De Blac v Lo

Decision 12In my opinion, the answers to these questions are: (1)No. (2) (a)Not established; (b)Does not arise; (c)Does not arise. 13I doubt these answers will quell the dispute between the parties. It may well emerge that the parties' interests would have been better served had all issues in the proceedings been determined at once at a final hearing. The proceedings may well demonstrate that, especially in family provision cases, the seeming virtue of having particular issues heard separately and in advance of other issues, is illusory.

Representation of the estate 14Although Ms Lo is the executrix of the Deceased's estate, she did not purport to represent the estate for the purpose of these proceedings. 15As she is the sole beneficiary of the estate, her interests are in alignment with that of the estate. She is thus a suitable contradictor to Mr De Blac's claims. 16For that reason, and with the consent of the parties, at the outset of these proceedings, I made an order pursuant to r 7.10(2)(a) of the UCPR that the proceedings continue in the absence of a representative of the Deceased's estate.

Ms Lo's contentions 17The basis of Ms Lo's contention that the beneficial title to the Property has vested in her is set out in her Points of Defence as follows (substituting terms defined in these reasons): "1. In early 1995, the Deceased and Ms Lo entered into an agreement pursuant to which: (a) Ms Lo agreed to pay for extensions to the Property; and (b) the Deceased agreed that Ms Lo would own the extensions for which Ms Lo paid, and that Ms Lo and her daughter, Vivien Au, would be able to reside in the extended part of the Property for the rest of their lives. 2. In or about mid 1995, Ms Lo paid about $150,000 for the extensions to the Property, and she has resided there with her daughter ever since. 3. In late 1996, the Deceased and Ms Lo entered into an agreement for the sale of the balance of the Property by the Deceased to Ms Lo for $140,000. 4. Between about December 1996 and December 2010, Ms Lo made payments to the Deceased totalling $140,000, being payments towards the purchase price of the Property. 5. By no later than December 2010, the Deceased as vendor held the legal title to the Property wholly on trust for Ms Lo as purchaser."

The witnesses 18Ms Lo gave her evidence through an interpreter, in Cantonese. I found her to be an impressive witness who had a good recollection of events, despite the passage of time. She gave her evidence clearly and directly and was prepared to make concessions where appropriate. I have no hesitation in accepting her as a witness of truth. 19Ms Lo gave evidence of conversations with the Deceased. It was not suggested to her in cross-examination that her account of the conversations was untrue or unreliable. Having observed Ms Lo in the witness box for almost a full day, I am satisfied that she gave an honest and accurate account of what happened. 20Some passages from Mr De Blac's affidavit evidence were read. He was not required for cross-examination.

Factual background 21Mr De Blac is 89 years of age and claims that he is eligible to make a claim for provision in respect of the Deceased's estate because: "I am person with whom the deceased person was living in a de facto relationship at the time of the deceased person's death, and I was wholly dependant on the deceased person for accommodation since 1992/1993 (being a period of approximately 21 years)." 22I make no finding about this contention. Argument on the separate questions proceeded on the assumption that Mr De Blac had, or would, establish that proposition. 23The Deceased died on 7 May 2013. She was then 76 years of age. 24She left a will dated 17 July 2001 that, as I have mentioned, named Ms Lo as executrix and sole beneficiary. That will revoked and replaced an earlier will dated 29 January 1980, which also named Ms Lo as sole beneficiary. The only significant difference between the two wills is that, in the more recent of the two, the Deceased provided that should Ms Lo predecease her, her estate should go to Ms Lo's daughter, Ms Yuen-Wai Viven Au. 25The other executor named in the 2001 will has renounced all right to probate. The only other potentially eligible person to make a claim against the Deceased's estate, Ms Au, has indicated that she does not wish to make any claim against the estate. 26Both Mr De Blac and Ms Lo presently reside at the Property. Ms Lo resides with her daughter, Ms Au, in a part of the Property that was renovated and extended in 1995 to accommodate them. Mr De Blac resides in a different part of the Property. 27Ms Lo is 66 years of age. She is the youngest of the Deceased's five siblings.

