Gifts - Whether gift in form of intended transfer of interest of registered proprietor as joint tenant of property under Transfer of Land Act 1893 (WA) to third parties not perfected in equity was subject to the exception in the rule in Strong v Bird - Whether the rule capable of application to gift of interest of joint tenant

3 On 7 May 2007, at the Hollywood Palliative Care Unit, Ronald had executed a transfer of land form T1 under the Transfer of Land Act 1893 (WA) (the Transfer Form of 7 May 2007) in respect of his interest in the Property for a consideration of 'Nil'. The Transfer Form of 7 May 2007 named Ronald as Transferor and, as Transferees and as tenants in common in equal shares, the plaintiffs. The plaintiffs, Josephine Stella-Marie Walter (Josephine), Graham Lester Stone (Graham) and Simon Elliot Stone (Simon), are his three children (collectively, the children or the plaintiffs). The children are by his first wife, Abigail Berad (Abigail).

4 Ronald then made two unsuccessful attempts to obtain the duplicate certificate of title to the Property.

5 Subsequently, on 16 May 2007, he signed an application for the issue of a new duplicate certificate of title to the Property on Form A5 under the Transfer of Land Act (the Application for a New Duplicate Certificate of Title), as well as an application for the Registrar of Titles to dispense with the production of the duplicate Certificate of Title in respect of the Property, under s 74, also on Form A5 (the Application to Dispense with the Duplicate Certificate of Title) (together, the Applications). On the same date he also swore a statutory declaration in support of the Applications (the Statutory Declaration).

6 Iris refuses to recognise any interest of Josephine, Graham and Simon in the Property. It is not in contest that if they have no interest in the Property by virtue of what they say is the transaction of which the Transfer Form of 7 May 2007 was a part (the claimed gift to the children of Ronald's interest in the Property) then Iris is entitled to be the sole registered proprietor of the Property by survivorship.

7 Josephine, Graham and Simon bring these proceedings by originating summons for declarations and orders. The declarations sought are that as tenants in common in equal shares the plaintiffs are equitable owners of one undivided half interest in the Property; that the second defendant is the equitable owner of one undivided half interest in the Property; that pursuant to the Transfer of Land Act the plaintiffs are entitled to be registered as the proprietors of one undivided half interest in the Property; and that pursuant to the Transfer of Land Act the second defendant is entitled to be registered as the proprietor of one undivided half interest in the land as tenant in common with the plaintiffs. The orders sought are principally that the first defendant, the Registrar of Titles, do all necessary things to give effect to the declarations; and that the second defendant produce the duplicate certificate of title to the Property to the first defendant for that purpose. During the course of the proceedings counsel for the plaintiffs indicated that they were abandoning their application for orders against the first defendant, and were simply concerned to have the declarations sought.

8 I begin these reasons by describing the factual background in some detail. I turn then to describe the proceedings including the evidence before me and the issues I must address. I then review the applicable law for each of those issues, before applying that law to the issue in question. The final section of my reasons is my summary of my conclusions and the orders I would make.

9 What follows is, like the factual background in the preceding section of these reasons, either common ground or evidence not in contest, except as I indicate.

11 On 6 November 1946 the first of the three children of the marriage, Josephine, was born. On 27 November 1950 the second of the three children, Simon, was born. On 13 December 1954 the third of the three children, Graham, was born.

12 On 2 March 1993, after the death of Abigail, Ronald married Annie Segler. She later died in a car accident.

13 On 25 February 2000 Ronald became the sole registered proprietor of the Property.

14 In August 2004 Ronald met Iris and began to go out with her.

15 On 31 August 2006 Ronald and Iris were married in small ceremony at the Property with none of Josephine, Graham or Simon present.

16 In early or mid-October 2006 a physician who had been treating Ronald, Dr Phua, organised a meeting at which Ronald, Iris, Josephine and Simon, as well as Simon's wife and at least one social worker, but not Graham, who was in Israel, were present. It appears not to be in contest that at all material times Dr Phua was head of palliative care at the Hollywood Palliative Care Unit; it may be noted that at all material times Ronald also had as his general practitioner a Dr James Chong.

17 At the meeting in early or mid-October 2006 Dr Phua said to those present that Ronald had cancer and was terminally ill while his condition was such that he would need care. It was at that meeting that Josephine and Simon first learnt that Ronald had married Iris, and subsequently to that meeting Graham was informed of the marriage. At the meeting Josephine was very upset to learn of the marriage: she called Iris 'names' and left the meeting.

18 By letter dated 28 November 2006 Ronald wrote to 'Conveyancing Services Perth' to request a transfer of the Property 'copy attached' to the joint names of Iris and himself.

19 On 4 December 2006 Ronald executed a will of that date (the Will of 4 December 2006). Having revoked all previous wills and testamentary dispositions, it provided that a niece of Iris, a Ms Galit Zohar, was to be executor. Following provision for his debts and funeral expenses and the death duties on his estate, there were two dispositive clauses.

All my estate share of house and contents to my wife Fabienne CohenStone. I have every confidence in her to carry out my personal wishes where possible.

22 On 19 February 2007 a transfer of the Property from Ronald to Iris and himself as joint tenants, showing as consideration 'Natural love and affection', was stamped and on 14 March 2007 the transfer was registered (the Transfer to Iris). At or about this time, on Iris's unchallenged evidence and that of Linda Tudori (Mrs Tudori), both Ronald and Mrs Tudori, who on Mrs Tudori's evidence had been present at a dinner at the Property in or about late March or the first week of April 2007 when this occurred, had said in the presence of one another that the effect of the transfer of the Property to Iris as a joint tenant was that if one of the joint tenants died the survivor took the Property.

23 On 22 February 2007 Iris, who was and continues to be a citizen of Israel, was granted a visa giving her permanent resident status in Australia.

