Bell v Graham [2000] VSC 142

Supreme Court of Victoria|2000-05-11|Before: KELLAM J

REAL PROPERTY - caveat - application by one tenant in common for removal of caveat by estranged wife of another tenant in common - interest of caveator claiming property entitlement pursuant to Family Law Act (C'lth) - whether the claim of a spouse for an order of settlement of property in Family Law proceedings can create a caveatable interest - application for declaration of interest in real property - Family Law Act 1975 (C'lth) s.79 - Transfer of Land Act 1958 s.90(3).

It is appropriate to set out a brief history of this proceeding and the proceedings in the Family Court of Australia which preceded it. Mr and Mrs Graham separated in December 1993. A Decree Nisi Dissolution of Marriage was granted on 21 February 1995. By proceeding No. ML11376 of 1993 issued by Mrs Graham in the Family Court of Australia ("the family law proceedings") she made application for distribution of property from her former husband to her. On 19 March 1996 in the course of those proceedings Mr Graham swore an affidavit which was subsequently filed in the Family Court. In that affidavit Mr Graham deposed to having an interest in the land. He valued that interest to be "approximately $20,000". No doubt in consequence of Mr Graham's assertion that he held such an interest, on 8 January 1998 Mrs Graham lodged a caveat against the title to the land. Subsequent to the lodging of the caveat, Mrs Bell intervened in the Family Law Proceedings. However, leave was granted for Mrs Bell to withdraw from the Family Law proceedings on 12 November 1999, upon Morgan J ruling that the Family Court had no jurisdiction to determine the issues between Mrs Bell and Mr and Mrs Graham. As I have said, in the meantime, on 26 August 1999 Mrs Bell issued an Originating Motion and a summons on Originating Motion in this Court. The summons was supported by an affidavit sworn 26 August 1999 by Mrs Bell's solicitor, Mr David Misso. A document headed Statement of Claim was annexed to the Originating Motion. Despite this somewhat unorthodox originating process it would appear that it was determined that there should be pleadings in the proceeding, as Ashley J ordered the delivery of defences at a directions hearing conducted on 2 December 1999.

The Statement of Claim referred to above alleges that Mrs Bell, Mr Graham and Christine Graham were the only children of Ernest Best Graham ("Mr Graham senior") who died in February 1984 leaving a will dated 28 October 1981. The Statement of Claim alleges that the will provided Mrs Bell with an option to purchase the land. It should be noted that, in fact, the will provided that Mrs Bell was to have an option of purchase of the land in the event that her mother, Lucy Graham ("Mrs Graham senior") predeceased her husband, Mr Graham senior. The option which was provided for by the will of Mr Graham senior never came into effect because Mrs Graham senior survived Mr Graham senior by approximately 18 months. By reason of Mr and Mrs Graham senior owning the land as joint tenants, Mrs Graham senior became the sole proprietor of the land upon the death of her husband by survivorship. By her will she left the whole of her residuary estate, including the land to her three children, Mrs Bell, Mr Graham and Christine Bell (now "Mrs Zabod") as tenants in common in equal shares.

The Statement of Claim then alleges that in May 1986, Mrs Bell gave written notice to Mr Graham and to Mrs Zabod exercising her "option" to purchase the land. The particulars refer to the land as having a value of $95,000 and that she was prepared to pay each of them one third of that amount being $31,667. It alleges that Mrs Bell paid amounts to them and, in particular that she paid Mr Graham the sum of $12,550 on 12 September 1990. The Statement of Claim further alleges that Mr Graham was indebted to Mrs Bell in the sum of $45,813 including an amount of $30,000 owing in respect of a mortgage over the land which was paid out by Mrs Bell on Mr Graham's "behalf." It alleges that Mrs Graham lodged caveat No V188530W on the title to the land on 6 January 1999. The caveat was in fact lodged on 8 January 1998. It then alleges that "as a consequence of the foregoing, the Plaintiff has paid the amount owing to" Mr Graham in respect of the land. It also alleges that Mr Graham is indebted to Mrs Bell in the sum of $26,501, although that should probably be $26,701. I was informed in the course of the hearing by counsel for Mrs Bell that that claim for the alleged indebtedness of Mr Graham to Mrs Bell was abandoned.

