. I read his Honour's reasons at [153] as comprising a finding that, on the balance of probabilities, it should be inferred that Mrs Arfaras did have the requisite intention that Mr Vosnakis should rely on her promise and understood that he was so doing when he accepted her offer of the subject plot. The fact that the promise to transfer the licence was predicated on her daughter being buried in the subject plot makes this clear; as does her conduct in assisting Mr Vosnakis to obtain the necessary documentation to enable the burial of his late wife in the subject plot. Any other finding would not accord with common sense.
33. Mrs Arfaras, as his Honour found, was seeking to achieve the emotional benefit of her daughter being buried in the subject plot. It was an available (and almost inescapable) inference that she made the promise intending Mr Vosnakis to rely on it. That is what his Honour must be taken to have meant at [153]; not that there was an impermissible presumption of reliance.
34. As to the fifth requirement (for detrimental reliance), Mrs Arfaras notes (referring to Fifteenth Eestin Nominees Pty Ltd v Rosenberg (No 2) [2009] VSCA 178; (2009) 24 VR 155) that the failure to make good on a promise unsupported by consideration does not of itself amount to the requisite detriment (Commonwealth v Verwayen [1990] HCA 39; (1990) 170 CLR 394 at 416).
35. Mrs Arfaras points to his Honour's finding that Mr Vosnakis suffered a material detriment in the form of the loss of an expectation that he could be buried with his wife ([154]; [164]) and submits that the evidence did not clearly support a positive finding that Mr Vosnakis held any such expectation as at or before the time of the alleged promise. She argues that no detriment arises in circumstances where Mr Vosnakis would have been in the same position had the alleged promise not been made (citing Sidhu at [92] per Gageler J).
36. In Sidhu, the plurality referred again (at [92]) to what was said by Dixon J in Grundt v Great Boulder, saying that: The need for the respondent to establish such a difference stems from what Dixon J described in Grundt v Great Boulder Pty Gold Mines Ltd as the "indispensable" condition that a party asserting an estoppel "must have so acted or abstained from acting upon the footing of the state of affairs assumed" that the party asserting the estoppel "would suffer a detriment if the opposite party were afterwards allowed to set up rights against him inconsistent with the assumption". That is to say, "the real detriment or harm from which the law seeks to give protection is that which would flow from the change of position if the assumption were deserted". There can be no real detriment if the party asserting the estoppel would have been in the same position in any event. (citations omitted) and went on at [93] to say: The question of causation is therefore ordinarily appropriately framed, as it was implicitly framed by the primary judge in the present case, as being: "Despite any other contributing factors, would the party seeking to establish the estoppel have adopted a different course (of either action or refraining from action) to that which [the party] did had the relevant assumption not been induced?" (citations omitted)
37. In Donis v Donis [2007] VSCA 89; (2007) 19 VR 577, Nettle JA, as his Honour then was, referred (at [34]) to the detriment there suffered as: … of a kind and extent that involves life changing decisions with irreversible consequences of a profoundly personal nature … beyond the measure of money and such that the equity raised by the promisor's conduct can only be accounted for by substantial fulfilment of the assumption upon which the respondent's actions were based.
38. In the present case Mrs Arfaras submits that the detriment identified by his Honour is not a material detriment in the relevant sense required to found an equitable estoppel (Legione v Hateley [1983] HCA 11; (1983) 152 CLR 406 at 437) and is not capable of being described as substantial and irreversible (Commonwealth v Verwayen at 416) such as would allow a conclusion that Mr Vosnakis has been placed in a position of significant disadvantage; and does not involve a life-changing decision with irreversible consequences of a profoundly personal nature as was the case in Donis v Donis.
39. As adverted to earlier, Mrs Arfaras argues that the promise to transfer the relevant burial licence, if performed, would have supplied no more than a relatively transitory right and one that would necessarily cease on Mr Vosnakis' own death (since any election he might make during his life to be buried in the subject plot would not be binding on his legal personal representatives after his death) (see the discussion at T 12.5-13.4).
40. However, those submissions ignore the fact that, if the licence was transferred to Mr Vosnakis, he would obtain the ability to control the right of nomination in respect of the remaining burial place in the subject plot during his lifetime and would have the comfort, at least, of being able to make his views as to the exercise of that right of nomination known to his legal personal representatives through his will or otherwise, and hence the comfort of knowing that his executors were in a position to comply with his wishes. As to the submission that no life changing decision of an irreversible nature has been made, that flies in the face of the acceptance by Mrs Arfaras that once Mr Vosnakis exercised the right of nomination in respect of his wife's burial place he effectively exhausted that right. It was no longer open to him, as a practical matter, to nominate another burial plot over which he would have the benefit of a burial licence in his own name rather than be left to the whims of Mrs Arfaras as to whether she would at some stage honour the promise made to him.