24 On 30 March 2007 Ronald executed a will of that date (the Will of 30 March 2007). Having revoked all former wills and testamentary dispositions, the Will of 30 March 2007 provided for Ms Zohar or, failing her, her husband Oren Zohar, to be the executor and trustee. The Will of 30 March 2007 also provided, after giving Ronald's Jaguar car to Josephine, the following disposition:

I GIVE the rest and residue of my estate both real and personal to my Trustee UPON TRUST to pay my debts funeral and testamentary expenses and all other expenses payable by reason of my death and hold the balance UPON TRUST for my wife FABIENNE COHEN-STONE PROVIDED THAT if she predeceases me, or does not survive me by thirty (30) days my trustee is to divide or treat the balance as being divided into four (4) equal parts and to hold them UPON TRUST as follows:

(a) two (2) parts for my son GRAHAM LESTER STONE,

(b) one (1) part for my son SIMON ELLIOT STONE, and

(c) one (1) part for my daughter JOSEPHINE WALTERS

(i) if any of my said children predecease me leaving children who survive me and attain eighteen (18) years of age then those children take the part of my estate which their parent would otherwise have taken and if more than one then as tenants in common in equal shares, and

(ii) if any of the trusts of a part or parts in this paragraph fail because no person attains a vested interest in that part or those parts, then from the time of that failure that part or those parts is or are added equally to the other part or parts the trusts of which have not then so failed, and this provision applies to both the original parts and to parts which have increased as a result of the application of this provision.

25 It will be seen that the Will of 30 March 2007 principally differed from the Will of 4 December 2006 by its contingent provision for Graham, Simon and Josephine and any children of theirs.

26 By letter dated 6 April 2007 Ronald wrote to Simon (Ronald's letter dated 6 April 2007) in the following terms, which are handwritten, all in capitals, apart from the signatures:

As you are aware I recently remarried Fabienne Eris [sic Iris] Cohen. The most caring person I have ever met.

So naturally I have changed my will etc and power of attorney. I have advised Gary and revoked all former instructions Dr Chong and head doctor of palative [sic palliative] have both endorsed my new instructions. Thanking you for past favours etc.

P.S. A healthy, happy pesac [Passover?] to you all.

I thought the enclosed blue book my [sic might] bring a smile to you all.

Instead of staying in hospital I'm having treatment at home apart [sic in part] from Eris [sic Iris]. I have regular visits from Silver Chain almost daily and an area of 4 local doctors who are in conference and available 24 hours a day per week so I am well cared for. The enclosed book on caring for aged may be of interest not having a shot at you. [signature] (emphasis in the original)

27 There is an annotation 'home visits' in the margin alongside the passage beginning 'and available' and ending 'cared for'.

28 Notwithstanding its date, Ronald's letter dated 6 April 2007 was not posted until some time later, on or about 20 or 21 April 2007, on Iris's evidence, or 'late in April', which on Simon's evidence was when Simon received it, which on his evidence occurred before a conversation he had with Ronald on 27 April 2007, which I reach below. On Iris's unchallenged evidence, Ronald had left the letter in his Jaguar car.

29 On 13 April 2007 Ronald was admitted to the Hollywood Palliative Care Unit, where he was to stay, with only brief absences, during the period remaining until his death, 44 days later.

30 On 15 April 2007 Ronald executed a will of that date (the Will of 15 April 2007). It differed from the Will of 30 March 2007 materially for my purposes only in substituting as executor and trustee, for Ms Zohar, and failing her, her husband, Estelle Blackburn and Harold Joseph Paiker. Both Ms Blackburn and Mr Paiker were solicitors. It is not in contest that the Will of 15 April 2007 was prepared by Paiker & Overmeire, barristers and solicitors.

31 On or about 21 April 2007 on Iris's evidence she had brought Ronald's letter dated 6 April 2007 to the Hollywood Palliative Care Unit where she and Ronald had a conversation in which she reminded him about the letter and she asked him what he wanted done with it. He indicated he wanted it posted, and she thought that while she was alone she left the letter for posting with the front desk of the Hollywood Palliative Care Unit.

32 However, Mr Cohen's evidence was that it was at or about 6 April 2007, at the Property and before Ronald's admission to the Hollywood Palliative Care unit, Ronald had asked Iris to post Ronald's letter of 6 April 2007, on or about 20 April 2007. Mr Cohen's evidence was also that on 22 or 23 April 2007 he took Iris in his car to a letterbox near the chemist for the Hollywood Palliative Care Unit in which she deposited Ronald's letter of 6 April 2007.

33 On my analysis of the issues in this case, it is not necessary to resolve these differences in the evidence. That is because it is not in contest that the letter was, notwithstanding its date, posted some time later, to be received by Simon not long before his telephone conversation with Ronald of about 27 April 2007.

34 On the evidence of Iris she and Ronald had a conversation about two days after Ronald's letter dated 6 April 2007 was posted, that is, about 23 April 2007, in which they decided that the locks to the Property should be changed. It was Iris's evidence that, although at the time she was concerned about the possibility of others having access to the Property, it was Ronald's idea that the locks be changed. He had explained this on the basis that Josephine had keys to the Property, and he had said she was 'dangerous'. On Iris's evidence, shortly thereafter Ronald rang Mr Cohen and asked him to change them. On Mr Cohen's affidavit evidence he went to Hollywood Palliative Unit on or about 23 April 2007 and had a conversation with Ronald about changing the locks, in which Ronald said to him he was concerned about Josephine having a key to the Property, and it was decided Mr Cohen would change the locks. However, in crossexamination he testified that this was incorrect. Ronald had telephoned him on 23 April 2007 and asked him to change the locks, after which Mr Cohen had visited the Hollywood Palliative Care Unit, but been unable to talk with Ronald, who was asleep. He left Ronald's room, encountering Dr Phua and Iris in the corridor, where Dr Phua recommended a locksmith; on a later day after Iris had told Mr Cohen the locksmith's charge for changing the locks was too great he had bought locks. On Iris's evidence and that of Mr Cohen Mr Cohen did change the locks. On Iris's evidence he gave the keys to Iris. On her evidence neither Mr Cohen nor she gave the keys to Ronald, which she explained as that '[t]here was no need, we were together'. It will be seen that, although it is common ground the locks were changed, by Mr Cohen, the evidence that they were changed at the time indicated on Iris's and Mr Cohen's evidence, and that Ronald was involved in the changing of the locks at the time as indicated by their evidence, is sharply contested.