The Defence filed by Mr Graham pursuant to the order of Ashley J denies the alleged exercise of any option by Mrs Bell. It however admits the payment by Mrs Bell to him of the sum of $12,550 on 12 September 1990. The Defence denies any other debt owed by Mr Graham to Mrs Bell.

The Defence filed by Mrs Graham pursuant to the order of Ashley J claims an interest in the land which "accrued to her during the period of her marriage (to Mr Graham) prior to 1986." It alleges that she has rights pursuant to sections 78 and 79 of the Family Law act 1985 which are still to be determined. It also alleges that she made contributions in money and labour in improving and maintaining the land, but there are no particulars. There is no counterclaim.

The proceeding was fixed for hearing before me on 10 February 2000. At the commencement of the proceeding Mr Testart of counsel who appeared for Mrs Bell informed me that the issues between Mrs Bell and Mr Graham had been "resolved by agreement" and that Mr Graham would consent to an order being made declaring that he had no interest in the land and further to an order that any interest he had in the land had been extinguished on 15 November 1990. The solicitor for Mr Graham, Mr Webb confirmed that he had instructions to consent to such orders. Mr Byrne who appeared for Mrs Graham expressed concern at the suggestion that the Court should make a declaration by the consent of Mrs Bell and Mr Graham when such order would have an effect upon Mrs Graham's interests. I declined to make the orders sought by consent between Mrs Bell and Mr Graham. In my opinion to do so involved a risk of injustice to Mrs Graham. In particular I observed that although Mr Graham was then prepared to consent to an order that any interest he had in the land was extinguished in 1990, he had nevertheless sworn the affidavit referred to above on 19 March 1996 deposing to then having an interest in the land which he valued at approximately $20,000. Furthermore, on 5 February 1998 Mr Graham had filed a financial statement in the Family Court whereby he asserted he had a 27% interest in the land. In the circumstances I concluded that the interests of justice were not served by making a consent order in the terms proposed by Mr Testart and Mr Webb and that I should hear and consider the evidence in this proceeding before making any order relating to the interests of the parties in the land.

Only two witnesses gave evidence before me, Mrs Bell and Mrs Graham. In addition a number of documents were tendered in evidence. Mrs Graham had no knowledge of the circumstances relating to the land. She had never attended at the land after the death of Mr and Mrs Graham senior, nor did she have any knowledge of Mr Graham attending at the land, after that time.

Upon the death of Mrs Graham senior, Mrs Bell and her family commenced to use the land as their holiday home. Mrs Bell and her husband paid the rates, mowed the lawns and accepted responsibility for the general upkeep of the land including painting of the house together with other costs related to the maintenance and ownership of the land.

After the death of Mr Graham senior, Mrs Bell and her husband had sole possession of the keys to the house erected upon the land. Mrs Bell gave evidence that neither Mr Graham nor Mrs Graham ever went to the land after the death of Mr Graham senior.

Mrs Bell gave evidence before me that it was always understood between her and her brother, Mr Graham, and her sister, Mrs Zavod, that she had an option to purchase the land from them. I accept that this is the case. There is evidence that Mrs Bell paid her sister a total of $27,555 in two payments made in 1987 and 1990. There is also evidence that Mrs Bell paid Mr Graham $12,550 on 12 September 1990. I am satisfied that these payments were made by Mrs Bell to them on account of her purchase from them of their respective interests in the land.

