Chao v Chao

CATCHWORDS : TRUSTS - EXPRESS TRUSTS - common intention - RESULTING TRUSTS - where house purchased in name of defendant brother who borrows part of purchase price - where plaintiff sister provides deposit, stamp duty and part of the purchase price - where plaintiff resided in property rent-free and paid rates, maintenance, repairs and improvements - where defendant paid land tax - where defendant made statutory declaration in aid of plaintiff's residency application that plaintiff was the owner - where plaintiff repaid mortgage principal - whether there was a common intention that the house was to be purchased on trust for the plaintiff - whether presumption of resulting trust resulted - whether plaintiff had reimbursed the defendant's expenditure - whether plaintiff or defendant liable for further advance on home loan account to pay $190,000 to parents - where defendant drew on home loan account to purchase a new Ferrari - whether plaintiff consented to the defendant's purchase of Ferrari

LEGISLATION CITED : (CTH) Statutory Declarations Act 1959

Bertei v Feher [2000] WASCA 165 Bloch v Bloch (1981) 180 CLR 390 Brown v Brown (1993) 31 NSWLR 582 Calverley v Green (1984) 155 CLR 242 Charles Marshall Pty Ltd v Grimsely (1956) 95 CLR 353 CASES CITED : Currie v Hamilton [1984] 1 NSWLR 687 Dinsdale bht Protective Commissioner v Arthur [2006] NSWSC 809 Napier v Public Trustee (1980) 32 ALR 153 Ryan v Dries [2002] NSWCA 3 Shephard v Cartwright [1955] AC 431 Stockbridge v Lupton (NSWSC, McLelland J, 14 March 1999, unreported)

PARTIES : Ping Jung Chao (plaintiff) Sheng-Chun Chao (defendant)

COUNSEL : Mr J B Simpkins SC (plaintiff) Mr N G Ford (sol) (defendant)

SOLICITORS : Helen Sin Legal Pty Ltd (plaintiff) Brischetto & Ford Solicitors (defendant)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION EXPEDITION LIST

4398/07 Ping Jung Chao v Sheng-Chun Chao JUDGMENT 1 HIS HONOUR: The defendant Sheng-Chun Chao is the registered proprietor of 1 Horace Street, St Ives. His sister the plaintiff Ping Jung Chao claims a declaration that he holds Horace Street upon trust for her as a result of arrangements made between them at the time of, and the provision of funds by her towards, its acquisition in mid-1997; and a consequential order that he transfer the property to her unencumbered by the mortgage it presently secures. The brother cross-claims for possession of the property, but acknowledges that his sister is entitled to restitution for contributions made by her to its acquisition. The main issues are:

· What were the beneficial entitlements of the parties upon acquisition of the Horace Street property; · Who is responsible, as between the parties, for a subsequent drawdown on the mortgage of $190,000 remitted to the parties' parents in Taiwan in February 2002; · Who is responsible, as between the parties, and upon what terms, for a further drawdown on the mortgage of $492,000 applied to the acquisition by the brother of a Ferrari motor vehicle in or about March 2005. Horace Street is acquired with a home loan 2 The parties originate from Taiwan. The brother moved to Australia in 1989, initially as a student. The sister visited Australia in 1992. She formed an intention to migrate, with her husband and children. In or about early 1997, she and her brother had a number of telephone conversations in connection with this plan, in the course of which she asked him, and he agreed, to look for a property in which she and her family could live in Australia. The brother says that his sister initially proposed renting rather than buying, and that he raised the possibility of buying, following which they agreed to buy a property together - essentially, for her to live in but for him as an investment. According to the sister, it was always her intention to buy.

3 The brother told the sister that she would need to open an Australian bank account, into which she could make deposits, but which he would operate. In March 1997, the brother obtained and sent to his sister in Taiwan the necessary documents for this purpose, which she signed and returned. As a result, on 19 March 1997 account 0595 with the Commonwealth Bank of Australia was opened, in the name of the sister but with the brother as the signatory (although apparently - at least by the date of issue of the first statement on 3 July 1997 - with 1 Horace Street as the mailing address), with a deposit of $149,988 transmitted by the sister from Taiwan. On 21 March, $149,599 was re-invested from the 0595 account into a commercial bill for two months. 4 The brother found the Horace Street property, I infer from the following events on about 7 April 1997. At about this time, the parties had a further telephone conversation, in which the brother reported that he had found the property, at a price of $357,000. According to the sister, she told him to use the money in the 0595 account to pay the deposit, and that she would transmit more but that she would need to borrow $250,000, and he told her that the property would have to be purchased in his name with him as the borrower, because he was an Australian resident and she was not. According to the brother, he told her that she would need to pay the deposit, while he would borrow the balance. 5 On 8 April, the sister transmitted a further $99,992 into the 0595 account. On 10 April, the brother paid, from his own resources, a holding deposit of $1,000 on the Horace Street property. By 16 April he had approached the Commonwealth Bank for a loan and received an indicative approval. On 17 April, the Commonwealth Bank formally approved a loan of $250,000 to the brother on the security of Horace Street, and on 18 April 1997 contracts for the purchase of the property were exchanged, in which the brother was the named purchaser; the balance deposit of $34,750 was withdrawn from the 0595 account. On 5 May, the sum of $11,581.50, being the whole of the stamp duty payable, was also debited from the 0595 account. The contract was completed on 30 May 1997, with a sum of $250,600 advanced by the Commonwealth Bank on the security of Horace Street on Home Loan account 4201 in the name of the brother, and balance purchase money of $71,791.16 which had been, on 29 May 1997, withdrawn from the 0595 account.

6 On 2 June, the sister deposited a further $69,988 into the 0595 account. The first commercial bill had matured on or about 21 May, and on 2 June the sister reinvested $140,000 in a commercial bill. On 12 June, $13,000 was withdrawn from the 0595 account, of which $9,880 was used to open another account - number 3251 - in the sister's name, with the brother as a signatory but 1 Horace Street as the mailing address. On 23 June, the sister deposited a further $29,992 into the 0595 account, which was withdrawn (in the sum of $30,140.75) on 25 June. As a result of these and some other minor transactions, following completion of the purchase, the sister retained in Australia as at 28 June 1997 a commercial bill of $140,000, cash in the 0595 account of about $50,000, and cash in the 3251 account of about $11,000. 7 The sister arrived in Australia on 28 June 1997 and took up occupation in the Horace St property. The 0595 account was closed on 3 July 1997, when $10,000 was transferred to the brother's account, and $40,000 to the 3251 account. On 4 July 1997, the sister reinvested the proceeds of the commercial bill, which she continued to roll-over until after she obtained permanent residence in September 2001.

8 The home loan was serviced by periodical payments made by direct debit from the brother's Commonwealth Bank Streamline account number 6625. The Home Loan account statements, in the name of the brother, were originally addressed to him at 1 Horace Street, but the mailing address was changed to his Pymble Post Office box sometime in the first half of 2000. The sister says, but the brother denies, that in about June 1997 she told him on the telephone that he could reimburse himself from her account for the monthly mortgage instalments and other expenses that he incurred in relation to the purchase. The sister paid the rates, and for maintenance repairs and improvements. The brother paid the land tax each year.