35 On the evidence of Iris, in late April 2007, but no later than 28 April 2007, she was in Ronald's room in the Hollywood Palliative Care Unit where she overheard a telephone conversation between him and Simon. On her evidence the conversation was about a 'rape allegation' concerning Ronald and Josephine which, as I will explain it, it was Iris's evidence had been made. I should note that in cross-examination Iris accepted that Simon had perhaps not used the word 'rape', although it was also her testimony that that was the subject-matter of Simon's exchange with Ronald.

36 I should also note at this point that it was Josephine's evidence that in 1991 she had complained to police and to the Sexual Assault Resource Centre that Ronald had molested her in a sexual way. However, she did not pursue the complaint, and no charge was laid against Ronald in connection with the incident. Her evidence was that she had never referred to the matter as 'rape'.

37 Returning to the telephone conversation in Ronald's room in the Hollywood Palliative Care Unit, it was Iris's evidence that Simon was saying to Ronald words to the effect that 'Well, you have to prove it in court that you didn't do it', and Simon asked Ronald if Iris knew about the allegation, to which Ronald replied that 'No she does not know, but now she will know. There are no secrets between us'.

38 On the evidence of Simon, on 27 April 2007 he had a telephone conversation with Ronald in which Ronald told him he and Iris were going to have a Jewish wedding ceremony and he had transferred a half interest in the Property to Iris. In view of Simon's evidence as to what formed part of that conversation that I will reach, I consider it more likely than not this is the telephone conversation to which Iris's evidence as to the telephone conversation between Ronald and Simon in late April 2007 related.

39 In respect of the first matter that on Simon's evidence was discussed in the telephone conversation, the Jewish wedding ceremony, it was Simon's evidence that Ronald said he wanted Simon to attend the ceremony with Simon's wife and daughters, and said that Graham was coming to Perth from Israel, to which Simon said he knew this as he had been in contact with Graham about Ronald's health. Ronald also said that Josephine was not invited to the Jewish wedding ceremony because of what she had said to Iris at the hospital meeting in early or mid-October 2006.

40 Simon's evidence was that during the conversation he asked Ronald whether Iris knew about the 'the business with Jo', to which Ronald said Iris did not know but he would tell her. It is this evidence which causes me to conclude that the conversation the subject of Simon's evidence was the conversation the subject of Iris's evidence.

41 Simon's evidence was also that he had never discussed with Ronald a 'rape allegation' by Josephine, had never said to Ronald 'Well, you have to prove it in court that you didn't do it' or words to that effect and had never given Ronald advice about the matter concerning Josephine.

42 In respect of the second matter, it was Simon's evidence that Simon said to Ronald that if Ronald had transferred a half interest to Iris then on his death she would own the entire land, regardless of Ronald's will. Simon tried to explain survivorship to Ronald, but he concluded Ronald did not understand the difference between joint tenancy and tenancy in common. Simon asked Ronald to rectify the situation by having Iris transfer her interest in the Property back to Ronald, saying that if Iris did this Ronald would have full control of the land and be able to deal with it as he wished, and if Iris did this Simon would admit he was wrong about his attitude towards Iris.

43 On the evidence of Iris on 28 April 2007 there was a 'further telephone conversation', on this occasion between Josephine and Ronald, which she also overheard. In that conversation Josephine said words to the following effect:

You have given this and that to Iris, but if you don't do it my way I'm going to tell the Jewish community that you raped me. I have pictures and other proof. I have complained to Rabbi Frielich and others.

44 Josephine in her testimony denied she used the words Iris attributed to her, or any words to that effect.

45 On Iris's evidence Ronald had told Iris and Dr Phua that he believed Josephine was 'dangerous' and that she had previously been treated in a psychiatric hospital.

46 On the evidence of Josephine on or about 28 April 2007 there was a telephone conversation between her and Ronald in which he asked her, repeatedly, to 'forgive' him, to which she said 'Forgive you for what? Are you asking me to forgive you for what you did me over my lifetime?', which Ronald did not answer. Iris in her testimony denied that Ronald used any such words with Josephine in that conversation.

47 On 30 April 2007 Josephine by her solicitors Birman & Ride commenced proceedings in the Magistrates Court to recover $10,000 from Ronald (Josephine's Magistrates Court Proceedings). Her evidence was that this amount was made up of two amounts of $5,000 each, one she lent to Ronald on or about June 2003 and the other she lent to him on or about June 2006. It was also her evidence that until a conversation she had had with Simon's wife in April 2007 Josephine had had no discussions with either of her siblings concerning Ronald's will or the Property. Although after this conversation she still thought Ronald was obliged 'under the Inheritance Act' to make provision for her and her siblings and would do so, she had instructed Birman & Ride, solicitors, to commence Josephine's Magistrates Court Proceedings to establish her claim against his estate in case it transpired that Iris received everything. She also testified that she had not had Josephine's Magistrates Court Proceedings issued to put pressure on Ronald to alter his will or the title to the Property. This evidence was not challenged.