In addition to the above payments, on 15 November 1990 Mrs Bell repaid 50% of a mortgage debt over the land. She paid the sum of $30,251.48. The evidence about this mortgage was unsatisfactory but apparently it was a mortgage entered into after the death of Mr Graham senior for the benefit of a company formerly conducted by him and, following his death, conducted by Mr Graham. Mrs Bell has at all times adopted the view that the payments made by her to her sister and to Mr Graham referred to above in paragraph 11 were in satisfaction of the understanding that she and they had that she would become the sole owner of the land and would pay to them amounts necessary to extinguish their respective interests in the land. She has, at least in recent years, taken a similar view in relation to the repayment by her of the mortgage debt of $30,251.48 referred to above. There has never, however, been any agreement reached between Mrs Bell, and her sister or Mr Graham as to an actual sale price of their interest in the land. Neither has there ever been any agreement about the payment of interest. The land has never been transferred into Mrs Bell's name. She said in the course of giving her evidence "... I blithely went along and presumed Somers was mine, our family's and that was it."

The matters in issue in this proceeding arose in consequence of the breakdown of the marriage of Mr and Mrs Graham in 1993. In the course of the property proceedings brought in the Family Court of Australia in 1996, Mr Graham swore an affidavit on 19 March 1996 whereby he deposed as follows:

"50. That upon my mother's death in 1986 I received a one third share in the family home at Lot 22 (sic) Ocean View Crescent, Somers. I also received funds in the sum of approximately $3,000 which I invested into the business. 51. That the real property situate at and known as Lot 22 (sic) Ocean View Crescent, Somers is registered in the names of my sisters Dierdre Bell, Christine Zabod and I as tenants in common in equal shares. 52. That in fact my sister Dierdre is entitled to the major interest in the property as she has paid to Christine and me sums of money representing part payment of our interest in the holiday home. 53. That it was the intention of Dierdre, Christine and I that Dierdre acquire a full interest in the holiday home. In about 1990 Dierdre paid Christine and I $12,550 each, and I estimate my remaining interest in the said property at present at approximately $20,000."

It should be noted that on 26 March 1996 charges were laid against Mr Graham by Victoria Police alleging that he dishonestly gained a financial advantage from the National Bank by presenting a forged guarantee document purportedly signed by Mrs Graham in support of a loan facility. On 30 April 1996 Mr Graham was granted bail. He absconded to the United States that afternoon and has not since returned to Australia.

On 6 January 1998 Mrs Graham lodged a caveat against the title to the land claiming an interest in fee simple "pursuant to a constructive trust between" her and Mr Graham. Subsequent to the caveat being lodged Mrs Bell sought leave to intervene in the Family Court property proceedings between Mr Graham and Mrs Graham. Such leave was granted in March 1999 and Mrs Bell claimed against Mr Graham her beneficial entitlement to the land and against Mrs Graham for the removal of the caveat lodged upon the title of the land. Unfortunately the decision in Re Wakim [1999] 173 ALJR 839 intervened before the hearing of the proceeding. It is common ground that the Family Court, in consequence of the decision in Re Wakim has no jurisdiction to determine the claim made by Mrs Bell. Accordingly Mrs Bell commenced this proceeding in this Court on 26 August 1999.

It must be said that what has occurred in the circumstances of this case is a most unfortunate situation. There are long standing proceedings in the Family Court between Mr Graham and Mrs Graham. These proceedings have been further delayed pending the determination of Mrs Bell's claim which she has now been compelled to litigate in this Court. No doubt extra costs have been incurred by both parties.

It is convenient to turn first to the application to remove the caveat. The application is presumably made pursuant to Section 90(3) of the Transfer of Land Act. This depends upon whether or not Mrs Graham has a caveatable interest in the land. Regrettably the submissions put before me by both parties were scant indeed in relation to this matter. However it is clear that Mrs Graham as caveator has the onus of providing that she has a caveatable interest in the land, that is, that she has the "estate or interest" in the land the subject of the caveat. Lewenberg and Pryles v Direct Acceptance Corporation [1981] VR344 at p.347.