The Extensions 28Until 1994, Ms Lo lived in Hong Kong with Ms Au. In 1994 Ms Lo spoke to the Deceased about emigrating to Australia. 29The following conversation took place: Ms Lo: "I'm coming to Sydney. The Deceased: Would you like to live with me? Ms Lo: Your home is too small. The Deceased: You are right. You can extend the home to build another two bedrooms, a bathroom and living room. And that way there will be enough room for [Ms Au] and you to live there with me. Ms Lo: I have money. I can pay for the extensions. The Deceased: If you add two bedrooms, sitting area, and a bathroom to my home and pay for it yourself then you will own that part of my...home. You can live there with [Ms Au] for the rest of your lives. When I die I will leave all my property to you." 30Consistently with that evidence, Mr De Blac gave evidence that he had this conversation with the Deceased at about the same time: The Deceased: "What do you think if I put an extension on this house and [Ms Lo] and [Ms Au] come to live with us here? Mr De Blac: You can do as you like. It is your house." 31Ms Lo and her daughter emigrated to Australia from Hong Kong in January 1995 and moved into the Property with the Deceased and Mr De Blac. 32The extensions were effected between March and June 1995. A friend of Mr De Blac, Mr Michael Cummings, coordinated the building work. The effect of the extensions was described by Mr De Blac: "The extension provided [Ms Lo] and [Ms Au] with separate accommodation at the [Property] comprising two bedrooms, a bathroom and their own large sitting room. Other than for a common kitchen, laundry and dining alcove (the latter room is almost never used), [Ms Lo] and [Ms Au] were provided with separate accommodation at the [Property] as a result of completion of the extension." 33At about the same time that the extensions were built, some renovations were effected to that part of the Property in which the Deceased lived. 34I am satisfied that Ms Lo paid for the extensions and the renovations and that Mr De Blac knew this. Ms Lo said that the amount she expended on renovations (as opposed to extensions) was $30,000 and that this sum represented part repayment of an earlier loan from the Deceased to Ms Lo. Ms Lo did not rely on that payment in these proceedings. 35So far as Mr De Blac's knowledge is concerned, he said that, before work was undertaken for the extensions, the Deceased said to him: "My sister is going to pay for all of the extensions". 36Ms Lo gave evidence, which I accept, that Mr Cummings arranged to pay the expenses of the extensions using funds from Ms Lo's cheque account at the HSBC Bank Australia Limited. Ms Lo gave Mr Cummings a number of cheques drawn on her account in blank. She recognised this was a risky procedure from her point of view and sought to protect her position by having no more than $20,000 in her account at any one time, otherwise than when Mr Cummings notified the incurring of particular expenses exceeding that amount. Ms Lo was living at the Property during the renovations and said she was able to monitor the work being done. There is no suggestion in the evidence that Mr Cummings did otherwise than faithfully use Ms Lo's funds for their intended purpose. 37Ms Lo no longer has her bank records from this period. However she kept a running account ("the Account") of the expenses incurred on the renovations. Ms Lo based the Account on cheque butts completed by Mr Cummings. 38Ms Lo gave detailed evidence about the creation of the Account. Its appearance suggests that some entries were created at the one time, but that other entries were created on different occasions. This was consistent with Ms Lo's evidence that the Account was prepared as and when Mr Cummings produced cheque butts from Ms Lo's account for her consideration. 39According to the Account, Ms Lo caused some $149,000 of her funds to be spent on the extensions. 40In cross-examination, Mr Underwood, who appeared for Mr De Blac, did not suggest to Ms Lo that the Account was otherwise than an accurate and reliable record of the funds expended by Ms Lo on the Property. 41I find the Account to be both reliable and accurate and find that Ms Lo paid some $149,000 for the extensions. I find that Ms Lo did so in reliance on the promise made to her by the Deceased that, if she funded the extensions, the Deceased would leave the Property to her in her will. 42As to that promise, Ms Lo gave this evidence in cross-examination: Q. "Did you understand that your sister was going to leave the Property to you in her will? A. I knew when she made her will in 1980. Q. When you had this conversation in 1994 [being the conversation referred to at [29] above] you also knew that you would be left the Property in her will even if you did the additions to the house [sic]? A. I don't know what you mean because she has been telling everyone that she would leave the Property to me even then. At that time there was no extension. Q. When this conversation occurred in 1994, which you set out in your affidavit, you understood that your sister would, it would be your sister's house until the day she died? A. Then I would have it. Q. It was your understanding you wouldn't get it before she died, the house? A. Yes, I do know... Q. It was your understanding when you spoke to your sister in 1980 and 1994 that your sister was the owner of the house legally? A. Yes, I did know. Q. You understood in 1980 and 1994 that your sister was the legal owner of the Property? A. Yes Q. When you had this conversation in 1994, was it your understanding that you wouldn't get the legal title to the [Property] owned by your sister until she died? A. Yes."