9 The sister alleged that, between 24 June 1997 and 26 April 2000, withdrawals that she identified totalling $76,161.07 were made from the 3251 account, presumably by the brother in reimbursement of mortgage repayments. However, a more accurate description is that she denied having authorised them and said she did not know for what purpose they were made.

10 The sister wished to obtain permanent resident status for herself and her family in Australia, and the brother assisted her in this endeavour. The process was initiated as early as December 1996, when solicitors were instructed. However, her first application was rejected, on 23 July 1999, when she was notified that she would have to leave Australia within 35 days. She then made a further application, using the services of Jill Chew, Migration Agent, in connection with which the brother made a statutory declaration on 29 August 2001, in which he deposed that the sister was the owner of Horace Street, that he had assisted in its purchase as she was not then in Australia, and that he had no claim to or interest in the property. 11 On 24 September 2001, the sister was granted permanent residence, and on 23 November 2001, her commercial bill matured and she paid $180,000 from its proceeds off the home loan, leaving a balance outstanding of $24,636.88. On 19 February 2002, she paid a further $21,000 off the home loan - she says after speaking to her brother to ascertain what was the outstanding balance - which, but for the redraw about to be mentioned, would have completed repayment of the loan.

12 In the meantime, however, $190,000 had been redrawn from the home loan account and paid to the parents in Taiwan, in circumstances that are in dispute. 13 In or about January 2002, the mother visited Australia and stayed with the sister in the Horace Street property. The parents' version - they were called by the sister - was that in the early 1990s, they had lent the brother $160,000 at his request, which they raised by borrowing on the security of their own home in Taiwan, to help him establish his business; that in early 2002, their and his relative circumstances were such that they considered that he should repay them; that while she was in Australia the mother requested that he do so; and that the $190,000 they then received was understood by them to be a repayment by their son of the debt he owed them. 14 The brother's version is that the mother, in the course of her visit, told him that she needed money (for what he called "a gambling habit"), which he refused to give her; that the following day, the sister spoke to him and said that she wanted to draw $190,000 from the home loan account "to save our parents' lives and house", to which he responded "It is up to you"; that later the same day, he and his sister argued over the proposed withdrawal, but he concluded "It is not a problem, it is up to you because you just put in $180,000"; and that he then made the transaction at the Pymble branch of the Commonwealth Bank, in his sister's presence.

15 The sister says that while her mother made some passing reference to her financial circumstances, she had no prior knowledge of and did not authorise the $190,000 transaction, and did not learn until some months later that it was drawn down from the home loan account. I shall have to return in greater detail to the evidence surrounding this.

The home loan funds a Ferrari 16 From time to time, the sister returned to Taiwan. One such occasion was in September 2004, following which she returned to Australia in March 2005, whereupon she became aware that her brother appeared to have a new Ferrari motor vehicle. She says that she did not then suspect that he had financed it by (as was the case) borrowing against Horace Street. However, the brother says that he had discussed with her his proposal to purchase a Ferrari before her departure; that in March 2005 he told her that he had borrowed against the property to acquire the Ferrari and asked her if that was okay; that she agreed, but insisted that the advance should be repaid as soon as possible; and that she drove him and his domestic partner Mr Ford into the William Street City Ferrari dealership to collect the vehicle (an allegation which Mr Ford corroborates, but the sister disputes). Again, I shall have to return to this matter.

The relationship breaks down 17 The brother operated a company called One Stop DJ Equipment & Records Pty Ltd ("One Stop DJ"), of which the brother and sister were shareholders, directors and employees. In April 2006, a joint account with the Commonwealth Bank (number 7525) was opened, in the name of the brother and the sister, into which the sister's wages were deposited from April 2006 (when she went to Taiwan) until July 2007 (although she had resigned her employment in March 2006 in anticipation of her return to Taiwan). The brother says (and the sister did not deny) that this account was established so that, while she was overseas, her "wages" would be available to him, for the purposes of maintaining the company motor vehicle of which she had the use, and supporting her daughter Vivien who remained in Australia. A total of approximately $25,000 was deposited by way of the sister's "wages" into the 7525 account. The brother also deposited into it additional moneys of his own. Substantially the whole amount deposited on behalf of the sister was withdrawn, and applied apparently in reduction of the Horace Street mortgage. 18 According to the sister, in a telephone conversation in December 2006 she asked her brother to transfer the Horace Street property into her name; he replied that he could not do so, as he had borrowed against it in order to buy his Ferrari, but suggested that he might borrow another $357,000 (equivalent to the original purchase price of Horace Street), and pay it to the sister so that she could purchase elsewhere. The brother agrees that there was a telephone conversation about the property, but says that he told her that he wanted to sell the property as she no longer needed his assistance, but she did not agree.

19 From then, the relationship deteriorated. In July 2007, the sister was, without her knowledge, removed as a signatory to accounts of One Stop DJ, notwithstanding that she was a director and shareholder -- she did not learn of her removal until November 2007. On 3 August 2007, the brother's solicitor wrote to the sister, asserting that she was a tenant at will of the Horace Street property (in which she had lived since 28 June 2007, and had paid the rates and for improvements, and had never been asked for any occupation fee) and demanding that she vacate it, although offering to reimburse any contribution she had made. On 30 August 2007, One Stop DJ sold its business; there was no communication between the parties in respect of this, and the sister says she remained unaware of it until late 2007 or early 2008.

20 The sister filed her summons in these proceedings on 4 September 2007. When she discovered that she had been removed as a signatory from the company accounts, she wrote to the bank, with the consequence that the company's account was frozen. Telephone conversations took place between the parties on 15 December 2007, which the sister recorded: she says that her brother threatened to auction the property the following month.

Did the 1997 arrangements give the sister beneficial ownership? 21 The first and foremost issue is, what was the substance of the arrangements and dealings between the parties in 1997, and in particular were they such as to confer beneficial ownership of Horace Street on the sister - whether pursuant to a common intention express trust, or a resulting trust. 22 Where two or more parties provide the purchase money for property acquired in the name of one of them, they are presumed to intend to take beneficially in shares according to their proportionate contributions to the purchase money, and the nominal owner(s) will hold upon trust for those who provide the purchase money in those shares [Calverley v Green (1984) 155 CLR 242, 246 (Gibbs CJ), 258-9 (Mason and Brennan JJ), 266-7 (Deane J)]. For those purposes, the purchase price includes the costs, fees and disbursements incidental to the acquisition of the property [Ryan v Dries [2002] NSWCA 3, [52]-[53]]. This presumption of a resulting trust is, however, rebuttable: it will yield to a contrary common intention of the parties, though it is not displaced by slight circumstances [Napier v Public Trustee (1980) 32 ALR 153, 158; Shephard v Cartwright [1955] AC 431, 445; Charles Marshall Pty Ltd v Grimsely (1956) 95 CLR 353, 365; Brown v Brown (1993) 31 NSWLR 582, 596; Dinsdale bht Protective Commissioner v Arthur [2006] NSWSC 809, [11]]. 23 In this context, where part of the purchase money is provided by a loan raised by one of the parties, that part is ordinarily regarded as being contributed by the borrower, who is liable to repay the loan, regardless of who actually services or repays it - although if one repays in whole or in part the other's loan, that may give rise to a right of contribution or a liability to account between them [Calverley v Green, 251 (Gibbs CJ), 257-8 (Mason and Brennan JJ), 267-8 (Deane J); Dinsdale, [11]]. However, that is not invariably the case; the making of cash contributions by the parties may show that the asset which they intended to acquire was not merely the mortgaged land but the unencumbered land, in which case their contributions to mortgage payments may tend to show that they intended the whole of their respective contributions, including to mortgage repayments, to furnish the measure of their respective interests [Bloch v Bloch (1981) 180 CLR 390, 402 (Brennan J); Currie v Hamilton [1984] 1 NSWLR 687, 691 (McLelland J); Stockbridge v Lupton (NSWSC, McLelland J, 14 March 1999, unreported)]. In particular, where finance is raised as "bridging finance", it may be artificial to say that the money raised under the temporary facility, rather than the ultimate source of funding, is to be treated as the relevant contribution [Bertei v Feher [2000] WASCA 165, [43]-[44]].