The claim made by Mrs Graham in the caveat is on the basis of a constructive trust. In the Defence filed on her behalf the interest in question is alleged to have "accrued to her during the period of her marriage" to Mr Graham prior to 1986. That claim was not supported by any evidence led by her, nor was it the subject of any detailed submissions put before me. Rather, it appears to have been assumed by Mrs Graham, or those advising her that the fact that she has made a claim in the Family Court of Australia entitles her to claim an interest in the land on the basis that her former husband has or may have such an interest himself. It was not argued, nor was there any evidence put before me to the effect that Mrs Graham has any interest pursuant to a constructive trust. In particular, there was no evidence or any submission to support the allegation that Mrs Graham had made contributions in money or labour in respect of the land. It is clear that the relationship of marriage alone does not create a caveatable interest pursuant to a constructive trust and that the question of whether or not a spouse has a caveatable interest pursuant to a constructive trust must be decided in accordance with the same general principles which apply to persons who are not spouses. McMahon v McMahon [1979] VicRp 23; [1979] VR 239.

Accordingly, before me, the only basis upon which Mrs Graham sought to assert her right to a caveatable interest in the land is that she has the right under s.79 of the Family Law Act 1975 (C'lth) to seek an order in the Family Court that an interest in land registered in the name of her husband Mr Graham be vested in her. The right to seek such an order arises as part of the Family Court's general jurisdiction to redistribute the property of both of the parties to the marriage in a fair and equitable fashion. However, the Family Law Act does not give a party to a marriage a caveatable interest in land unless and until such time as the Family Court makes an order in respect of that land. Re Weeks Caveat [1970] QWN 4; Bethian v Green [1978] HCA 4; (1977) 3 Fam LR 11, 579; Dembitzer v Mills [1980] 2 NSWLR 697; In the Marriage of Stevens (1991) 15 Fam LR 51; Australian Eagle Insurance Co Ltd v Parry (1992) ANZ Conv Rep 166.

Accordingly I am satisfied that Mrs Graham has failed to establish that she has any existing interest in the land which is capable of supporting the caveat and that the order sought by Mrs Bell for removal of the caveat should be granted. In the event that I was to arrive at this conclusion, no submission was made to me on behalf of Mrs Graham as to any other course I should adopt. It is clear that on an application under section 90 (3) of the Transfer of Land Act the Court has a discretion as to the order to be made. The discretion is a wide one: Commercial Bank of Australia Ltd v Schierhalter [1981] VicRp 32; [1981] VR 292 at p296. Whilst the proper exercise of the discretion might not justify a refusal to remove the caveat, in the circumstances, and particularly those circumstances which arose at the commencement of the hearing of this proceeding on 10 February 2000, I am concerned that Mrs Graham's application in the Family Court, in the event that it was to be successful, should not be rendered nugatory. In the exercise of my discretion I propose to defer the date of the order for removal of the caveat for a period of 14 days to enable Mrs Graham to seek advice as to her position and to take such steps as she may be advised to take.

In addition to the order sought for removal of the caveat Mrs Bell seeks a declaration that neither Mr Graham nor Mrs Graham has any interest in the land. For the reasons already given I am satisfied that Mrs Graham does not have an existing interest in the land.

Mr Graham's position is different. He has a registered interest in the land. However, I am satisfied on the evidence before me that the intention of Mr Graham and Mrs Bell at all material times following the death of their mother was that Mrs Bell (and her family) would have the sole right to occupy the land and that Mr Graham would sell his interest in the land to Mrs Bell when she had the money to pay him for it. Mrs Bell and her family have occupied the land and to all intents and purposes have treated it as their own since the death of her father. They have maintained the house and land and they have paid all expenses in relation to it. I am satisfied that Mrs Bell paid Mr Graham $12,550 in September 1990 pursuant to this arrangement and in part satisfaction of his interest in the land. It should be noted that pursuant to the same arrangement Mrs Bell paid her sister Mrs Zavod a total sum of $27,555 between 1987 and 1990. However, notwithstanding the fact that such payments were made the parties never reached agreement on a price.

