19 To the extent that part of the purchase price has been provided by mortgage funds and under the mortgage each party incurs a joint and several liability that part of the purchase price is deemed to be as contributed by the parties in equal shares: Crew v Sheldon (Supreme Court of New South Wales, Bryson J, 22 September 1995 unreported) at pp1-2.
20 In dealing with the presumption of advancement Gibbs J in Calverley v Green at 251 had the following to say:
"However, both the presumption of advancement, and the presumption of a resulting trust, may be rebutted by evidence of the actual intention of the purchaser at the time of the purchase: see Charles Marshall Pty. Ltd. v. Grimsley (1956) 95 C.L.R. 353 at pp. 364 -365. Where one person alone has provided the purchase money it is her or his intention alone that has to be ascertained. In the present case however both purchasers contributed the purchase money. The amount of $18,000 borrowed under the mortgage was provided equally by the parties, for it was lent to them jointly, on terms which made them jointly and severally liable for its repayment, and, having thus been borrowed, was applied by them in part payment of the purchase price. Where there are two purchasers, who have contributed unequal proportions, but have taken the purchase in their joint names, the intentions of both are material. Even if the parties had no common intention, the intentions of each may be proved, for the purpose of proving or negating that one intended to make a gift to the other."
21 The principal claim is that because of a number of factors which I will discuss the intention was that the property was to be held only by the parents and that the presumption of advancement is rebutted. An alternative position was put regarding contributions resulting from the position of the three owners being joint debtors to the bank. The plaintiff bases this upon the fact that the parents repaid the debt and there was no contribution by the defendant.
22 The prima facie position is that where one of the co-owners pays such a debt in full that party is entitled to require the other co-owner to contribute a rateable amount. In this regard the parties' rights arise from the equitable doctrine of contribution not from the law of property: Calverley v Green at 263; Muschinski v Dodds (1985) 160 CLR 583, 596 - 598 per Gibbs C.J.; Forgeard v Shanahan (1994) 35 NSWLR 206, 224 F per Meagher JA.
23 I turn to whether the presumption of advancement has been rebutted in the present case.
24 According to the plaintiff's submissions there were five factors which suggested that the presumption of the advancement was rebutted. The submissions on this aspect are as follows:
"Firstly, the conversations of the parents which refers to the intentions of the parties at the time of the purchase of the property:
"There is a complication with the Commonwealth Bank making a loan to your father and I as we are too old as pensioners, our income does not quite meet the Bank's guidelines for us to repay the loan before we are of retiring age. Kay Edwards from the Commonwealth Bank has suggested Braydon go on the Contract with your dad and I and that will fix the problem".
And later in pa 20
"When we bought the house we used our savings and the money we got from the sale of Clifford Street and a loan of $35,000 to pay from it. Braydon has not put any of his money in."
Secondly within two weeks of purchase of the property the parents instructed Marsdens solicitors to prepare wills in which each of the parents respectively gave their estate (in the event that they did not survive the other by 30 days) to their executors to hold on trust:
"To transfer all my right title and interest in my home to my son Braydon David Smith."
and
"Transfer the residue of my estate to my daughter Tracey-Lee Smith."
The fact that the parents thought they had an interest in the property of which to dispose is inconsistent with the joint tenancy in which the title to the property was held. It is consistent with a notion that the Defendant held his interest in trust for the parents: See for example Hale v Hale [2004] NSWSC 266 at [41].
Thirdly, during the course of the loan as abovementioned the parents took the positive step to have the Defendant's name removed from the loan account. This was a formalizing of the fact that the parents regarded the property as their own.
Fourthly, the Plaintiff gives evidence that the parents in speaking about the property indicated that it was their home. She gives an example of in or about 1988/1989 after the Defendant had stopped over at the house Brenda made a statement speaking about Braydon to the effect:
"I will not have his drunken, pub-going ways. He is treating the place like it was his own personal hotel."
Brenda asked the Defendant to move out and he did so.
Fifthly, the failure of the defendant to give evidence. The court can assume from the unexplained failure of the Defendant to attend and give evidence, that his evidence would not assist his defence of the case."
25 The time when these events occurred raises the question as to whether one can determine intention from subsequent declarations and conduct. Kaye J provided a useful summary of the law in Wilkins v Wilkins [2007] VSC 100 at [16] to [22]:
16 There is some disagreement in the authorities as to whether the donor, or his or her representatives, is entitled to rely on subsequent acts and conduct of the donor as positive evidence in support of the existence of the resulting trust. There are a number of authorities which expressly state that such evidence is inadmissible. In Sidmouth v Sidmouth (1840) 2 Beav 447 at 454; 48 ER 1254 at 1257 Lord Langdale MR, in a case involving the acquisition of property by a parent in the name of a child, stated:
"Where property is purchased by a parent in the name of his child, the purchase is prima facie to be deemed an advancement ... [T]he relation of parent and child is only evidence of the intention of the parent to advance the child, and that evidence may be rebutted by other evidence, manifesting an intention that the child shall take as a trustee; and in this case as in most others of the like kind, the only question is, whether there is such other evidence. That cotemporaneous acts and even cotemporaneous declarations of the parent may amount to such evidence, has often been decided. Subsequent acts and declarations of the parent are not evidence to support the trust, although subsequent acts and declarations of the child may be so; but, generally speaking, we are looking at what was said and done at the time."