24 In this case, the purchase moneys of $357,000 for Horace Street were provided, as to $251,600, by the brother (being the holding deposit of $1,000, and the mortgage moneys of $250,600), and as to $117,581 by the sister (being the balance purchase money of $106,000, and $11,581 paid for stamp duty). Accordingly, were the presumption of a resulting trust applicable, and the loan moneys treated as the brother's contribution, the brother would hold Horace Street upon trust for himself and the sister in proportions 251:117, or 68%:32%. However, the sister's contributions to the mortgage repayments (in particular, the two capital repayments of $180,000 and $21,000, together with any other reimbursements she might have made of instalment payments made initially by the brother) would entitle her to an account against the brother for those amounts.

25 Does the presumption yield, in this case, to a contrary intent? The answer depends upon the arrangements made between the parties at the time of purchase; although their subsequent conduct and its consistency or inconsistency with the competing versions of those arrangements may bear on the assessment of which is the more likely version. 26 The sister's version was that Horace Street was always to be her property; that the home loan - although obtained in the brother's name - was in truth her loan, for which (as between the parties) she was ultimately responsible; and that she is exclusively beneficially entitled to the property. The brother's version became (although not originally so expressed in his affidavit, at least in any detail) that although there was no express agreement as to their proportionate interests, or in what circumstances the property might be sold, or whether an occupation fee would be payable, the property was to be beneficially owned by both of them, but held in his name for foreign investment reasons, in which respect he was "helping her"; that originally he was to contribute 90% and she 10% of the purchase price; but that he discovered that he was unable to borrow more than $250,000 and she agreed to contribute the rest (although he could recall no conversation in which she did so). Where, on the probabilities, does the truth lie? 27 A number of matters have been, and may be, said in favour of the sister's version and against that of the brother. First, what in fact happened - in that the property was purchased in the name of the brother but occupied by the sister free of charge or occupation fee - is consistent with the sister's version. However, it is not inconsistent with the brother's version, and so does not tell significantly one way or the other.

28 Secondly, it is at least clear that the sister paid the deposit, 100% of the stamp duty, and the unfunded balance purchase price of $71,792 (that is, the difference between the deposit and the amount of the home loan). While her payment of the deposit is consistent with both versions, the rest is consistent only with the sister's version: the brother's version does not explain how his sister came to make any payments other than the deposit, and he offered no account of any conversation about them. He claimed to have investment funds of $50,000 available, yet he did not contribute them, and he was unable to advance any satisfactory explanation of how, consistently with his version, it came about, in those circumstances, that his sister paid the whole of the stamp duty and the unfunded balance purchase price. He was unable to recall any detail of the essential conversations; in particular, he gave no evidence of any conversation in which the sister agreed to increase her contribution above the 10% he claimed was initially agreed. Although it is unsurprising in these types of arrangements that the parties would not necessarily address what would be the respective interests of the parties in the property, the circumstances in which either or both might require sale or the circumstances under which the sister would occupy it - and I do not give weight to absence of recollection on the part of the brother of any discussion of those matters - one would expect some recollection of a discussion as to the basis on which the sister was to contribute amounts prima facie in excess of her proportionate responsibility according to his version. This favours the sister's version. 29 Thirdly, there is the payment to the brother of $10,000 from the 0595 account when it was closed, which was said to corroborate the sister's version as showing that the brother was reimbursed. But although the sister says that this was to reimburse the brother in respect of mortgage instalments and other expenses incurred by him in relation to the purchase, I am (for reasons explained below) unpersuaded, and in any event the amount was quite insufficient to cover mortgage repayments over the period until November 2001 when she paid down the loan, and as I will later explain, the evidence does not establish to my satisfaction that further payments were made to him by way of reimbursement. Accordingly, this consideration does not advance the sister's case. 30 Fourthly, there is the evidence of Mr Foenander, who was at the relevant time the domestic partner of Mr Ford, with whom the brother resided. He said that he was told by the brother that the house was being purchased for his sister - though there was no discussion as to where the money was coming from, nor any reference to the circumstance that the brother was borrowing money for that purpose - and that to his knowledge the house was the sister's, and was always referred to as such, there being no mention of the brother having any interest in it. While I do not think that Mr Foenander had detailed knowledge of the circumstances, his evidence tells somewhat in favour of the sister's version. 31 Fifthly, there is the evidence of the parents. Both were adamant that Horace Street was the sister's property, and accused the brother of "stealing" her property. However, the source of their knowledge or understanding is unexplained, and there is no evidence of any participation by them in the 1997 arrangements, or even that the sister made relevant contemporaneous statements to them. In those circumstances, I am unable to give their very strongly held and expressed views on this topic any weight. 32 Sixthly, there is the circumstance that on 29 August 2001 the brother made a statutory declaration in connection with the sister's immigration application, in which he declared that the sister was the owner of Horace Street, that he had assisted in its purchase as she was not then in Australia, and that he had no claim to or interest in the property. After the institution of these proceedings, the sister sought to interrogate the brother in respect of that declaration. He did not cooperate, and on 5 November 2007 she filed a motion, claiming an order that he answer relevant interrogatories; over his opposition, that order was made. Meanwhile, on 22 November 2007, the sister had served on the brother a notice to admit facts. In a notice disputing filed on 3 December 2007, the brother did not admit that he declared the statutory declaration; admitted that his signature appeared on page 2 of the document, but otherwise did not admit that his signature appeared on the statutory declaration; denied that his signature was written on it in the presence of Ms Chew; did not admit that Ms Chew was a Justice of the Peace or held the relevant registration number as such; save for admitting that his signature appeared on page 2, did not admit that the statutory declaration was declared by him pursuant to the (CTH) Statutory Declarations Act 1959; did not admit that the statutory declaration was declared by him for the purposes of a law of the Commonwealth or Territory; did not admit that the statutory declaration was declared by him in connection with any matter arising under a law of the Commonwealth or Territory; did not admit that in the document it was stated that the sister was the owner of Horace Street; denied that she was the owner of Horace Street; did not admit that she and her family had been residing at Horace Street between 28 June 1997 and 29 August 2001; and did not admit that they had been residing there between 29 August 2001 and 22 November 2007. Furthermore, he disputed the authenticity of the statutory declaration.