The evidence before me is that Mrs Bell endeavoured to reach agreement with Mr Graham and Mrs Zavod on a price based upon a total valuation of the land in November 1989 of $92,000. However, neither of them agreed to this and no subsequent agreement was ever reached. It should be noted that the land was valued by the Union-Fidelity Trustee Company for the purposes of the probate of the will of Mrs Graham senior as at the date of her death (20 August 1985) in the sum of $80,000. Accordingly, as at the date of her death a one third interest in the land was valued in the sum of $26,666. As stated above I am satisfied that Mrs Bell paid the sum of $12,550 to Mr Graham in September 1990 and that such payment was pursuant to the above arrangement and in part satisfaction of her of his interest in the land. However, Mrs Bell also submits that the repayment by her of the sum of $30,251.48 in October 1990 in repayment of the mortgage over the land was paid in full satisfaction of the remaining interest in the land held by Mr Graham. The circumstances of the taking out of the mortgage in question and its repayment were not the subject of detailed evidence before me. Mr Graham's affidavit filed in the Family Court and referred to above does not disclose any relevant circumstance relating to the mortgage. Mrs Bell in evidence before me stated as follows:

"When my dad died ... and all the assets were frozen, and my brother came to me and said ... to keep the business running, could we take out a mortgage on Somers, I'll have to drop Don's wages, my husband who worked with Peter at the time, to half, but you can draw on this mortgage in lieu of wages ..."

She said that she and her husband did not receive any of the money from the mortgage in a lump sum. She said that at the end of the month when her housing payment was due she and her husband would "... go to Peter and say, I need $400 or $700, or whatever was due at that time and he would give my husband the money". She said that in November 1990 she was advised by her accountant that the mortgage had been called up and she was required to repay half of that mortgage which she did in the sum of $30,251.48 on 15 November 1990. She said that that mortgage had been taken out for the benefit of the company and that there had never been any agreement that she repay half. She said she did pay half because the interest was mounting up. Mrs Bell does not contend that there was any agreement by Mr Graham that the repayment of half the mortgage was in satisfaction of any sum owed to him for his interest in the land. She said: "It was I suppose just a foregone conclusion in lieu of wages." She said it was never discussed.

It is apparent that there were financial dealings between Mrs Bell and her husband and Mr Graham other than those involving the land. Indeed, as I have said the Statement of Claim filed with the Originating Motion sought repayment of an alleged debt from Mr Graham (which claim was abandoned in the course of the hearing of this proceeding). An affidavit sworn by Mrs Bell's solicitor, Mr Misso, on 26 August 1989 and filed in support of the summons on Originating Motion states:

"In approximately 1984, the First Defendant's company, Vitreous Plastic Engineering ("the Company"), was experiencing financial difficulties. The First Defendant requested the Plaintiff's permission to take out a mortgage facility using the beach house as security. Furthermore, as the Plaintiff's husband ("Don") was working for the First Defendant, the First Defendant advised Don that he would have to reduce his wages by half, to $245,00 gross per week or $200.00 net per week as the First Defendant could not afford to continue to employ him at the level of payment. In substitution for the rest of his wages, the First Defendant informed the Plaintiff that her and Don could draw on the mortgage facility at the rate of up to $200.00 per week as a substitute for Don's wages from the company. Unfortunately, in about 1992, the Finance Company which lent the $60,000 mortgage, being Franjeff Nominees Pty Ltd, foreclosed on the mortgage. The Plaintiff made a payment of $30,000.00 on behalf of the First Defendant's debt as the First Defendant had only made a part payment of $30,000.00. The Plaintiff also claims that in addition to the $30,000.00 paid on behalf of the First Defendant for the debt owing, there are other items that were either paid on behalf of the First Defendant or debts that the First Defendant owes to the Plaintiff and Don. These are as follows: a) $4,000.00 paid by the Plaintiff for her husband's air travel for the Company's business. The First Defendant was to repay the Plaintiff but never did. b) $11,000.00 being long service leave for Don when he retired from the Company in November 1994. The Plaintiff advises that her husband is owed long service leave from July 1967 to November 1994, a leave entitlement of approximately 18 weeks. c) $600.00 being the amount owed by the First Defendant to the Plaintiff for Vinyl Sleeves for machinery which the Plaintiff prepared for him. d) $213.00 being the fee on the discharge of mortgage." That affidavit was tendered in evidence without objection. However , it did not establish the true position beyond doubt. For example, it is unclear who was the actual borrower. The mortgage was not put in evidence.