Agreement for the "sale" of the Property 43In about July 1996 the Deceased said to Ms Lo: "I want to retire next year. But I am concerned that the money I will get on retirement will not be enough for me to live on. I expect to receive about $150,000 from superannuation when I retire. I am allowed to keep only $125,000 to be eligible for a full single pension." 44Ms Lo said that over the next four to six weeks the Deceased spoke regularly to her about the Deceased's concerns about funding her retirement and that, from time to time, she said: "I have not heard of people building a house without buying the land." 45Ms Lo said that she assumed that when the Deceased referred to "people building a house without buying the land" she was referring to the fact that Ms Lo had paid for extensions on the Property but had not "purchased" the Property itself. Ms Lo said: "I asked myself, does [the Deceased] want me to buy the land." 46I admitted that evidence only as to Ms Lo's state of mind. 47In her first affidavit, Ms Lo said that in about September 1996, she had the following conversation with the Deceased: The Deceased: "I am retiring soon. I will not have income. Would you be interested in purchasing my... home? Ms Lo: Yes. How much do you want? The Deceased: The land is valued at AUD $95,200. I will sell my home to you for AUD $140,000. Ms Lo: I will pay you the price you ask. I will pay you the AUD $140,000 to purchase your home. I do not have enough money to pay you by lump sum. Can I pay you AUD $1000 each month? The Deceased: Yes. However, you cannot be registered on title as the owner until I die." Ms Lo: I agree to that." 48In a later affidavit, Ms Lo gave a similar account of her exchange with the Deceased as follows: The Deceased: "Look. The Valuer General has valued my land at $95, 200. Ms Lo: Do you want me to buy your land? The Deceased: Yes. Ms Lo: How much do you want? The Deceased: I want $140,000. The land is cheap. If you pay me $140,000 you are the owner of the land. Ms Lo: I agree." 49The Deceased's reference to the Valuer General was a reference to a valuation of the "land value" of the Property which was $95,200 as at 1 July 1995. 50Ms Lo was tested in cross-examination about this evidence: Q. "When your sister said to you, 'you cannot be registered on title as the owner until I die', did you understand that at the time of this conversation, in 1996, that your sister was leaving the [Property] to you in her will? A. This is what happened. In 1996 he- she (sic) raised the request that I would - I bought her land. The reason being when we did the extension, I did not pay for the land. So she said that you might as well buy the land so that the complete property would belong to you. Belong to you - to me. But her condition was, she had to live in the Granville property until she dies so I can then change the name to mine... Q. And the arrangement was that until your sister died, she was the owner of the house. A. Yes. Because the name wasn't changed. Q. And there was no transfer ever signed by her during her lifetime? A. No. Q. The arrangement, I put to you, was that you paid $140,000, and in return your sister would leave the property to you in her will? A. The name will be changed - the property would be put in my name. Q. I am putting to you that by paying money to her, your sister said, 'If you pay the money to me, I will leave the property to you in my will'? A. It wasn't like that. When I bought the land from her, in 1996, I owned the property, but she requested that the name should not be registered under my name until she dies. Q. And the method of transferring the property to you was in your sister's will by her leaving it to you? ... A. Because I have already bought the land from her in 96, so the whole property belonged to me. What she meant was, apart from the property, she would leave everything else to me in her will. Q. But in 1994 when you had the conversation, your sister indicated to you that she was going to leave the property to you in her will when you were discussing the renovations [sic - the extensions]? A. Yes. The deal was made in 1996, the transaction occurred in 1996. Q. And that was an oral transaction, you say? A. Yes. Q. And did your sister give you the Certificate of Title in 1996? A. No. Q. And she gave it to you shortly before she died? A. Two months before she died. Q. And as you have said before, no transfer was signed? A. No, we didn't do any legal procedures." 51Mr De Blac gave evidence that, much later, in about 2007 or 2008 the Deceased said to him: "I have made a will with a solicitor at Granville. I have left the house to [Ms Lo]." 52Mr De Blac said that the Deceased repeated these words to him at least annually since then and that on 27 March 2013 the Deceased said to him: "[Ms Lo] and I went to a solicitor in Granville some time ago and I made my Will out to leave this property to [Ms Lo] and, in return, [Ms Lo] gave me approximately $140,000. I was short of money at the time." 53Ms Lo claims that between December 1996 and December 2010 she made monthly payments to the Deceased (of $1000 to late 1998 and thereafter of $800) and that: "From December 1996 I paid the purchase price to [the Deceased] in reliance on my agreement with [the Deceased] and in accordance with my obligations under the agreement. ...