33 On 14 December 2007, he verified his answers to interrogatories, asserting that the signature on page 2 of the statutory declaration was his, and that he signed the original on or about 29 August 2001 at the offices of Ms Jill Chew & Associates, migration agent, Floor 7, Suite 721, 368 Sussex Street, Sydney, in the following circumstances: The second page of the document was signed by me in the course of assisting my sister, the plaintiff with an application to the Department of Immigration. I did not read page one of the document. It was not read to me by anyone. At the time I was signing many documents with the migration agent and she pointed to a number of yellow stickers with red arrows in a bundle of papers for me to sign, turning each page and pointing to the place where I had to sign. 34 Jill Chew, who gave evidence in the sister's case, could remember the brother attending before her to make the statutory declaration, though she had no recollection of the actual words of any conversation. She said that it was her practice either to read over a statutory declaration to a declarant or to ensure that the declarant read it. From her and other evidence, it emerged that (contrary to his answer to interrogatories) the brother was not then signing any other documents with Ms Chew, and it is impossible that (as he had asserted in his answer to interrogatories) she pointed to a number of yellow stickers with red arrows in a bundle of papers for him to sign, turning each page and pointing where he had to sign. Moreover, she said that the source of the relevant information in the statutory declaration was the brother (although it has to be said that it took some prising to elicit that from her; I think she was probably reluctant to be seen to favouring the case of one party over the other). 35 In cross-examination, the brother said that Ms Chew suggested the inclusion of the relevant matters in the statutory declaration, including that he ought to state that her sister was the owner of Horace Street: Q. She suggested to you, did she, that you ought to state that your sister was the owner of 1 Horace Street? A. Yes. Q. You told her that you would make a declaration to that effect? A. I did not say I will. She suggests she will make, she had - she have to make a statutory declaration. I did not discuss each sentence with her. She suggested the whole thing. I didn't say yes. Q. Whether she discussed the whole thing with you, you agree, don't you, that you had a conversation with Ms Chew before you made the declaration where you agreed that you would state that your sister was the owner of 1 Horace Street St Ives? A. I perhaps have. Q. And you had a conversation also, didn't you, with Ms Chew where you told her that you had assisted your sister in her purchase of that property because she was not an Australian? A. I didn't tell her, she suggests, and I - anyway she suggests. I did not discuss individual in detail with her. Q. You spoke to Ms Chew and told her, didn't you, before you came to make the declaration that you had no claim or interest in 1 Horace Street and that you did not propose to make any claim for that property in the future? A. I never mentioned the sentence, that's a purely she put in. I never ever discussed that sentence ever. 36 That evidence is fundamentally different from and inconsistent with the explanation that appeared in his answers to interrogatories. Moreover, the suggestion that the inclusion of the relevant material in the statutory declaration was Ms Chew's idea was never put to her (and, although it is fair to observe that her evidence that the source of the information was the brother was elicited only by questions from the bench, at the end of her cross-examination, an opportunity was then afforded to his counsel to cross-examine further; and in any event, if that were his explanation for the statutory declaration, which was an obviously crucial aspect of the evidence, one would have expected it to be put). In my view, his inconsistency and evasion on this matter tell strongly against the brother's version on the arrangements in respect of Horace Street in particular, and on credit generally. Moreover, the terms of the Statutory Declaration tell in favour of the sister's case, including not only that the property was hers and that he had no claim to or interest in it, but also, significantly, that the reason for his involvement in the purchase was that the sister was not then in Australia consistent with his having told her, as she contended, that the property would have to be purchased in his name because he was an Australian resident and she was not. 37 Seventhly, while the evidence as to whether or not the sister contributed indirectly to the periodical mortgage instalments paid by the brother is faint, it is at least clear that she paid a total of $201,000 by way of principal reduction. Having retained a capital sum invested in Australia (in commercial bills) until she obtained permanent residence, she applied the proceeds of $180,000 to reduction of the home loan on 23 November 2001, and then made a further capital repayment of $21,000 on 19 February 2002 which, but for the drawdown of $190,000, would have discharged the home loan. Why she would have done this, unless referable to an intent and understanding that she was ultimately liable for the home loan and beneficially entitled to the property, is inexplicable. Her version (that she obtained the payout figure from her brother in February 2002) is corroborated by the circumstance that he acknowledged that it was in his handwriting that two sets of figures, corresponding with the outstanding balance of the home loan as at 21 January and 4 February 2002, appeared on an envelope that the sister had earlier said she received from him in about February 2002, containing a facsimile letter from the father to the brother. Against that, the brother's evidence on this matter is unconvincing. At first, he said that there was no discussion before the $180,000 payment, but he then said that, in response to his sister's statement that she wanted to pay off the home loan, he answered "It's up to you", but did not discuss why she wanted to do so - although he "did not understand it at all". He accepted that he made enquiries to obtain the payout figure in early 2002 - he said in the context of his sister saying "I want to deposit money" and him responding "Okay" - but again, remarkably, with no discussion about why she was doing so. 38 As has been pointed out, the brother apparently obtained the outstanding balances of the home loan from the bank statement, and recorded them on an envelope that was handed to his sister. He permitted his sister to act in the belief that she was discharging the whole of the loan - inconsistently with his contention that it was a liability for which she had no responsibility. He offered no explanation for these principal repayments, other than a suggestion that it was part of a devious plan to claim a beneficial entitlement and deprive him of any interest. But that is an improbable explanation: the theory that this was some devious scheme by the sister is a very unlikely one, as in circumstances where the brother had already made the statutory declaration, it is difficult to see why the sister needed to pay off the home loan to advance her claim to a beneficial interest. The far more probable explanation is that the brother understood his sister to be making the capital repayments referable to an understanding that as between them she was ultimately responsible for the home loan. This consideration, therefore, tells in favour of the sister's version.

39 Eighthly, the brother in 2000 acquired another house (at Curagul Avenue, St Ives) in his own name with Mr Ford, who had become his domestic partner. Although this might be a curiosity if in fact he was already beneficially entitled to 1 Horace Street, there are other possible explanations and I give it little significance. 40 Ninthly, it is plain that the brother made transfers from the joint 7525 account to the home loan in reduction of the home loan. When this was put to him, he explained it on the basis that the account was in truth his, into which his sister's wages were deposited while she was absent in Taiwan on the basis that he could use them to cover her motor vehicle expenses and maintenance of Vivien. This explanation is not irreconcilable with his affidavit version, and I therefore attribute little significance to this factor.