48 On the unchallenged evidence of a Stanley Murray Fletcher, who had known Ronald for some time as a fellow member of the Perth Lions Club, Ronald had told him during a visit Mr Fletcher made to Ronald at the Hollywood Palliative Care Unit that Ronald was not going to agree to leave the Property to his three children as he wanted to make provision for Iris. It appeared not to be in contest that this visit by Mr Fletcher, as a long-time acquaintance of Ronald's, had occurred in early May 2007.

49 Also at about the same time, on the evidence of Iris, Ronald had told her she should get herself a lawyer, as 'my children are determined that you will be left with nothing'.

50 On the unchallenged evidence of Simon, at about the same time, on 3 May 2007, Graham arrived in Perth from Israel to see Ronald before he died.

51 On 4 May 2007 Ronald instructed Paiker & Overmeire to prepare a transfer of Iris's interest in the Property from Iris to Ronald and a transfer of land form T1 under the Transfer of Land Act for that purpose was prepared (the form for a Transfer from Iris to Ronald). On the same date Ronald telephoned Simon to say he was going to ask Iris to transfer her interest in the Property back to Ronald, and to tell Simon to collect the necessary documents from Parker & Overmeire. Also on 4 May 2007 Mr Paiker showed Simon the form for a Transfer from Iris to Ronald together with a letter from Paiker & Overmeire to Ronald confirming instructions to prepare that document. Late in the afternoon of 4 May 2007 Simon delivered a sealed envelope addressed to Ronald from Parker & Overmeire and marked 'Private and Confidential', which it appears contained these two documents, to Graham and asked him to deliver the envelope to Ronald.

52 On Iris's unchallenged evidence Ronald asked her to sign the form for a Transfer from Iris to Ronald, on a number of occasions, saying that the children wanted her to transfer the Property back to Ronald, which she refused to do.

53 On 6 May 2007 a traditional Jewish marriage ceremony for Ronald and Iris was held at the Property. Graham, but neither Simon nor Josephine, attended. Another of those present at the ceremony was Mrs Tudori who attended it with her husband. At the ceremony, Graham produced a handwritten note, signed by Ronald, and asked Iris to sign it. She refused to do so. The handwritten note (the Handwritten Note) read as follows:

The law at present would be 30%? - Iris receives 50% of the sale of the property and the contents of the home. Personal effects belonging to Abigail Stone can be harmoniously taken into possession by the children of Ron Stone. The balance of the estate to be divided amongst the children Simon, Josephine and Graeme Stone.

It is suggested that Simon Stone and Harold Paiker be authorised as the [unclear].

54 Later on the same day, 6 May 2007, on the evidence of Simon he received a telephone call from Graham in the course of which Simon spoke with Ronald. Ronald said that Iris had refused to sign the transfer of her half of the Property back to him, his wallet and chequebook were missing from his jacket pocket, he had asked Iris where they were and Ronald wanted to know what to do. Simon told Ronald he did not want to become involved, but he would arrange for a lawyer to visit him. Ronald asked Simon to arrange this, and Simon arranged for Jeremy Birman to visit Ronald in the Hollywood Palliative Care Unit. Simon's evidence was that his purpose was that Mr Birman should provide Ronald with whatever advice Ronald needed.

55 Still later on the same day Mr Birman and Clinton Peter Kevin Russell, both from Birman & Ride, solicitors, met with Ronald at the Hollywood Palliative Care Unit. Their conversation with Ronald was recorded digitally and a transcript of the recording was in evidence before me. There was no challenge to the accuracy of this transcript. I understood it to be before me as evidence of Ronald's state of mind and his other condition on the occasion in question, as well as what was said to him and by him then.

56 The transcript includes the following, in the order in which the exchanges proceeded (I follow the transcript in italicising Ronald's words):

• Ronald referred to having meals with Iris, asking her to be his carer and applying for a visa for her, saying in the application she would look after him and eventually they would marry; eventually they had married, '[l]ast September', and had also had a Jewish ceremony that day (being 6 May 2007); however, the children had not 'taken' the marriage to Iris 'very well';
• Ronald said that that, following the marriage in September, he had written 'to my son and I wrote to his lawyer and I told him please revoke all former', and Ronald had made a 'new Will';
• Ronald referred to putting the Property into Iris's name, saying it was '[m]y idea', Iris had not suggested it: he wanted to 'get her a bit of security' so as to 'help strengthen our case' for Australian citizenship;
• Ronald, when asked what effect he wanted to have 'these documents to have', replied '[i]f anything happened to me she would have somewhere to live and stay in Australia';
• Ronald, when asked '[s]he would get the entire house?', said that he did not 'realise the complications', explaining that meant '[t]hat the children could take her to court etcetera etcetera and that I had made sure that I left the kids something hoping it wouldn't come to a court case';
• Ronald added he wanted 'so much for her and the balance [for] the kids', and, when it was suggested to him that would not have happened if she 'owned the house', replied 'I don't know';
• Ronald, when asked what he wanted to happen, said he wanted to 'stall everything until tomorrow morning' but 'I was told it might be too late';
• Ronald, after he was asked whom he wanted the Property to belong to, said he wanted the Property to 'revert back to the original owner, myself', adding '[t]he law has been broken';
• Ronald, after he was asked '[w]hy should the law have been broken?' and if 'somebody' had told him the law had been broken, replied '[b]ecause I asked her to fill out these forms today';
• Ronald, when asked what form he wanted Iris to fill out, referred to a document he had dictated to Graham, and, when the words 'the law at present should be 30%? Iris receives 50% of the sale of the property and the contents of the house. Personal effects belonging to Abigail Stone', were read out, Ronald said '[m]y previous wife';
• Ronald, when he was asked again what he wanted to have happen 'as far as the house is concerned', and after one of those at the meeting said to him 'the present situation is that when you die she will own the whole house do you understand that? Is that what you want?', said

No to virtually say I have been conned if that actually happened. I would like to think I haven't been conned. I know you can't go both ways but that's my general feeling.;