41. Thus the material detriment that Mr Vosnakis has suffered, in my opinion by acting on the faith of and in reliance on Mrs Arfaras' promise, is that, he having exercised the right to determine where his wife was to be buried in accordance with Mrs Arfaras' wishes, he has for all practical purposes exhausted that right and, by reason of Mrs Arfaras' refusal to honour her promise to him, does not have the ability to control the second right of nomination in respect of the subject plot and does not have the comfort of knowing that he has (to the extent possible) preserved for himself the ability to be buried next to his wife. That is sufficient detrimental reliance for the purposes of the doctrine of equitable estoppel here being considered.
42. Finally, as to the relief that was granted, Mrs Arfaras complains as to the finding by his Honour that the transfer of the burial licence would not impose any significant detriment on her ([156]). It is submitted that his Honour erred in failing to take into account, first, the evident value of such a right in circumstances where Mrs Arfaras had acquired the licence for valuable consideration in 1977 and where the licence represented security for her own burial following her death. It is submitted that his Honour failed to have regard to the evidence that Mrs Arfaras has two sisters and hence the possibility that she could obtain the right to be buried in the adjoining plot did not represent a "viable replacement" of her right pursuant to the burial licence. It is also submitted that his Honour erred in finding (at [156]) that there was no impediment to the transfer of the burial licence to Mr Vosnakis as Mrs Arfaras did not positively assert a disinclination to be buried in close proximity to Mr Vosnakis.
43. In those circumstances it is submitted that his Honour erred in failing to find that to deprive Mrs Arfaras of her rights in respect of the burial plot in which her daughter was buried would be to insist on a disproportionate making good of the relevant assumption.
44. His Honour considered the detriment to Mrs Arfaras of requiring her to make good the promise (at [156]). Mr Vosnakis points out that it was inherent in the arrangement that the parties reached that Mrs Arfaras would have a secure gravesite and the ability to be buried in a grave adjoining her daughter's grave. He argues that there was no evidence to suggest that this could not have been achieved; that he took the necessary steps required on his part; and that it was Mrs Arfaras' choice not to proceed with the probate application.
45. The relevant question is as to whether it is unconscionable for Mrs Arfaras to resile from her promise in all the circumstances and, if not, whether the appropriate relief is to require her to transfer the burial licence.
46. Insofar as it is submitted for Mrs Arfaras that his Honour's reasons implicitly acknowledge that it would be open for Mr Vosnakis to change his mind in the future (in which case Mrs Arfaras has been deprived of her interest in the burial licence unnecessarily), the question of unconscionability is to be determined at the time of departure of the promise. In Blackthorn, Meagher JA said (from [71]-[73]): That proposition describes, albeit not exhaustively, circumstances where a departure from the assumption by the party said to be estopped would be contrary to good conscience measured according to equity's standards: see Waltons Stores v Maher at 428-429. Priestley JA's formulation of the relevant principle in Austotel v Franklins (at 606) requires for an equitable estoppel that any departure from the assumption be "unconscionable". In Australian Securities Commission v Marlborough Gold Mines Ltd [1993] HCA 15; (1993) 177 CLR 485 at 506 the terms "unjust" and "unconscionable" are used. The time for addressing whether it would be contrary to good conscience for a defendant to depart from an expectation is the time that that party seeks to do so: Evans v Evans at [107]-[109] referring to the earlier approval by this Court in Delaforce v Simpson-Cook [2010] NSWCA 84 at [81] of the following remark of Hoffmann LJ in an unreported judgment of Walton v Walton (Court of Appeal, Civ Div, 14 April 1994, unreported) at [21]. That remark was also approved in Thorner v Major at [56]-[57] and [101]: "... [N]one of this reasoning applies to equitable estoppel, because it does not look forward into the future and guess what might happen. It looks backwards from the moment when the promise falls due to be performed and asks whether, in the circumstances which have actually happened, it would be unconscionable for the promise not to be kept." At that time equity will look at all the relevant circumstances "that touch upon the conscionability (or not) of resiling from the encouragement or representation previously made, including the nature and character of the detriment, how it can be cured, its proportionality to the terms and character of the encouragement or representation and the conformity with good conscience of keeping a party to any relevant representation or promise made": per Allsop P (Giles JA agreeing) in Delaforce v Simpson-Cook at [3], [6]. Those circumstances may result in relief being refused or in relief which does not fulfil the encouraged expectation because to do so would "exceed what could be justified by the requirements of conscientious conduct and would be unjust to the estopped party" or would not take account of the impact of such relief on third parties and any hardship or injustice they would suffer: Giumelli v Giumelli at [42], [50]; Delaforce v Simpson-Cook at [60]-[67].
47. In the present case, the lengths to which Mr Vosnakis has gone to enforce the promise made to him hardly suggest that he is not presently minded to ensure, so far as possible, that he be buried in the same burial plot as his late wife. There was no evidence that Mrs Arfaras was not capable of securing for herself the benefit of the second resting place in her late mother's burial plot (and it would presumably have been a simple matter for her to have pointed to any impossibility in that regard). The fact that she expended money to acquire the burial licence some years ago does not amount to an injustice sufficient to outweigh the detriment to Mr Vosnakis of departure from her promise.
48. His Honour did not err in concluding that the appropriate relief was to order Mrs Arfaras to make good the promise.