17 Similarly, in Shephard v Cartwright [1955] AC 431 at 446 Viscount Simonds, referring to the presumption of advancement which arises in the case of an acquisition in the name of a child, considered that the principles of law were "well settled" and correctly stated in a number of texts, including the following passage from Snell's Equity : 24th ed p.153
"The acts and declarations of the parties before or at the time of the purchase, or so immediately after it as to constitute a part of the transaction, are admissible in evidence either for or against the party who did the act or made the declaration. ... But subsequent declarations are admissible as evidence only against the party who made them, and not in his favour."
18 In Charles Marshall Pty Ltd v Grimsley , the High Court quoted and adopted as correct the passages from Sidmouth v Sidmouth and Shephard v Cartwright which I have quoted above. In their joint judgment, Dixon CJ, McTiernan, Williams, Fullagar and Taylor JJ stated:
"The plaintiffs are the daughters of the donor and the initial presumption is that he intended to give the shares to them or, in other words, to make them the absolute beneficial as well as the legal owners of the shares. The plaintiffs start with this advantage. The presumption can be rebutted or qualified by evidence which manifests an intention to the contrary. Apart from admissions, the only evidence that is relevant and admissible comprises the acts and declarations of the parties before or at the time of the purchase ... or so immediately thereafter as to constitute a part of the transaction. ... Subsequent statements or acts by the donor could only be evidence not for but against him so far as they were admissions that the plaintiffs were the beneficial owners of the shares. Subsequent statements or acts by the plaintiffs could only be evidence not for but against them so far as they were admissions that the shares were allotted to them as trustees for their father" at 365-6; see also Calverley v Green at 261-2 (per Mason and Brennan JJ)
19 Finally, in Damberg v Damberg [2001] NSWCA 87 at [45] the New South Wales Court of Appeal considered itself bound by the views of the High Court in Charles Marshall and the House of Lords in Shephard v Cartwright in considering that subsequent conduct of the donor, in developing properties placed by him in the names of his children, was inadmissible. Heydon JA (as his Honour then was), with whose judgments Spigelman CJ and Sheller JA concurred, referred to Shephard v Cartwright and Charles Marshall Pty Ltd v Grimsley and noted that:
"Viscount Simonds' formulation is generally taken implicitly to exclude not only subsequent declarations which are not admissions, but subsequent conduct. ... The principles are old ... They stem from an age where party witnesses were disqualified on grounds of interest" at [45] .
20 Heydon JA thus concluded at [45] that the evidence of the husband, in developing the properties and working on them after they had been placed in the names of his children, should have been excluded. His Honour stated:
"The husband relied on his conduct in developing the properties and working on them even after they were in the names of the children. Use of the evidence about that conduct for that business offends the principles laid down in Shephard v Cartwright (1955) AC 431 at 445-6 so far as they survive the Evidence Act 1995 (Cth): the conduct was not an admission, was not part of the transaction, and was self-serving. ... However the evidence was admitted. ... The children had no complaint about this. The evidence in question is far from conclusive, but it offers some support for the trial judge's conclusion."
21 On the other hand there is some authority which supports the proposition that subsequent acts and conduct of the donor may be admitted in evidence in support of the proposition that the property acquired by the donor in the name of the donee is subject to a resulting trust. In Davies v The National Trustees Executors and Agency Co of Australasia Limited [1912] VLR 397 at 403-4 Cussen J stated:
"It was said that evidence of declarations of the husband or father (the donor) tending to negative the presumptive advancement must be confined to declarations before or at the time of the transaction being investigated. I agree with this if such evidence is tendered directly to prove his mental condition at that time -- that is, to prove the intention which accompanied his act. But I can conceive circumstances in which such a declaration might be proved to rebut evidence given by the other side, or as a basis for direct admission, or that indirect form of admission which may, in certain circumstances, be implied from silence. It was also suggested that evidence of subsequent acts or conduct of the husband or father (as distinct from oral declarations or statements) if tending to negative the presumption could not be admissible. I think this is not correct. Such acts or conduct may be confirmatory of an expression of intention proved aliunde. I respectfully agree with what was said by Lopes LJ in Re Grove [1888] 40 CD 216:
`I have always understood the law to be that in order to determine a person's intention at a given time you may regard not only conduct and acts before and at the time, but also conduct and acts after the time, assigning to such conduct and acts their relative and proper weight and cogency.'
Notwithstanding this statement I should exclude subsequent oral declarations of the husband or father, and I should also exclude subsequent acts which, from want of continuity or otherwise, must in substance be regarded as merely equivalent to oral declarations if the tendency was to negative the presumption of advancement and such subsequent declarations or acts were tendered merely as direct proof of the prior intention. My view on this point makes admissible evidence tending to show that the husband or father dealt with the property as his own, particularly if he so dealt with it continuously from the time of the transaction being investigated. The admission of such evidence is merely an illustration of a general principle as to such confirmatory matter being admissible. Its weight in some circumstances would be very great, in others very small."
In the present case it is not necessary to resolve the difference in the authorities. It was the plaintiff who sought to adduce evidence as to the conduct of his parents, and in particular his mother, in relation to Killingworth after it was acquired by them and placed in the names of the plaintiff and his brother Neil. The plaintiff sought to prove that he and Neil, and not his parents, had been responsible for payment of rates and other outgoings in relation to the property, and for tending and developing the property. In those circumstances evidence adduced by the defendant as to the conduct of William and Norma Wilkins, after the acquisition of Killingworth, was clearly admissible in rebuttal. In any event, to the extent that it was relied on affirmatively by the defendant, it was adduced without objection on behalf of the plaintiff.