• Ronald, when one of those at the meeting said to him that 'at the moment you own a half share in the house still', and was asked '[d]o you want to transfer that to anyone else?', said '[t]ransfer to my children';
• When one of those at the meeting said to him that if he transferred the Property

then you couldn't change your mind because you ... The situation would then be that Iris would end up with half of the house and your children would end up with the other half

• Ronald, when asked '[i]s that what you want?', said '[y]es if it stops her selling', referring to the Property;
• Ronald, after being told that one or other of the holders of interests in the Property 'could force the sale of the house', but that the proceeds would be split '50/50', and being asked whether that was what he wanted, said '[y]ep' and added '[b]y the same token I would like to be able to wait until tomorrow morning';
• Ronald, after one of those present at the meeting asked him if he would like to get some legal advice, and whether there was someone he would like, had responded '[w]hat's wrong with you Sir?';
• When Ronald was told that the person speaking to him was 'your daughter's lawyer and she rather wants the house transferred to her or half of it', and that person did not want 'there to be any suggestion that I am forcing you to sign the documents', Ronald responded

[n]o, certainly. Sign it. I'm not under duress or anything like that.

• One of those present at the meeting then said that he would 'much prefer' Ronald talk to his own lawyer before signing the documents he had given Ronald, adding he 'would have a conflict because I am acting for her. I am grateful for you talking to me but you don't have to obviously', to which Ronald responded, with the exchange between that person and Ronald continuing thereafter, as follows:

My son told me to see you.

Well I have spoken to him but of course he and your daughter have the same interest as they all want ... I can't do anything about Iris has already got half of the house and I can't unless she agrees to hand over her half that's the way it will stay. You at the moment own the other half and it is possible for you to transfer that what you own.

You tell me then could she borrow against one, her half share or something like that.

As things stand when you die she will own the whole property and no doubt she can borrow against that. If you transfer your share to you [sic] son, your sons and your daughter then I don't think anybody can borrow, the only way they can get money is to sell the house.

I would do that ... I would be prepared to transfer to my children.

• One of the persons present then said to Ronald that

the best thing to do would be that we will prepare a transfer but I think it would be good if someone could come and see you an independent lawyer coming to confirm to you what the document says and make sure that you are happy to sign it in the morning

• When one of those present at the meeting asked Ronald if there were a lawyer that person could contact for Ronald, Ronald said '[n]ot at this stage' adding, when asked whether he was 'happy for me to prepare a transfer and we'll deal with it in the morning', 'yes';
• Ronald, when asked 'do you want to make a new Will?', said 'I will make a new Will eventually yes';
• Ronald said, when some one present at the meeting asked Ronald towards the end of the meeting 'do you want to leave [matters] at that?',

The other question is if I may. Is there any merit in me now I have phoned her a couple of times I said, I stalled her, 'I said there is somebody here I owe money to and I haven't got my cheque book'. It was a lie, I know. I don't normally tell lies but I said it deliberately as a trap: 'will you bring over some money, my wallet' and she said it's in my bag. I said my cheque book. It's in the bag. I said that will be good. And my credit card. She said everything is in the bag here for you. She said I will see you in the morning.

• Ronald also said, when some one at the meeting said '[s]he hasn't come',

She hasn't come. I phoned at home a couple of times there is no answer. She sounds as though she was knocked out you know she really worked her guts out. She made the place nice. She did a lot of the catering. I'm the sort of bloke ... I know it's silly but I see the good in everything.

57 On the morning of 7 May 2007, on Josephine's unchallenged evidence Mr M drove Ronald, Josephine, Graham and Iris together in his car to celebrations of the commemoration ceremony of the Battle of the Coral Sea.

58 Also on 7 May 2007, Mr Birman and Mr Russell, together with a Rodney Stephen Aldus, an employee of Birman & Ride, again met with Ronald at the Hollywood Palliative Care Unit. On this occasion Dr Phua was also present. The conversation with Ronald was also recorded digitally and a transcript of the recording was also in evidence before me. As with the previous one, there was no challenge to the accuracy of this transcript. I understood this transcript, like the previous one, to be before me as evidence of Ronald's state of mind and his other condition, as well as what was said to him and by him, on the occasion in question.

59 The transcript includes the following, again in the order in which the exchanges proceeded (again I follow the transcript in italicising Ronald's words):

• Ronald confirmed his understanding of what one of those present at the meeting told him was the effect of his joint ownership of the Property with Iris, that

If I kick the bucket she becomes the owner of the whole house.

• Ronald said, when one of those present said to him he was the lawyer for his daughter, she wanted Ronald to transfer his share of the Property that was effectively a half share to 'Josephine, Simon and Graham, your kids' and that person asked him whether he wanted to transfer his share of the Property to his children, '[y]es';
• One of those present asked Ronald what would happen if he signed the paper transferring his share of the house to the children now and he said '[w]hen I pass away she wouldn't get the lot', and when he was asked what Iris would get, he replied '[s]he'd get 50% or something and let the kids, can get a third share each'.
• Ronald said, when one of those present said to him that Iris got half of the Property and the children got half 'between them' and asked him if that was what he wanted

Not what I want but at this particular stage I will go along with it

immediately after which the following exchange occurred:

Well it's not really a matter of going along with it. If you don't want to transfer your half share to the kids ...

Well I certainly will at the present moment.