41 Tenthly, there is the brother's finance application in connection with his acquisition of the Ferrari. The bank manager's notes contain an initial entry recording that the brother was "giving the security property to his sister". The manager directed a further inquiry as to whether he was giving the property to her, or letting her occupy it rent free, and a later entry records that he was letting it to her without charge. While this to some extent detracts from the significance of the first entry, even it is inconsistent with the claim he now propounds for an occupation fee. 42 There are also a number of matters that have been or could be said in favour of the brother's version and against that of the sister. First, it was he who undertook liability to the bank, his creditworthiness that was assessed, his account that was debited with the loan, and he who was liable on default; his sister was unexposed to liability to the bank. However, while at first sight this has some force, it is not inconsistent with the sister's version - if, as she says (as did his Statutory Declaration), the property was acquired in his name because he and not she was an Australian resident at the time. Moreover, the brother said that his sister told him that she did not have enough funds to acquire the property, but this is very unlikely; with his knowledge, in the first half of 1997 she deposited into the 0595 account, which he then controlled, a total of $350,000. The sister's version was that she was not going to contribute more than the $117,000 at the outset and preferred to borrow as much as she could rather than contribute capital - despite having another $280,000 approximately available, she retained the additional capital in the form of commercial bills rather than reducing the amount borrowed. This was said to tell against the sister's version, as it made little sense for her to incur the costs of borrowing if she had the capacity to fund the purchase without borrowing, and suggested that she was reserving her position until the outcome of the permanent resident application, on the basis that she would not commit to the property unless her application succeeded. But while, given the costs of borrowing, and the availability of additional capital which she could have applied to the acquisition of Horace Street rather than borrowing, this appears at first sight a curious approach if she intended to be beneficially entitled, it is readily explicable by the circumstance that she wanted to preserve assets in her name in Australia in support of her immigration application and did not then understand that she could for that purpose claim a beneficial interest in real property held in her brother's name. The explanation that the commercial bills were retained pending the outcome of her permanent residency application, in order to demonstrate that she had assets in Australia, at a time when it was not appreciated that a claim to a beneficial interest in Horace Street which was not in her name might serve that purpose, is very plausible. Contrary to the submissions on behalf of the brother, I do not consider that there is any particular curiosity in the sister not paying off the home loan until after her permanent residency application succeeded. At least as she then understood the position, to qualify for permanent residence, she had to be able to demonstrate that she held a certain level of assets in Australia; reduction of the mortgage on land held in the brother's name would not apparently have done that, and there is no suggestion that before about August 2001 she was aware that her interest in Horace Street might be established by statutory declaration. Ultimately, this consideration does not significantly advance the brother's credit or case.

43 Secondly, it is unquestionable that the home loan was serviced until November 2001 by direct deposit from the brother's separate bank account, with a total of approximately $77,000 being paid in that manner until January 2002. However, this is not inconsistent with the sister's version - particularly if, as she says, she authorised her brother to reimburse himself from her account. 44 Thirdly, the brother paid the land tax in respect of the property. However, again, that is not inconsistent with the sister's version, particularly if he was authorised to reimburse himself in respect of such payments.

45 Fourthly, the sister's evidence attributing payments from her 3251 and the joint 7525 accounts as being by way of reimbursement of her brother for mortgage instalment payments is demonstrably (and now admittedly) wrong in some respects, as explained later. However, I think these errors were the result of erroneous reconstruction or assumption on the part of the sister, of matters of which she did not have direct knowledge, rather than faulty recollection or intentional deception. 46 Fifthly, the sister's evidence was demonstrably wrong insofar as she asserted that her brother had drawn down on the home loan to repay the mortgage on his Curagul Avenue property - when in fact, the funds so drawn had been used to purchase the Ferrari. She maintained this assertion in her affidavit material for some time. However, the real position is that she did not know - and could not be expected to know - how the brother had applied those funds; and it was her supposition rather than knowledge that he had applied it to pay off the mortgage on Curagul Avenue. I do not regard this as of much significance to her reliability or credit. (As later explained, if anything it corroborates her claim to have been unaware of the use of the home loan account to fund the Ferrari purchase). 47 This issue is to be resolved according to the balance of probabilities, the plaintiff sister bearing the onus of rebutting the presumption of a resulting trust. Although I accept that the presumption does not yield to slight circumstances, in my view some of the considerations to which I have referred - in particular, the sister's reduction of the home loan principal by $201,000, the evidence of Mr Foenander, the terms of the brother's statutory declaration and his unsatisfactory attempts to evade its implications, the finance application for the Ferrari, and the paucity of the brother's evidence about the original fundamental conversations - tell strongly in favour of the probability of the sister's version. On the other hand, there is no weighty factor that favours the brother's version. I have not overlooked the possibility that there may have been a misunderstanding or lack of consensus between the parties at the time of the original arrangements, the sister believing her version, and the brother believing his. However, the statutory declaration, and the Ferrari finance application, present serious obstacles to that view, requiring acceptance of the last of the brother's various attempts to explain the statutory declaration, and the second of the versions he apparently gave the bank.

48 Accordingly, I conclude that it was the common intention of the parties, at the time of the acquisition of Horace Street, that the sister would be beneficially entitled to the property, and would indemnify the brother in respect of the home loan. The sister had the funds to buy Horace Street, and did not need her brother's financial resources to achieve that result rather than to rent. The involvement of the brother is explained by the circumstance that - at least as the parties then understood the position - the purchase would be facilitated if undertaken in the name of an Australian resident. Although she could have fully funded the purchase, the need for a loan arose because (at least as they understood it) it would assist her application for permanent residence to have funds invested in Australia, and to achieve that as well as buying the home, she would need a home loan. As the home was to be purchased in the brother's name, so too the home loan would have to be in his name. Once the sister obtained permanent residence (on 24 September 2001), at the first opportunity when the fund she had invested next rolled over (on 23 November 2001), it was applied immediately to paying down the home loan. On 13 February 2002, she drew a cheque for a further $21,000, which was deposited on 19 February - consistent with that having been the amount then required to discharge the home loan, but for the withdrawal of the $190,000 paid to the parents on 7 February 2002.

49 If, contrary to my preference on the probabilities for the sister's version over that of the brother, there was in fact no actual common intention, one must resort to the presumption. In the present case, although there may have been an understanding that the brother would obtain the home loan, the evidence does not establish any agreement or common intention that, as between brother and sister, he to her exclusion would be primarily responsible for the repayment of the home loan [cf Currie v Hamilton]. The ultimate repayments by the sister, and the absence of any protest by the brother, tell strongly against any such agreement. Moreover, they illustrate that the arrangement was one akin to bridging finance: the brother borrowed the funds, but only until the sister's became available following determination of her immigration application. Accordingly, if it were wrong to conclude that the parties had the common intention that the sister would be beneficially entitled to Horace Street (subject to indemnifying the brother in respect of the home loan), nonetheless I would regard her as having contributed the mortgage moneys, as a result of her repayment of the loan principal, but liable to reimburse the brother for the payments he made in the interim. 50 The evidence permits the amounts the brother has paid to be ascertained and determined, without having to refer the matter for a subsequent inquiry or account. The total mortgage repayments made by the brother (excluding the $201,000 paid by the sister), from July 1997 until February 2002 - when but for the $190,000 drawdown the loan would have been repaid - amounted to $121,759.95. 51 In addition to those mortgage payments, the brother has adduced evidence of other expenditure by him referable to Horace Street, totalling $46,920.82, as follows:

· Mortgage inspection report $445; · Holding deposit $1,000; · Stamp duty on mortgage $947; · Establishment fee $600; · Other post acquisition expenditure (1996/1997) $35,104.96; · Land tax (2001/2007) $8,417.86; · Rates (1997/1998) $746; · Pest inspection (2006) $220; · Termite treatment (2007) $440.