Conclusion as to appeal

1. His Honour did not err in concluding that all the requisite elements for an equitable estoppel in the nature of a proprietary estoppel by encouragement were made out. Mrs Arfaras promised to transfer the burial licence to Mr Vosnakis. She did so expressly on the basis that this would enable him in due course to be buried with his late wife. She made that promise as part of her offer (and, his Honour thought likely, her insistence) that Mr Vosnakis bury his wife in the subject plot. The only reasonable inference to be drawn is that she intended Mr Vosnakis to rely on that promise when deciding where to bury his wife.
2. Mr Vosnakis established that he had relied on that promise to his detriment in the sense that he then lost, for all practical purposes, the ability to nominate that his wife be buried elsewhere and to control, during his lifetime, the second right of nomination in respect of that burial plot. His Honour did not err in concluding, on the evidence before him, that to require Mrs Arfaras to honour her promise would not be a disproportionate remedy.
3. The appeal should be dismissed.

Costs

1. That leads to the question of costs. Neither party wished to incur the costs of further argument in relation to this issue. For Mrs Arfaras it was submitted that if, as has transpired to be the case, both the appeal and cross-appeal were to be dismissed, then there should be no order as to costs, if for no other reason than the pragmatic one of saving the assessment costs that would follow if costs orders were to be made following the "event" in the case of both the appeal and cross-appeal. For Mr Vosnakis it was submitted that in the event that this Court were to reach the conclusion that I have reached, he should recover his costs of the proceedings in this Court, since he has been successful overall.
2. I am of the view that Mrs Arfaras should pay the costs of the proceedings in this Court. The cross-appeal was in essence defensive and it is not apparent that significant costs would have been incurred in relation to that issue over and above the costs of arguing the appeal itself. In substance Mr Vosnakis has been successful in resisting Mrs Arfaras' attempt to overturn the order that she transfer the burial licence; and hence in holding Mrs Arfaras to her promise.

Orders

1. The orders I propose are as follows: 1. Leave be granted to appeal/cross-appeal. 2. Appeal be dismissed. 3. Cross-appeal be dismissed. 4. Applicant to pay the respondent's costs of the proceedings in this Court of both the appeal and the cross-appeal.
2. SIMPSON JA: I agree with Ward JA.

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