• Ronald said, after one of those present at the meeting had shown him a transfer of land and explained features of the document to him, indicated he would not sign immediately, confirming he was 'stalling' adding '[b]ecause I am quite confident that there's a misunderstanding. In my opinion. It's probably not worth much.'
• Ronald said, after one of those present had said he had suggested to Ronald the previous day he get a lawyer, that the person speaking was not his lawyer but his daughter's lawyer, Ronald could get a lawyer to come and represent him, Ronald did not have to sign and that person asked him if he understood that and whether he would like a lawyer to come and see him, '[a]t the present moment I would say no';
• Ronald said, when one of those present asked him if wanted to do anything about making a new will at that stage, '[a]t the present moment no';
• Ronald said, when one of those present told him that if he wanted to execute the transfer there was no deadline for the purpose, but that if he did not when he died his half of the Property would belong to Iris, that his understanding then was that 'the children will have nothing' and added 'I am not a gambling man. I'd like I would be prepared at this stage to sign half. The kids own half', later stating 'I wish to sign it. I'd like to do it that way. At least the kids are covered. If I sign now I'll gamble on half';
• Then ensued the following exchange:

I am not sure what you mean by gamble. It's up to you.

I might have to change it again.

Well you are leaving the run a bit late I think. That's up to you of course. Not something you want to be bothered with every day I shouldn't think.

No. Okay say it's 3 o'clock today we sign it.

Alright well do you want us to be here or do you want to do it by yourself?

No, I'll do it now in front of you fellas. I want to get our witnesses together.

60 A short time later Ronald signed the Transfer Form of 7 May 2007 and handed it over to Mr Aldus, Mr Birman or Mr Russell. It appears that the transferees signed the Transfer Form of 7 May 2007 subsequently.

61 Still later on 7 May 2007 Simon visited Ronald at the Hollywood Palliative Care Unit. Ronald told him that he had transferred his interest in the Property to his children and that his children's lawyers needed the certificate of title to the Property and Ronald was going to get it from his study.

62 On the morning of 8 May 2007 Josephine and Graham visited Ronald in the Hollywood Palliative Care Unit. Ronald said he wanted to go to the Property to get his lists of the items he wanted to bequeath to his family. The three went to the Property, and Ronald entered the password on a digital pad to gain entry to the garage and asked Josephine for her key to the Property, which she produced. When she tried to open the door the key did not work. After the three tried other doors it became apparent the locks had been changed. They returned to the Hollywood Palliative Care Unit.

63 On or about 8 May 2007 Mr Birman telephoned David Lenhoff, solicitor of Holborn Lenhoff Massey barristers and solicitors, to have him prepare a will for Ronald after taking his instructions; and on 8 May 2007 Mr Lenhoff visited Ronald at the Hollywood Palliative Care Unit. On Mr Lenhoff's affidavit evidence, Ronald told Mr Lenhoff that he wanted to execute a new will naming the plaintiffs as his residuary heirs and Simon as executor, that he wanted to give his half interest in the Property to the plaintiffs and that he had signed a transfer of land document for that purpose. In his crossexamination Mr Lenhoff testified that, while he was aware that Ronald held the Property jointly with Iris, he could not 'independently recollect' whether, at the time he took the instructions, he was aware of a transfer of Ronald's interest in the Property from Ronald to the children. Mr Lenhoff's testimony was that after taking instructions from Ronald he learnt from Mr Birman that a certificate of title was needed to complete a transfer of Ronald's interest in the Property from Ronald to the children. Mr Lenhoff's evidence was that during the day on 9 May 2007 he telephoned Ronald and told him of that need, and Ronald said to him he was going to the Property the following day, Thursday 10 May 2007, to get the certificate of title and a list of items he wanted dealt with in his will.

64 On the evening of 9 May 2007 Mr Lenhoff met Ronald at his request. Mr Lenhoff's evidence was that he told Ronald he had prepared a will on Ronald's instructions leaving everything to the plaintiffs equally and appointing Simon as executor. Mr Lenhoff told Ronald that because Ronald held his interest in the Property jointly with Iris she would acquire that interest by survivorship, and he could not deal with it in his will; the children's lawyers needed the title to the Property to register the transfer to the children pursuant to the Transfer Form of 7 May 2007; and if Ronald wanted to discuss that matter he could speak to their lawyer, Mr Birman.

65 Ronald then signed the will (the Will of 9 May 2007) and Mr Lenhoff witnessed the signature.

66 Mr Lenhoff's evidence as to Ronald's capacity to give instructions for the Will of 9 May 2007 was as follows (ts 478):

Did you have any concerns that he may not be able to give you instructions?---No.

You didn't have any?---He was perfectly lucid and I was able to understand him and he was able to understand me.

67 I also note Simon's evidence that as at 7 May 2007, at the time of Ronald's attendance with Josephine, Graham and Iris at the commemoration ceremony for the Battle of the Coral Sea, Ronald's condition was as follows (ts 476):

This is a man who was dying, Mr Hockley, yes, but dad had a lot of strength and he had all his faculties about him. That may be why he took the time that he took to deal with things.

68 The Will of 9 May 2007, having revoked all previous testamentary acts, provided that Simon was to be executor and trustee. Following provision for Ronald's debts and funeral expenses and the trustee's professional fees, administration fees and expenses and any death duty on his estate, there was a single dispositive clause. That clause gave the residuary estate to Graham, Josephine and Simon, in equal shares, and if any of them predeceased him then their share to be held in trust by the trustee for whichever of their children lived to the age of 21 years, if more than one in equal shares, and failing any such children their share to 'my surviving brothers named above'. I note in passing that there was no such person 'named above', unless 'my surviving brothers named above' should be read to refer to Graham and Simon if they survived Ronald. However, the matter was not explored in evidence or submissions before me: in particular, there was no evidence as Ronald having any brother or brothers.

69 There was no evidence before me of any later will or other testamentary instrument of Ronald's than the Will of 9 May 2007.

70 On 10 May 2007 Ronald telephoned Josephine to talk to her about a roster for visits by Iris and the children to Ronald at the Hollywood Palliative Care Unit. It was not clear on the evidence whether this was a conversation to change a pre-existing roster or a conversation about setting up a roster; however, in my view the difference is not material. On Iris's and Josephine's evidence, Josephine's then boyfriend, a Mr M, answered the telephone.