52 The brother's payments therefore total $168,680.77.

53 The sister contends that she has already reimbursed the brother for such payments, through the amounts she claims he has withdrawn from her accounts. On this, she bears the onus of proof.

54 The withdrawal from the 0595 account of $13,000 on 12 June is fully explained: $9,880 was used to open the 3251 account, and documentary evidence confirms that the balance was used to purchase kitchen fittings for Horace Street.

55 The withdrawal from the 0595 account of $30,140.75 on 25 June is unexplained by the evidence. The transaction must have been implemented by the brother, as he was the signatory to the account and the sister was not yet in Australia. He gave no explanation of it, nor was he cross-examined about it. There was a credit of $12,356.75 to the 3251 account on the same date, which is otherwise unexplained (the sister does not assert that she made a further transfer from Taiwan at that time), and probably represents part of the withdrawal. There is no evidence of the destination of the balance ($17,784). Given the proximity of the sister's arrival in Australia, and that they were then on good terms, I am unpersuaded that this sum was taken by the brother without authority, and it is probable that it was applied in connection with the purchase and fitout of Horace Street; but as the sister's evidence is that she authorised him to reimburse expenses he had incurred, and as he has offered no explanation of a disbursement which I infer was under his control, I conclude that this was by way of reimbursement, and must be set off against his claim for expenditure.

56 As to the $10,000 transferred to the brother's account when the 0595 account was closed on 3 July 1997, the sister said that this was to cover mortgage instalment payments made or to be made by him. The sum is a curious one if it were reimbursement for mortgage instalment payments as the sister claims, as it is a lump sum unrelated to the amount of such payments. The brother said (albeit only in response to a question from the bench at the end of his cross-examination) that it was reimbursement for household equipment - a dishwasher, furniture, fridge, washing machine and dryer for which he had paid and had receipts. Further cross-examination made clear that he understood the payment to be reimbursement of expenses already incurred by him. He provided a comprehensive schedule, prepared by an accountant, of all his expenditure related to Horace Street, comprised in the "other post acquisition expenditure" referred to above. If as he says this was "reimbursement", it must nonetheless be set off against his expenditure, and reduce his claim to that extent.

57 As to the withdrawals totalling $76,161.07 from the 3251 account between 24 June 1997 and 26 April 2000, which the sister presumes were taken by the brother in reimbursement of mortgage instalment payments, in fact her evidence did not rise above the assertion that the payments were not authorised by her and so must have been by the brother, who was a signatory to the 3251 account. The brother denied that he operated the sister's account after she came to Australia (save for the joint account in later years), and that contention has not been disproved. Documentary evidence established that of that sum, $22,500 withdrawn on 23 July 1997 was for the purchase of a motor vehicle by the sister. The withdrawals were not reflected in corresponding deposits to any of the brother's accounts in evidence. Notations made against some of the transactions in Mr Ford's handwriting - he managed the sister's finances for some years - provide an explanation, expanded upon in the brother's oral evidence, that they were for the benefit of Horace Street. No evidence confirmed that they were payments to the brother, let alone in reimbursement for mortgage repayments. No evidence has been adduced to corroborate the sister's version, on an issue on which she bears the onus. In those circumstances, I am unpersuaded that it has been established on balance that the withdrawals in question were made by or for the benefit of the brother.

58 As to the payment allegedly made on 13 February 2002 of $21,500 [evidenced only by a cheque butt in that amount and date: Ex PJC-25] it appears on examination to be the same transaction as the payment of $21,000 off the home loan on 19 February; there may have been a correction of $500 in the amount and a delay of some days before it was banked on 19 February.

59 As to the payments from the 7525 account - which the sister originally claimed were in respect of the mortgage - many were in fact payments made by the brother for his own purposes, out of funds deposited to the account from his own resources; insofar as there were payments to the home loan, they were out of unearned wages deposited to the account as a means of enabling the brother to maintain her car and her child.

60 Accordingly, except in relation to the $10,000 paid on 3 July 1997, and $17,784, being the balance of the withdrawal from the 0595 account on 25 June 1997, I am unpersuaded that the sister has reimbursed the brother in respect of the mortgage instalment payments, or his other post-acquisition expenditure. As it seems to me, the brother is entitled to have the sister account to him for the benefits she has received from his mortgage payments up to February 2002, and his post-acquisition expenditure on the property, less the amounts of $10,000 and $17,784 which he has received. The sister is therefore liable to account to the brother for $168,680.77, less $27,784 already received by the brother, being a balance of $140,896.77. The approximate weighted mid-point of those expenditures is late 1999, and I would therefore allow the brother interest on that amount for 9 years to judgment at 10%, which amounts to $126,807.09, totalling $267,703.86. Who is responsible for the $190,000 drawdown? 61 This issue concerns who, as between the parties, is responsible for the mortgage insofar as it secures the $190,000 redrawn on 7 February 2002 and paid to the parents, and interest thereon. 62 In August 1993, a sum of about $160,000 was transferred from Taiwan to the brother in Australia to assist him to establish a business. The provision to him of at least most of that amount is established by documentary evidence, and conceded by him. The sister says that she provided the bulk of these funds, together with a small contribution from the parents, as an "investment" in the brother's business. The parents say that they raised most of it on the security of their Taiwan home, to which they added some money provided by the sister, and advanced it as a loan. However, there was no evidence of the surrounding conversations (if any), and when asked whether, so far as he was concerned at the time, it was a loan or a gift or something else, he answered "I don't know. I think maybe it's a loan … It's not a gift".

63 The brother says that he received money from his parents, but that it was the proceeds of a property in Taiwan that had been bought in his name. Although some documentary evidence was adduced at the trial, apparently with the intention of establishing that there had been property registered in the brother's name in Taiwan, it was equivocal; it was an authority to purchase property addressed to his father, and not evidence that he held any such property. However, after judgment was reserved, the brother sought and was granted leave to re-open, to tender a Taiwanese land title search, obtained after the hearing, which showed that he had held land in Taiwan, acquired in his name in 1991, but sold to his sister on 14 May 1993 (the brother had not previously known that his sister was the purchaser). This falsified evidence, given by the father and the mother, to the effect that there had been no property in Taiwan registered in the brother's name, and rendered misleading evidence of the sister to the effect that he had had no property in Taiwan, and led to extensive further investigation of the facts, evidence and submissions.

64 The evidence, such as it is, suggests that the proceeds of the 1993 sale amounted to the then equivalent of A$35,000. While that evidence is far from satisfactory, it is consistent with the moneys advanced to the brother having come in part from the sale of the unit in his name (which was not necessarily his beneficially), in part from a loan raised by the parents on the security of their home, and in part from the sister - which is the best explanation of the whole of the evidence on this topic.