The evidence which is said to support Mrs Bell's contention that her repayment of half of the mortgage was by way of payment in respect of Mr Graham's interest in the land is most unsatisfactory. There is no relationship between the sum paid and the value of the interest held by Mr Graham. By my calculation Mr Graham's interest, valued at the date of the death of his mother and at the time Mrs Bell and her family took possession of the land, was valued at $26,667. In September 1990 Mr Graham was paid $12,550. However, it is now suggested that the sum of $30,251.48, which was paid by Mrs Bell in 1990 in discharge of the mortgage, extinguished Mr Graham's interest in the land.

In the course of final submissions Mr Testart of counsel for Mrs Bell stated:

"I make this concession straight away, that there was no binding contractual arrangement between the parties, whether it was oral or written."

That concession was well made as the evidence is clearly to that effect. However, Mr Testart submitted that I should accept that the repayment of half of the mortgage over the land in 1990 by Mrs Bell is "evidence of a payment for the benefit of or on behalf of, or to the credit of her, in respect of her brother's interest in the property at Somers."

"must have known the assumptions upon which the plaintiff was working when he accepted the $12,550 and when he acquiesced in the payment out by her of ..... half of the mortgage over the property."

Mr Testart stated that he relied upon Waltons Stores (Interstate) Ltd v Maher [1988] HCA 7; (1988) 164 CLR 387 and submitted that Mr Graham "could not be seen .... to be relying upon legal rights in circumstances where .... (Mrs Bell) has acted to her detriment, pursuant to an arrangement which she has assumed is in place".

Insofar as this submission is based upon the doctrine of equitable or promissory estoppel, it is misconceived. First, there is no evidentiary basis to find that Mrs Bell at the time of making the payment of half the mortgage over the land in November 1990 assumed that that payment was made for or on behalf of Mr Graham and was made in respect of, Mr Graham's interest in the land. Secondly, there is no evidence that Mr Graham induced Mrs Bell to make any such assumption. Indeed, the evidence is to the contrary. There was evidence before me that the payment was made by Mrs Bell in respect of an obligation she had herself. A letter dated 8 November 1990 from her Accountant Andrew McKenzie to her was tendered before me by Mr Testart on behalf of Mrs Bell. That letter stated (omitting formal parts):

" I advise that the Franjeff Mortgage has been called up.

I have received a substantial cheque from Peter which repays half the capital and half the arrears of interest.

You will be aware that Peter, Christine and you are jointly responsible for repayment of the debt. However, I understand that there may be an agreement between you that you will repay the other half.

I enclose a statement of the sum presently outstanding. Regretably (sic) Mrs. Jeffrey has now become impatient with the situation and I would ask that you would attend to payment of the balance outstanding within the next 14 days.

Should you wish to discuss the matter with me or have any queries, please do not hesitate to contact me as soon as possible."