[T]he money I paid to [the Deceased] to purchase the [Property] was not a gift to her... I kept a record in my diary of each payment that I made to [the Deceased]. I asked [the Deceased] to sign when I made a payment to her to acknowledge that the payment had been received by her...each time [the Deceased] received a payment she signed alongside the date when the payment was received" 54Ms Lo gave detailed evidence in chief of the process whereby she made entries in the diary to which she referred ("the Diary"). She said that she made monthly cash payments to the Deceased and that as and when she made those payments she wrote the date of the payment, and arranged for the Deceased to initial the Diary at the appropriate spot. She also made a note (initially in Chinese characters, and later in numerals) of the number of the instalment in the relevant calendar year. The Diary also records the amount of the instalments (initially $1000 per month and later $800 per month). Ms Lo said that from time to time she and the Deceased agreed to offset part of a monthly payment against expenses Ms Lo had paid on behalf the Deceased (for example for insurance premiums or council rates payable by the Deceased). When that occurred, Ms Lo made an entry in the Diary recording the set off. 55According to the Diary, between 31 December 1996 and 6 December 2010, Ms Lo made monthly payments to her sister totalling $140,000. 56On the date of the final payment, Ms Lo wrote a note (evidently to herself): "Congratulations! Paid off! (14 years)!!" 57Mr Underwood did not suggest to Ms Lo that the Diary was in any way false. I found Ms Lo's evidence about the Diary to be credible and reliable. I am satisfied that the Diary represents an accurate record of payments made by her to the Deceased. 58In March 2013, two months before she died, the Deceased gave Ms Lo the Certificate of Title of the Property and said: "I am giving you the certificate of the house...to keep".

Conclusion as to the agreement between the Deceased and Ms Lo 59I accept Ms Lo's evidence concerning her conversations with the Deceased. 60Based on those conversations I find that: (1)In 1994, and in consideration of Ms Lo paying for the extensions to the Property, the Deceased agreed that: (a)Ms Lo would "own" that part of the Property as was comprised by the extensions; and (b)she would leave all her property to Ms Lo in her will (that is, that she would not change her will of 29 January 1980 which had this effect); (2)Pursuant to that agreement Ms Lo spent $149,000 to effect the extensions; (3)Alternatively, the Deceased made representations to Ms Lo to the effect of (1)(a) and (b); (4)Relying on those representations, Ms Lo spent $149,000 to effect the extensions; (5)In 1996, the Deceased: (a)reflected on the significance of having told Ms Lo that she "owned" that part of the Property as comprised the extensions (see [44] above: "I have not heard of people building a house without buying the land"); and (b)concluded that she needed $140,000 more than she had in her superannuation to fund her retirement; (6)Thereafter, in 1996, and in consideration of Ms Lo agreeing to pay her $140,000, the Deceased agreed to "sell" the Property, or alternatively that part of the Property that Ms Lo did not already "own" on condition that: (a)Ms Lo would permit the Deceased to reside in the property until the Deceased died; and (b)Ms Lo could not be registered on the title of the Property until the Deceased died; (7)Pursuant to that agreement, Ms Lo paid the Deceased $140,000 by instalments between December 1996 and December 2010; (8)Alternatively, the Deceased made representations to Ms Lo to the effect of (6); (9)Relying on those representations, Ms Lo paid the $140,000 to the Deceased; (10)Consistently with those arrangements, shortly before her death, the Deceased gave the Certificate of Title of the Property to Ms Lo "to keep"; (11)The agreement referred to in (6) (or alternatively the representation referred to in (9)) was in addition to, and effectively undertook, the representation made by the Deceased to Ms Lo that the Deceased would leave the balance of her estate to Ms Lo in her will. 61The statements made by the Deceased to Mr De Blac in 2007 or 2008 and in 2013 (see [51] and [52] above) were not entirely congruent with the arrangements she made with Ms Lo. The Deceased told Mr De Blac that her agreement with Ms Lo was that in consideration of Ms Lo giving her $140,000 she had agreed to leave the Property to Ms Lo in her will (rather than "selling" it to her during her lifetime, albeit with the conditions referred to at [60(6)(a) and (b)] above). 62Further, for some reason, the Deceased did not say anything at all to Mr De Blac until 2007 or 2008; more than a decade after agreement was reached with Ms Lo. One can but speculate as to what motivated the Deceased to explain the situation to Mr De Blac in the terms she did, and as to why she remained silent for so long. 63However that may be, and despite the fact that neither the Deceased nor Ms Lo made a written record of their agreement, I am satisfied that Ms Lo's account of her dealings with her sister, the Deceased, reflects what happened between them. 64I do not accept Mr Underwood's submission that the proper characterisation of what occurred between the Deceased and Ms Lo was that the Deceased promised that Ms Lo would be entitled to the beneficial interest in the Property only upon or after the Deceased's death and was in that sense a contingent promise. I find the promise was that once Ms Lo paid the Deceased $140,000, Ms Lo would then be the "owner" of the Property (see [48] above), albeit with the condition that Ms Lo could not be "registered on title" as the owner until the Deceased died (see [47] above). The transaction was not, in my opinion, one which was to take effect only on the death of the Deceased. 65The arrangement was not an ideal one from a lawyer's perspective. There was more that the Deceased could have done; she could have signed a transfer of the Property in Ms Lo's favour and given the transfer to Ms Lo, or some other trusted person. It was not, however, suggested that the Deceased had, or that Ms Lo has any legal qualification or training, or that either sought legal advice about their arrangements; I infer they did not. 66The Deceased and Ms Lo were sisters. They trusted each other. The Deceased trusted Ms Lo not to seek to interfere with her occupancy of the Property during her life. Ms Lo trusted her sister not to renege on the arrangement.