65 The falsification of the denials that there was property in Taiwan in the brother's name - and indeed the absence of any reference to that property in the evidence in the sister's case until the re-opening, although she had purchased it - caused me to review anxiously my conclusions as to the credit of the parties. Ultimately, however, my preference for the sister's version of the 1997 arrangements is founded not on any general preference for her evidence over that of the brother, but on objective indicia of relative probability, which is the safest recourse when one cannot be sure that either party is doing his or her best to tell the truth. 66 When the mother visited Australia in January 2002, the parents' financial situation was difficult, and their mortgagee was demanding repayment of the loan they had obtained in 1993 to assist the brother. The mother's evidence is that she noticed that the brother owned property and drove an expensive car, and asked him to repay the loan, and that he agreed to do so - albeit reluctantly, since in cross-examination she said that in agreeing to do so he added "I'll cut you off". She said that she did not discuss the matter with the sister. 67 According to the sister, her mother mentioned her financial circumstances but had no detailed discussion with her about it, and none at all about the withdrawal of the $190,000 before it occurred. Her mother discussed her "money situation" and mentioned having talked with the brother about her financial circumstances, but they did not have a detailed discussion on the topic. The sister had no conversation with anyone about the withdrawal of the $190,000 before it occurred, and while she learned that it had been paid not long after the event, she only became aware that it had been paid from the home loan account "maybe a few months later", which she clarified to be between two and six months. While she was unhappy at this discovery, she accepted her brother's promise that he would repay it as soon as possible.

68 The brother says that when visiting his mother at the sister's house, he and his mother argued about her request that he advance money to them, and that he was unwilling to assist her because she had a "gambling habit" - which he later explained to mean trading on the stock exchange. But the next day, his sister proposed that they provide the $190,000 out of the home loan account which she had recently reduced, and while he argued against it, his attitude was that it was a matter for the sister, since she had paid $180,000 off the loan, so he told her "It's up to you". He then attended with her at the Pymble branch of the Commonwealth Bank and made the transaction, at her request and in her presence.

69 The brother's versions of the events surrounding the payment of the $190,000 were discrepant, varying as to the reason he gave the mother for not acceding to her request (that it was for gambling, or that he did not have sufficient funds); as to the number of conversations that took place between them (varying between one and two and reverting to one); and as to whether his attitude was that such payment was a matter for the sister (because it was from the funds she had deposited) or that they argued over whether such payment should be made.

70 Mr Ford said that the brother told him that the sister wanted $190,000 drawn down against the Horace Street property for his parents, who were "in serious financial trouble due to gambling debts", and that he was going to the bank with his sister to attend to it. Mr Ford was aware that the sister had recently paid $180,000 off the home loan. He said that he and the brother were suspicious that she was scheming to make a claim to the house, but as she had made the capital repayment felt powerless to oppose the use of the funds to pay the parents. This is not at all credible: if it was the truth that she wished to use the funds for that purpose, then it would surely have come to them as a great relief that she wished to use the funds to assist the parents, as it would have demonstrated that she had no such scheme. Mr Ford's memory had been refreshed prior to his making his affidavit by discussing his recollections with Mr Chao. His assertion that he only responded to what he recognised to be false statements in the sister's affidavit material could not be right, since when he swore his affidavit the sister had said nothing at all in her material about the $190,000. The reliability of Mr Ford's evidence on this topic is therefore dubious. 71 The father gave evidence that he had sent a facsimile letter to his son, the brother, with particulars of the account to which the payment was to be remitted. The brother denied ever having seen the letter, but the sister said that it was handed to her by the brother in an envelope (which was produced containing the facsimile letter) addressed to "Mr Chao" and bearing, as has already been mentioned, in the brother's handwriting, the figures which correspond with the account balances in the home loan account on 21 January and 4 February 2002. Initially, I was very suspicious of the authenticity of this facsimile letter: some aspects raised serious doubts, most particularly that it contained an assertion by the father that he was 77 years of age (an age which he attained in 2005, not 2002), and the covering affidavit had originally (before a handwritten alteration) attributed a date of 2005 to the letter. The letter also referred to the brother having recently returned from a trip to Japan, and to a downturn in his business, which the brother placed in 2005 or thereabouts. 72 However, evidence was adduced that, according to a traditional Chinese method of calculating age (that is, a child attains age one at birth, and age two on the first Chinese New Year thereafter), the father was 76 by February 2002. And the brother's passport established that he had visited Japan between 26 December 2001 and 8 January 2002. Although the brother denied receiving the letter, it was never put to his father that it was a fabrication. The sister's evidence, that she received it in the envelope produced, derives some corroboration from the brother's concession that the figures on the envelope corresponding with balances of the home loan account as at 21 January and 4 February 2002 are in his handwriting; this enables the envelope to be probably dated at about that time. As I have said, the serious allegation that this document was a fabrication was never put to the father. The letter is not entirely coherent, but on reflection and repeated reading, it seems likely that it was written, not as a demand in advance, but after the brother had agreed to make the payment, though before he in fact remitted it, in order to provide particulars of the account to which it should be transmitted. It does not speak in terms of repayment of a loan, and rather treats the transaction as if it were an advance by the brother, which might even later be returned to him, at least in some events. Significantly, it treats the transaction as the brother's - not the sister's, nor a joint one. 73 The essential question is, what was the nature of the payment of $190,000 in February 2002? The original source of the funds advanced to the brother is but a small element in this analysis. That there may have been property in his name in Taiwan does not establish that all funds advanced to him came from that source, and does not exclude that the parents borrowed on the security of their home to assist him. It is not inconsistent with his being under some perceived obligation to reciprocate in some way the assistance he had received. While I incline to the view that there was no enforceable loan that the brother was bound to repay, the cultural setting was one in which, having been helped by his parents in the past, he was perceived as being under a moral obligation to return that assistance now, and the payment of $190,000 was regarded by him and the parents as performance of that obligation. The mother said that his response was ultimately that he would pay the money, but "I'll cut you off"; his own evidence tends to corroborate that, as he said that he provided financial support to the parents on a periodical basis until 2002, and then ceased it and ceased to have contact with his parents. To my mind this favours the view that it was his transaction, which he felt obliged - albeit very reluctantly - to make, and not his sister's.

74 The matters to which I have referred also favour the view that the sister did not authorise and was not aware of the drawing of $190,000 against the home loan. It is of particular significance that, on 13 February 2002, having obtained the payout figure from her brother as at 4 February, she drew a cheque to pay a further $21,000 off the home loan, which was deposited on 19 February - and which would have seen the home loan repaid in full, but for the intervening drawdown of $190,000. The brother and Mr Ford accept that the sister asked for information about the loan balance and said that she wanted to pay it off, and the brother's handwriting on the envelope addressed to "Mr Chao" evidences that he obtained the balance as at 21 January and 4 February 2002. That the sister paid $21,000 after 7 February is a significant indicator that she was unaware of the drawdown on that date of $190,000 from the home loan account; such payment does not make sense if she was aware that $190,000 had been redrawn from the account.