It appears that not only did Mrs Bell not challenge that letter, but that she acted in accordance with it. Furthermore at all material times up until the original date of the hearing of this proceeding in February 2000, the evidence is that Mr Graham asserted that he retained an interest in the land. I have already referred to his assertion of such interest in documents filed in the Family Court proceedings. However, in addition to those assertions the evidence is that Mr Graham wrote to Mrs Bell's husband on 9 December 1994 and 31 July 1995 asserting a continuing interest in the land. The letter of 31 July 1995 (in apparent response to a claim by Mrs Bell's husband for payment of a debt allegedly owed to him) states:

"If you were at this time to pursue your claim as you have threatened to do and endanger the very existence of the company then I will be forced to obtain additional funding through the sale of the house at Somers, I understand that court approval for this would be forthcoming. As you know, I have for various sentimental and family reasons been reluctant to do this even though I have not had the benefit of either the house or use of the money for nearly 10 years now. It would be stupid of me to deprive myself of the few remaining assets I have left in preference to one which is of no use to me. I don't want to have to deprive your family of the use of Somers, that has never been my want, but unless you are prepared to wait until I have the money then this would be my only alternative."

Moreover,, in a letter dated 2 December 1998 addressed "to whom it may concern" and tendered in evidence before me on behalf of Mrs Bell, Mr Graham stated:

"This is to acknowledge that Deirdre Lucille Bell - (sister) under the terms of the last will and testament of our father ...in or about January 1987 exercised her first right option to purchase the property known as 28 Ocean View Crescent, Somers in the State of Victoria at a price to be determined, and paid to me on or about September 1990 the sum of $12,550 as part payment towards that purchase."

Thirdly, there is no evidence before me to establish that Mrs Bell acted or abstained from acting in any way upon any assumption that having made the payment, Mr Graham's interest in the land had been extinguished. She took no step towards transferring his interest to her on title, nor did she take any step to assert any right over his interest in the land until well after Mrs Graham placed a caveat on the title to the land. Fourthly, there is no evidence at all before me to the effect that Mr Graham knew or intended Mrs Bell to assume his interest in the land had been extinguished by payment of half the mortgage.

The evidence before me is to the effect that Mrs Bell repaid half the mortgage. However, the evidence as to the circumstances under which the mortgage came into existence is far from clear. Even if it could properly be said that Mr Graham is indebted to Mr and Mrs Bell in a sum of money which is, or includes the amount paid by her in repayment of half the mortgage, I am unable to say, on the evidence before me, that there is any sound basis to say that the payment of such sum was in satisfaction of Mr Graham's interest in the land.

I am, as I have said, satisfied that from the time of the death of their mother in 1986, it was the common intention of Mrs Bell and Mr Graham, that Mrs Bell and her family would occupy the land and that she would acquire his interest in it on payment of the value of that interest. I am satisfied that the property had a value of $80,000 at that time and that the value of Mr Graham's interest was then $26,667. I am satisfied that Mrs Bell paid $12,550 to Mr Graham in September 1990 on account of his interest in the land. However, except for that payment I am not satisfied on the evidence before me that any other sum was paid by Mr Bell to Mr Graham on account of his interest in the land. There is thus no basis upon which I may find that there exists an equitable estoppel or other grounds which extinguish Mr Graham's entire interest in the land. It follows that there is no proper basis upon which I am able to make the declaration sought by Mrs Bell that the first defendant, Mr Graham, has no interest in the land.

Having determined to remove the caveat lodged by Mrs Graham on the grounds that she has not established a caveatable interest, it follows that she has no existing interest in the land. However there is no necessity to make the declaration sought against her that she has no interest in the land. It is sufficient to order the removal of the caveat.

Accordingly I propose, as I have stated, to order that the caveat placed upon the title to the land by Mrs Graham be removed subject to the stay I have mentioned. The order for removal would normally be directed to the Registrar of Titles. The Registrar is not a party to these proceedings. However, by virtue of section 103 of the Transfer of Land Act an order may still be directed to the Registrar. In case this should cause any difficulty I will reserve liberty to apply. I do not propose to make the declaration sought by Mrs Bell.