When did the Deceased intend that Ms Lo would become the 'owner' of the Property? 67Accepting that Ms Lo's account is accurate, an issue arises as to when the Deceased intended that Ms Lo would "own" the Property. 68The Deceased said that if Ms Lo paid her $140,000 she would be the owner of the Property. Ms Lo then asked the Deceased if she could pay by instalments. The Deceased agreed. It is unclear from Ms Lo's account of what was said whether the intention of the parties was that Ms Lo would become the "owner" of the Property immediately, or only after she had paid each of the instalments. 69In my opinion, the better view is that the Deceased and Ms Lo's intention was that Ms Lo would only become the "owner" of the Property when she paid off the $140,000. That is consistent with the Deceased's statement that Ms Lo would be the "owner" "if" she paid $140,000. 70Further, although the Deceased was prepared to accommodate Ms Lo's request for time to pay, it seems unlikely the Deceased intended that Ms Lo become the "owner" forthwith. 71The careful arrangements Ms Lo and the Deceased made to record the payments made (with the Deceased initialling each payment entry in Ms Lo's diary) and Ms Lo's note to herself "Congratulations! Paid off!" (see [56] above) also point to this conclusion.

Absence of writing/estoppel 72In my opinion, in the circumstances that I have set out above, the Deceased would have been estopped, and the estate is now estopped, from denying the agreements for which Ms Lo contends (although I very much doubt that the Deceased would have disputed the existence of such agreements). 73Had a dispute arisen between the Deceased and Ms Lo during the Deceased's life, my opinion is that Ms Lo could have obtained declaratory relief to that effect. 74I accept the submissions of Mr King, who appeared for Ms Lo, that Mr De Blac, as a stranger and a volunteer, can be in no better position than the Deceased. 75The arrangements between the Deceased were not in writing (cf s 23C, s 23E and s 54A of the Conveyancing Act 1919). This does not, however, impede the intervention of equity when an estoppel arises. 76As Mr King submitted, the availability of equitable estoppel in the context of s 54A was expressly addressed by the High Court in Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387: ● "The Statute of Frauds and similar provisions prescribing formalities affecting proof of contracts have never stood in the way of a decree to enforce a proprietary estoppel and, in principle, there is no reason why such provisions should apply when any other equity is created by estoppel." (per Brennan J at 433 citation omitted); ● "[T]he estoppel precluding the denial of a binding agreement extends to preclude the assertion of unenforceability of the assumed agreement in that the word 'binding' is used in the sense of valid and enforceable. That being so, the estoppel outflanks the provisions of s. 54A..." (per Deane J at 446); ● "[T]he rights and liabilities of the parties are to be determined on the basis [the agreement] had in fact taken place... [which] necessarily also involves an assumption that the agreement was duly executed by the [promisor], and the question of compliance with s. 54A of the Conveyancing Act 1919 (N.S.W.) becomes irrelevant." (per Gaudron J at 464). 77As Sneddon, Bigwood and Ellinghaus observe in Cheshire and Fifoot Law of Contract, 10th Aust ed (2012) at [2.2], probably the most commonly cited passage for the requisite elements of estoppel is that of Brennan J in Waltons Stores at 428 - 429: "In my opinion, to establish an equitable estoppel, it is necessary for a plaintiff to prove that (1) the plaintiff assumed that a particular legal relationship then existed between the plaintiff and the defendant or expected that a particular legal relationship would exist between them and, in the latter case, that the defendant would not be free to withdraw from the expected legal relationship; (2) the defendant had induced the plaintiff to adopt that assumption or expectation; (3) the plaintiff acts or abstains from acting in reliance on the assumption or expectation; (4) the defendant knew or intended him to do so; (5) the plaintiff's action or inaction will occasion detriment if the assumption or expectation is not fulfilled; and (6) the defendant has failed to act to avoid that detriment whether by fulfilling the assumption or expectation or otherwise." 