71 On Iris's evidence, Mr M wanted to know if Iris had signed the form of Transfer from Iris to Ronald, and Ronald said words to the effect 'I have to defend and protect my wife', twice, and then Mr M said to Ronald 'You are a weak piece of shit, we are going to say to the Jewish community that you have raped her', and '[h]e said', '[f]uck you and the Jewish community'. On Iris's evidence Ronald did not at any point say to Mr M 'I suppose you think that I am a weak piece of shit'; and Josephine did not participate in the conversation.

72 Josephine's evidence of the conversation did not include any question by Mr M of Ronald as to whether or not he had signed the form of Transfer from Iris to Ronald. On Josephine's evidence Ronald said to Mr M 'I suppose you think that I am a piece of shit', after which Mr M said 'Yes you are; you are a weak piece of shit', at which point she took over the phone from Mr M and spoke with Ronald about the roster. During that conversation Josephine said she was not happy with the roster arrangement as she was not confident of driving at night, and Ronald said 'I have to defend and protect my wife. I cannot let you upset her'. I return to these differences between the accounts of the conversation.

73 Also on 10 May 2007, whether before or after this telephone call, Mr Lenhoff telephoned Ronald. Mr Lenhoff asked Ronald if he wanted Mr Lenhoff to go to the Property to retrieve the title, to which Ronald said he had planned to go himself that day, but had been unable to do so. He added that he intended to go to the Property with Iris to get the title the following day, and he would call Mr Lenhoff when Ronald returned to the Hollywood Palliative Care Unit.

74 On 11 May 2007, apparently in the morning, Ronald and Iris went to the Property to look for the duplicate certificate of title to the Property, but were unable to find it. On Iris's evidence, before she and Ronald did this, she had called Mrs Tudori to seek her advice concerning a person Ronald had said to her was a lawyer who would accompany them on the visit. Mrs Tudori had spoken first with her and then with Ronald on the telephone in Ronald's room in the Hollywood Pallliative Care Unit, and Mrs Tudori had told Iris such an arrangement was 'harassment'; Iris heard her repeat that to Ronald; and there is no evidence any other person accompanied Iris and Ronald on the visit. However, the evidence of Mrs Tudori as to this conversation included no evidence of her having said to Iris or Ronald what Iris's evidence was she had said.

75 On 12 May 2007 Ronald telephoned Mr Lenhoff and said he was going to the Property the following day to get the title. There is no evidence such a visit actually took place.

76 Also on 12 May 2007 Mr Russell handed to Iris a letter dated 11 May 2007 signed by Mr Aldus from Birman & Ride (Birman & Ride's letter of 11 May 2007) requesting that, if she had access to the certificate of title to the Property, she 'deliver it to either Birman & Ride of [sic] Mr David Lenhoff immediately. Otherwise, please contact me urgently to assist us in retrieving the certificate of title'.

77 On 13 May 2007 Mr Lenhoff visited Ronald at the Hollywood Palliative Care Unit and asked him if he still wished to transfer his interest in the Property to the plaintiffs. In his testimony Mr Lenhoff said he had no doubt on that account, but that he 'would have checked with [Ronald] because it was quite a big thing he was trying to do'. Ronald indicated he did wish to transfer his interest in the Property to his children.

78 On 15 May 2007 Mr Lenhoff posted to Iris by ordinary post a letter of that date. In that letter (Mr Lenhoff's letter of 15 May 2007) Mr Lenhoff referred to instructions he said he had received from Ronald 'on numerous occasions' as to Ronald's wishes to transfer the Property to the plaintiffs, and Mr Lenhoff's requirement for the duplicate certificate of title to the Property 'to give effect to my client's instructions'.

79 Mr Lenhoff's letter of 15 May 2007 also said that the duplicate of certificate of title was

currently at the Property and, for reasons well known to you, my client is unable to retrieve it. You are the only other person who has access to the premises on the Property.

80 In that letter, Mr Lenhoff requested that Iris telephone him 'urgently' to

make arrangements for me to collect the certificate of title so that the necessary steps can be taken to give effect to my client's wishes to convey his joint interest in the Property to his children.

81 On the evening of 15 May 2007 Mr Lenhoff went to the Hollywood Palliative Care Unit to visit Ronald. Iris was there with him; he was asleep. After Iris refused to take a copy of Mr Lenhoff's letter of 15 May 2007 and asked Mr Lenhoff to leave it in Ronald's room, Mr Lenhoff left it there. Iris's evidence was that she did not see the letter.

82 Iris's evidence was that subsequent to this exchange she again searched the Property for the duplicate certificate of title. Her affidavit evidence was that this search occurred '[a]fter receiving the letter of demand for the duplicate Certificate of Title on 15th May 2007'. However, in her crossexamination she testified that by 'letter of demand' she had meant to refer to the form for a Transfer from Iris to Ronald. The search at the Property on her evidence occurred before 17 May 2007, as will shortly become clear. In that search Iris discovered the duplicate certificate of title to the Property, in her 'personal file' in the bedroom she had shared with Ronald. On her evidence she had not put the duplicate certificate of title there and believed that Ronald must have put it there.