It is clear that the determination of the issues presently before me cannot resolve those Family Court issues between Mr and Mrs Graham and which may indirectly affect Mrs Bell. For this reason and because of the unsatisfactory state of the pleadings, and the unsatisfactory state of the submissions made before me, I consider it appropriate to set out in summary a number of findings of fact which I have made in the course of this judgment. I hope that by doing so I will assist the parties to resolve their differences and if not, I may assist others who in the future, may be required to decide issues relating to the land.

I am satisfied, notwithstanding that Mrs Bell did not become entitled to any option to purchase the land pursuant to the will of her late father, that Mr Graham and Mrs Bell had an understanding that she would acquire his interest in the land. I am satisfied this understanding enured at least from the time of the death of their mother in 1985, if not from the date of death of Mr Graham senior. However, it is also regrettably apparent that no agreement was ever reached between Mrs Bell and Mr Graham as to the price to be paid by Mrs Bell to Mr Graham or as to the terms of any payment. The land was valued at $80,000 by Union Fidelity Trustee Company as at 20 August 1985. On 30 March 1989 Mrs Bell obtained a valuation from the Balnarring office of Roy Satchwell & Co estate agents in the sum of $85,000 to $86,000. If this valuation was correct the interest of Mr Graham in the land at that time was valued at approximately $28,500. Somers Real Estate Pty Ltd estimated the value of the land on 28 September 1989 to be $92,000. If this valuation was correct the value of Mr Graham's interest in the land at that time would have amounted to approximately $30,667. Another estate agent, John Heffernan estimated the value of the land at that time to be approximately $90,000.

It is apparent that Mrs Bell commenced in 1990 to take active steps to acquire the interests of her brother and sister in the land. In March 1990 she obtained legal advice as to her position from solicitors Carey Scanlon and Warren. She paid her sister a further $15,000 on 31 April 1990 (making a total payment to her of $27,555 as at that date). Mrs Bell paid Mr Graham $12,550 on 12 September 1990. No contemporary documentation relating to this latter payment was produced before me. However, I accept Mrs Bell's evidence that this was paid in part payment of Mr Graham's interest in the land. Doing the best that I can on the evidence before me, I accept that the land was at that time valued at $92,000. I accept that Mr Graham accepted the payment of $12,550 in reduction of his interest in the land. As he said in his affidavit sworn 19 March 1996:

"...it was the intention of Deirdre, Christine and I that Deirdre acquire a full interest in the holiday house. In about 1990 Deirdre paid Christine and I $12,550 each, and I estimate my remaining interest in the said property at present at approximately $20,000."

This statement is consistent with Mr Graham accepting that the payment of $12,550 reduced his interest in the land to below 33-1/3% and is also consistent with his acceptance that the value of the land at the time of the payment was in the order of $92,000.

If the value of Mr Graham's 1/3 interest was $30,664 at that time then a payment of $12,550 reduced that interest to 19.68%. I would conclude that he has a 20% interest in the land.

I turn now to the issue of costs. Mrs Bell has succeeded in obtaining the removal of the caveat. However, she has failed in respect of her claim that Mr Graham has no interest in the land. Mrs Graham's claim to an interest in the land is really a derivative claim, depending upon what decision is made in the Family Court proceedings. To that extent she has had some measure of success. In all the circumstances, in the exercise of my discretion I propose that costs should lie where they fall and that I should make no order as to costs.

1. Pursuant to section 103 of the Transfer of land Act the Registrar of Titles is ordered pursuant to section 90 (3) of the Act to remove caveat No V188530W from the land described in Certificate of Title Volume 7586 Folio 062 at the expiration of 14 days after 10 May 2000.

2. The plaintiffs claim in the Originating Motion herein is otherwise dismissed.

3. The plaintiff forthwith serve a copy of this order when authenticated on the Registrar of Titles.

4. Liberty to apply is reserved to each of the parties on 48 hours written notice to the others.

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