78In my opinion, each of these elements is satisfied in this case. Ms Lo assumed that she had entered into an agreement with the Deceased of the kind that I have described. The Deceased induced Ms Lo to adopt that assumption or expectation because she entered into the same agreement, upon which Ms Lo relies. Ms Lo has acted in reliance on the assumption that the Deceased would honour the agreement, as the Deceased knew and intended her to do. If Ms Lo's expectation is not fulfilled she will suffer detriment; she has paid $140,000 to the Deceased in reliance on the assumption that a binding agreement existed between them. The Deceased has failed to act to avoid that detriment by failing to execute a transfer in Ms Lo's favour. 79I accept Mr King's submission that Ms Lo's possible detriment can only be fulfilled by the transfer to her of the Deceased's interest in the Property or, at least, by giving the answer "no" to the first of the separate questions referred to in [11] above. 80Mr Underwood submitted that equity could be achieved, so far as Ms Lo is concerned, by an order for equitable compensation in the sum of $140,000. I do not accept that submission. At the time of the 1996 "sale" agreement between the Deceased and Ms Lo, Ms Lo had already spent some $149,000 on the Property. That sum was expended upon the basis of the Deceased's agreement that Ms Lo would then "own that part of my...home" (see [29] above). The effect of the 1996 "sale" agreement was that, in consideration of Ms Lo paying the Deceased a further $140,000, the Deceased would "sell" to Ms Lo, in effect, the balance of the Deceased's interest in the Property. 81In those circumstances, in my opinion, an award of equitable compensation to Ms Lo of $140,000 would not do equity between her and the Deceased. 82Nor would it do equity to Ms Lo to deny her a beneficial interest in the Property and require her to rest on such entitlements as arise by reason of her being the sole beneficiary of the Deceased's will. In that event, the beneficial title in the Property would remain part of the Deceased's estate and thus be amendable to Mr De Blac's claim for provision (see s 63(2) and s 72 of the Act). 83Further I accept Mr King's submission that the evidence also establishes acts of part performance by Ms Lo sufficient to establish her entitlement to the beneficial title to the Property. In particular, Ms Lo paid the $140,000 to the Deceased between 1996 and 2010. Contrary to Mr Underwood's submissions, I find that those payments were "unequivocally" and by their "own nature" referrable to the agreement for which Ms Lo contended (cf McBride v Sandland (1918) 25 CLR 69 per Isaacs and Rich JJ at 78 and 79). 84Further the Deceased, shortly before her death, handed the Certificate of Title of the Property to Ms Lo. 85Mr Underwood submitted: "Even the handing over the Certificate of Title was not a unequivocal act. As the deceased had nominated [Ms Lo] as her executor, the handing over of the Certificate of Title is consistent with the deceased preparing for her death and [Ms Lo] being in a position to administer her estate". 86I do not accept that submission. 87The Deceased told Ms Lo that the Certificate of Title was for her "to keep". Those words show that the Deceased was not handing the Certificate of Title to Ms Lo merely for safekeeping, and in her capacity as executrix of the Deceased's will. Rather she was handing the Certificate of Title to Ms Lo to seek to perfect the arrangements arising from the oral agreement made between the two sisters in 1996. 88As between the Deceased and Ms Lo, the position is equivalent (in the sense that the Deceased would be estopped from asserting the contrary) to what would have arisen had there been an exchange of contracts, payment of the purchase price but no transfer of the legal title. In that circumstance the Deceased would have held the Property on constructive trust for Ms Lo (see, for example Khalid v Perpetual Limited [2012] NSWCA 153 at [44] per Beazley JA with whom Whealy JA and Tobias AJA agreed; citing Chang v Registrar of Titles (Vic) (1976) 137 CLR 177 at 184 per Mason J). 89In my opinion, the Deceased was in the same position. Mr De Blac can be in no better position. 90For those reasons, in my opinion, the answer to the first of the separate questions referred to at [11] is "no".