75 Accordingly, I conclude that the drawing of $190,000 for payment to the parents was a transaction of the brother for his purposes, unauthorised by the sister and entirely for the brother's account. He is responsible for the mortgage insofar as it secures that sum and interest on it. Who is responsible for the Ferrari extension? 76 The sister returned to Taiwan between November 2004 and March 2005. In about March 2005, the brother purchased a new Ferrari motor vehicle, which he financed with further borrowings of $492,000 on the Horace Street home loan account (although he contemporaneously repaid $56,000). 77 The sister says that when she returned from Taiwan she became aware that he was driving a new Ferrari, but only later - in December 2006, when her brother told her that he could not transfer the property to her, because he had mortgaged it for the Ferrari loan - that he had acquired it by borrowing against Horace Street. The brother says that he told her that he was buying a new car and intended to borrow against Horace Street for that purpose and asked if that was acceptable, to which she responded that it was, so long as he repaid as soon as possible; the sister denies this (although she concedes that she had, on another occasion, at least indicated that she might be prepared to allow the mortgage to be used by the brother for business borrowings, to fund a new shop). The brother says that he told her that he would pay it off as soon as possible, and that he felt embarrassed about it, but thought that as she had withdrawn the $190,000 for the parents (which version I have rejected), there was no reason why he should not do so (notwithstanding the very much greater amount involved). Mr Ford claims to have witnessed the brother showing the sister a Ferrari brochure, and saying that he would need to refinance Horace Street to buy it. Mr Ford and the brother claim that the sister drove them to the Ferrari showroom in William Street, East Sydney, on the occasion when they were to collect the new vehicle; she denies it. 78 There is no serious issue that the brother arranged the Ferrari extension of the home loan purely for his own purposes, and that he is responsible for the mortgage to the extent that it secures the Ferrari advance and interest on it. The real issue is whether or not the sister consented to his use of the property for that purpose: if she did, then while that would not alter the circumstance that, as between the parties, the brother alone is responsible, it would affect the terms on which he is obliged to indemnify the sister and exonerate the property - and, in particular, whether he is bound only to perform his obligations under the mortgage in accordance with its terms as and when they fall due, rather than immediately to discharge the mortgage insofar as it secures the Ferrari extension. 79 Again, a number of factors lead me to the view that the brother did not obtain his sister's consent to the Ferrari extension. First, there is his concession that he "felt embarrassed" about it: an improbable state of affairs had he sought and obtained her prior consent. And his explanation for nonetheless proceeding - that the sister had done the same thing with the $190,000 - is equally improbable as, on his own version, he agreed to it because she had just made an equivalent voluntary principal reduction, whereas he had not. Secondly, the time frame of the sister's absence in Taiwan between November 2004 and March 2005 makes it unlikely that the conversations asserted by the brother and Mr Ford took place prior to his purchasing the vehicle. Mr Ford was on the periphery of the conversation he claimed to witness at the North Turramurra property, and his evidence of it is very unlikely to be precise. It is possible that he witnessed the brother saying something to the sister about being interested in a Ferrari, but I am persuaded of no more than that. Thirdly, and very importantly, when the sister swore her initial affidavits in these proceedings, she deposed (wrongly) that her brother had extended the loan to repay his separate home loan for his Curagul Avenue property (when in fact it was for the Ferrari). This incorrect supposition, sworn to by the sister in her early affidavits and maintained despite the brother's denial for some time, is a powerful indication that she did not then know that the extension was in truth for the Ferrari; she would not likely have persisted in a disprovable allegation she knew to be incorrect. Fourthly, while I am inclined to accept that the sister drove the brother and Mr Ford to William Street, and even that there was conversation between the brother and Mr Ford about picking up the Ferrari, I do not accept that that establishes knowledge or consent on the part of the sister to the use of the home loan to fund its acquisition. It may well be that the sister no longer recalls those events because they were not remarkable (from her perspective) at the time. But even if she had some knowledge of the intended acquisition of a Ferrari, I am quite unpersuaded that she consented to the use of the Horace Street home loan for that purpose. Conclusion 80 My conclusions may be summarised as follows. 81 The sister is the beneficial owner of the Horace Street property, and the brother holds it upon trust for her, pursuant to a common intention trust arising from the arrangements made between the parties at the time of acquisition in 1997, or alternatively pursuant to a resulting trust in circumstances where the home loan initially obtained by the brother was in the nature of bridging finance and the principal was paid off by the sister. 82 However, it not having been established that the brother was reimbursed for his expenditure on the property (including mortgage payments) of $168,680.77 - save to the extent of $27,784 - the sister is liable to account to him for the balance of $140,896.77, which with interest at 10% for 9 years to judgment amounts to $126,807.09, totalling $267,703.86, which amount is charged in equity upon the property. 83 Had I not been persuaded that the property was held for the sister on either of those bases, then the brother would have held Horace Street upon resulting trust for himself and his sister in proportions 251:117, but subject to an equitable charge securing to the sister her contributions to the mortgage repayments of $180,000 and $21,000, and interest thereon. 84 The $190,000 drawn down in February 2002 was a transaction of the brother exclusively for his account, and he is responsible for the mortgage insofar as it secures that advance and interest on it. Likewise, the extension of the home loan to finance the brother's acquisition of the Ferrari in March 2005 was a transaction of the brother exclusively for his own account. The sister did not consent to it, and the brother is responsible for the mortgage insofar as it secures that advance and interest on it. As the payments made by the sister in November 2001 and January 2002 would have repaid the home loan account but for the $190,000 redraw and the Ferrari extension, and the mortgage now secures only principal and interest attributable to those two advances, as between the parties the brother is responsible to the exclusion of the sister for the whole of the amount presently secured by the mortgage, and is bound to indemnify the sister in respect of, and procure the discharge of, the mortgage. 85 Subject to any submissions that may be made as to their form, I propose to make the following orders: 1. Declare that the defendant Sheng-Chun Chao holds the property situate at and known at 1 Horace Street St Ives in the State of New South Wales being the land comprised in Folio Identifier 32/29027 ("Horace St") upon trust for the plaintiff Ping Jung Chao, but subject to a charge securing to the defendant the principal sum of $140,896.77 and interest at 10% per annum from 1 November 1999 which as at this date amounts to $126,807.09, totalling $267,703.86.

2. Declare that the defendant is bound to indemnify and keep indemnified and exonerate the plaintiff and Horace Street in respect of all liability under mortgage registered number 3176630 to the Commonwealth Bank of Australia ("the Mortgage").

3. Order that within 42 days (or such further time as the parties may agree): 3.1 the plaintiff pay the defendant the said sum of $267,703.86;

3.2 the defendant procure the discharge of the Mortgage and execute and deliver to the plaintiff a transfer in registrable form to her of all his right title and interest in and to 1 Horace Street, unencumbered.

4. Reserve liberty to apply by arrangement with my Associate on 3 days' notice in the event of any difficulty arising in the implementation of these orders, including for alternative relief in the event that the defendant does not discharge the mortgage, any such notice to specify the relief to be sought.

5. Order that the defendant pay the plaintiff's costs. **********

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