Was there a "relevant property transaction"; was "full valuable consideration given"? 91A notional estate order may only be made under s 80 of the Act if the Court is satisfied (amongst other matters) that the deceased person entered into a "relevant property transaction" before his or her death. 92A "relevant property transaction" means the transactions affecting property and answering the description in s 75 or s 76 of the Act (see s 74 of the Act). 93Section 75(1) of the Act reads: "(1) A person enters into a relevant property transaction if the person does...any act that (immediately or at some later time) results in property being: (a) held by another person (whether or not as trustee), or (b) subject to a trust, and full valuable consideration is not given to the person for doing...the act." 94I have found that by agreeing to "sell" the Property to Ms Lo for $140,000, the Deceased did an act which resulted in "property" (being the beneficial interest in the Property) being held by "another person" (Ms Lo) (see [60] above) and resulted in property (namely the Property) being "subject to a trust"; namely a constructive trust in favour of Ms Lo (see [88] above). 95For the purposes of s 75(1) of the Act, the "act" of the Deceased that "at some later time" (namely, when Ms Lo paid all of the $140,000) resulted in Ms Lo "holding" the beneficial interest in the Property and the Deceased holding the legal estate in the Property on trust for Ms Lo, was her promise to "sell" the Property to Ms Lo and that if Ms Lo paid the agreed sum she would be the "owner" of the Property (see [47] and [48] above). 96Whether what has happened can be characterised as a "relevant property transaction" depends on whether or not "full valuable considerable" was "not given" to the Deceased for that promise. 97The onus rests on Mr De Blac to establish that, notwithstanding my finding that the beneficial interest in the Property does not form part of the Deceased's actual estate, it forms part of her notional estate. In order to do so, Mr De Blac must show that Ms Lo did not give "full valuable consideration" for the promise made by the Deceased. 98In that regard, I agree with the observations of Hallen AsJ (as his Honour then was) in Kastrounis v Foundouradakis [2012] NSWSC 264 at [99]: "The onus of establishing that full valuable consideration was not given, it seems to me, lies on the party asserting that proposition. Where, however, that party establishes a prima facie case of inadequacy of the valuable consideration given, the evidential burden will pass to the other party to establish that there was, indeed, consideration given, and the extent of that consideration." 99As to what comprises "full valuable consideration", in the same case, Hallen AsJ said at [95], after analysing the authorities: "...'full valuable consideration' means such valuable consideration as amounts to, approximates, or is broadly commensurate with, or is a fair equivalent of, the value of that for which it is given". 100In this case, the onus is on Mr De Blac to establish that the consideration given by Ms Lo to the Deceased ($140,000) was not "full valuable consideration". 101In my opinion, Mr De Blac has not established even a prima facie case of inadequacy of consideration; let alone that full valuable consideration was not given. 102The submissions made on behalf of Mr De Blac on this topic were as follows: "In the present case [the Property] is valued at between $550,000 and $630,000, depending on which valuation is preferred by the Court. [Ms Lo's] evidence, at its highest, is that she paid $149,105 for renovations, and a further $140,000 over 10 years as instalments of the "purchase price" for the house. This amounts to a total of approximately $289,105. [Ms Lo] has clearly not paid 'full valuable consideration' in the sense explained by Hallen AsJ...; [Ms Lo] has not paid valuable consideration as 'amounts to, approximates, or is broadly commensurate with, or is a fair equivalent of', the value of the [the Property]. On the valuation of [the Property] most favourable to [Ms Lo] (i.e. $550,000), she has paid consideration equivalent to 52.5% of the value. On the highest valuation of the property (i.e. $630,000), [Ms Lo] has paid consideration equivalent to 45.8% of the value. That is not full valuable consideration". 103The problem with these submissions is that the material relied on did not purport to be evidence of the value of the Property at the relevant time; namely September 1996 when the Deceased and Ms Lo entered into their agreement. 104The figure of $630,000 was taken from a market assessment (which Mr De Blac annexed to one of his affidavits) of the Property by Ray White Berala of the Property of between $600,000 and $630,000 as at 28 May 2013. 105The figure of $550,000 derived from a market appraisal, tendered on behalf of Ms Lo, of the Property by Richardson and Wrench Parramatta of between $550,000 and $580,000 as at 16 October 2013. 106There was no evidence before me as to the value of the Property in September 1996. 107There are in evidence Notices of Valuation published by the Valuer General that the net land value of the Property was: (a)$95,200 as at 1 July 1995; (b)$142,000 as at 1 July 1998; and (c)$161,000 as at 1 July 2001. 108Otherwise, the only material possibly relevant to the value of the Property is: (a)the statement that Ms Lo attributed to the Deceased in September 1996 that, at $140,000 "the land is cheap"; and (b)the statement Ms Au attributed to the Deceased in early 2002 that, according to the Valuer General, the value of the land had increased to $161,000 and that "your mother has made good profit from buying" the Property. 109At the time of the September 1996 agreement that the Deceased would "sell" the Property to Ms Lo for $140,000, Ms Lo had already paid something in the order $149,000 for the extensions. Thus, in truth, the total amount she paid for the Property was $289,000; as to $144,000 between March and June 1995 (for the extensions) and as to $140,000 between September 1996 and December 2010 (for the "purchase"). 110Absent any evidence of the value of the Property as at September 1996, I am not able to reach any conclusion as to whether the amount $289,000 was not "full valuable consideration" for the Property. 111Mr De Blac has failed to sustain the onus to assert absence of full valuable consideration and as such has not established that there has been a "relevant property transaction". 112Accordingly, I answer the separate question referred to at [11(2)(a)] above as "not established".

Did any "relevant property transaction" satisfy the requirements of s 80(2) of the Act? 113I am not satisfied there is a "relevant property transaction". Therefore this question does not arise. The question should be answered "not established". 114Assuming there was a "relevant property transaction" the Court may only make a notional estate order if the Court is satisfied that the transaction is one to which s 80 applies. 115Section 80(2) sets out the "relevant property transactions" to which s 80 applies. 116Mr Underwood relied upon only s 80(2)(c) which is in the following terms: "(2) This section applies to the following relevant property transactions: ... (c) a transaction that took effect or is to take effect on or after the deceased person's death." 117Mr Underwood referred to the other "classes of transactions to which s 80 is applicable", namely those referred to in s 80(2)(a) and (b), but did not rely on them. 118For the reasons I have set out at [64] above, I do not accept that the relevant "transaction" (the agreement of September 1996 between the Deceased and Ms Lo) took effect, or was to take effect only on the Deceased's death. 119Accordingly, in my opinion, s 80(2)(c) would not be enlivened, even if there were a "relevant property transaction". 120For completeness, I add that, in my opinion, neither of s 80(2)(a) and (b) would be enlivened, assuming that there was a "relevant property transaction". Section 80(2)(a) is not enlivened because, amongst other things, there is no evidence that the relevant transaction was entered into by either the Deceased or Ms Lo "with the intention, wholly or partly, of denying or limiting provision being made out of the estate", as that subsection requires. Section 80(2)(b) is not enlivened because, amongst other things, the relevant transaction did not take effect within one year of the Deceased's death, as that subsection requires. As Mr King submitted, the transaction took place in September 1996, when the agreement was made (see s 77(4) of the Act).

Is s 83(1) of the Act satisfied? 121Section 83 provides, relevantly to this dispute: "(1) The Court must not, merely because a relevant property transaction has been entered into, make an order under section 80...unless the Court is satisfied that the relevant property transaction or the holding of property resulting from the relevant property transaction: (a) directly or indirectly disadvantaged the estate of the principal party to the transaction [here, the Deceased] or a person entitled to apply for a family provision order from the estate or [here, Mr De Blac]...". 122Again, this question does not arise as I am not persuaded that it has been established there is a "relevant property transaction". The question should be answered "not established". 123In any event, I am not satisfied that the matters in s 83(1)(a) have been established. 124On its proper construction, the question posed by s 83(a) is, relevantly, whether the relevant property transaction "directly or indirectly disadvantaged" either the estate of the principal party to the transaction (here, the Deceased), or the person entitled to apply for family provision from the estate (here, Mr De Blac). 125I accept Mr King's submissions that the premise for the operation of s 83 is that a "relevant property transaction" has been entered into. Accordingly, in construing s 83, it is to be assumed that "full valuable consideration" was not given to the person whose actions or omissions are the subject of the relevant property transaction. 126It follows, as Mr King submitted, that the words "directly or indirectly disadvantaged" in s 83(1)(a) must mean something more than the fact (if it be a fact) that full valuable consideration was not given, because that is the characteristic of every "relevant property transaction". A contrary construction would permit the Court to make a notional estate order "merely because" a relevant property transaction has been entered into; a proposition denied by the words in the chapeau to s 83. 127Mr De Blac has not demonstrated any disadvantage to the Deceased's estate, or to his own position, over and above the alleged fact that full valuable consideration was not given by Ms Lo to the Deceased for the Property. I accept Mr King's submission that this is not enough.

Answer to the separate questions 128For those reasons, my answers to the separate questions are as set out at [12] above. 129I will hear the parties as to costs, and as to the further disposition of the proceedings.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 27 February 2014