83 On 16 May 2007 Mr Lenhoff delivered to the Hollywood Palliative Care Unit documents being the Application for a New Duplicate Certificate of Title, the Application to Dispense with the Duplicate Certificate of Title and, without handwritten amendments, the Statutory Declaration. All of these documents had been prepared by Birman & Ride. Mr Lenhoff told Ronald when he delivered the documents that, as the children did not have the title, their lawyer had asked that Ronald sign the documents to assist with the registration process. Mr Lenhoff had also told Ronald to read the documents carefully and sign them if he was satisfied with them. Ronald told Mr Lenhoff that the Statutory Declaration par 8 was incorrect and Ronald wanted it amended. On Mr Lenhoff's testimony in cross-examination, Ronald made handwritten changes to par 8, which he and Mr Lenhoff then initialled. After handwritten amendments to par 8 had been made Ronald signed each of the documents and Mr Lenhoff witnessed his signature. From what on 16 May 2007 Mr Lenhoff told Ronald, that as to those documents, as the children did not have the title, their lawyer had asked that Ronald sign the documents to assist with the registration process, and from Birman & Ride having on 23 May 2007 lodged with the Registrar of Titles the Applications and the Statutory Declaration, I would infer that following the execution of those documents Mr Lenhoff within Ronald's authority delivered them to Birman & Ride.

84 Paragraph 8 of the Statutory Declaration as delivered to Ronald read, in respect of what is referred to as Ronald's return to the Property on 11 May 2007 to search without success for the duplicate certificate of title, 'I asked the other registered proprietor of the land where the duplicate Certificate of Title was and she did not tell me.' The amendment was to cross out 'tell me' and replace it with 'know and she was looking for it too. She accused me of giving it to someone.'

85 On 17 May 2007 Iris delivered the duplicate certificate of title to the Property to her solicitors Nielsen & Co, and by letter of that date (Nielsen & Co's letter of 17 May 2007) from those solicitors to the Registrar of Titles they informed the latter that Elliot Nielsen of that firm held that duplicate certificate of title for safekeeping.

86 Nielsen & Co's letter of 17 May 2007 went on to say that Ronald 'may have been prevailed upon by others to make an application for a replacement duplicate certificate of title, and utilise it in a dealing to the detriment' of Iris, adding that the duplicate certificate of title was 'not lost', and that

those who may wish to obtain a duplicate certificate of title as a replacement are well aware that it is not lost, but properly and lawfully in the possession of [Iris], and her solicitor.

In the event that any application for a lost certificate of title has been made, I ask that you inform this office of any such application, and deal with such application in the light of this information.

87 It is not in contest that the Registrar of Titles, as a result of receiving Nielsen & Co's letter of 17 May 2007, placed the certificate of title to the Property in Registrar's Packet K 200572, the purpose of which, as described in the letter dated 23 May 2007 of the Registrar to Elliot Nielsen of Nielsen & Co (the letter from the Registrar of Titles of 23 May 2007), was to give notice to persons searching the title that the Registrar of Titles was to monitor dealings in relation to the Property 'in order to prevent improper dealings due to correspondence received'.

88 On 18 May 2007 Birman & Ride lodged the original Transfer Form of 7 May 2007 at the Office of State Revenue for assessment of stamp duty.

89 It is common ground that on 23 May 2007 Birman & Ride lodged with the Registrar of Titles three sets of documents.

90 One such set of documents, which became Caveat K195526 (the plaintiffs' Caveat), showed on the Caveat Form C 1 under the Transfer of Land Act, dated 17 May 2007, the plaintiffs as Caveator and the estate or interest being claimed as '[a]n equitable interest as owner of [the Property]' by virtue of the Transfer Form of 7 May 2007. The letter of the Registrar of Titles of 23 May 2007 drew the attention of Mr Nielsen to the plaintiffs' Caveat.

91 Another such set of documents, which became Application K202077, comprised the Application for a New Duplicate Certificate of Title and the Statutory Declaration. The Application for a New Duplicate Certificate of Title stated as the reasons for the application that 'the current duplicate Certificate of Title has been lost'.

92 The third set of documents, which became Application K202078, comprised the Application to Dispense with the Duplicate Certificate of Title.

93 On 26 May 2007 Iris signed a Caveat Form C 1 under the Transfer of Land Act, dated that date, which it appeared to be common ground was lodged on 28 May 2007 (the second defendant's Caveat). The second defendant's Caveat showed her as Caveator and the estate or interest being claimed 'as joint tenant', by virtue of the matters set out 'in the Statutory Declaration of the Caveator declared the 26th May 2007'. That statutory declaration (the second defendant's Statutory Declaration) referred among other things to a conversation Iris declared she had with Ronald at about 7 pm on 28 April 2007 in Ronald's room at the Hollywood Palliative Care Unit. In that conversation Iris said Ronald told the second defendant Josephine was blackmailing him over a complaint Josephine had made against him approximately 30 years earlier that Ronald had sexually interfered with Josephine. The second defendant's Statutory Declaration also referred to a telephone conversation on the same date, 28 April 2007, between Josephine and Ronald in which the second defendant heard Josephine use words to the effect that if Ronald did not do what Josephine wanted she would expose him to the whole Jewish community as a rapist. The second defendant's Statutory Declaration added that Ronald had stated to the second defendant that 'because of this' he wanted to transfer his joint tenancy in the Property to his three children, including Josephine. The second defendant's Statutory Declaration is stated to be in support of an absolute caveat over the interest of Ronald in respect of the Property to prevent 'improper dealings'. The contents of the second defendant's Statutory Declaration are for the most part reproduced in a further statutory declaration of 13 July 2007 which was lodged under the Transfer of Land Act in response to requisitions of the Registrar of Titles for the purposes of the second defendant's Caveat.

94 As I have previously indicated, on 27 May 2007 Ronald died.

95 I turn now to describe the present proceedings and the evidence before me.

The present proceedings and the evidence before me

96 The present proceedings were brought by originating summons filed on 5 July 2007.

97 There were some difficulties encountered in the fixing of a date of appointment to hear the originating summons, and on 19 April 2010 I heard and dismissed an application by the second defendant to vacate the listed date of the appointment to hear the originating summons, that date being 23 April 2010.

98 On 23 April 2010 the parties appeared before me. There was substantial argument devoted to whether or not the plaintiffs had been taken by surprise by the second defendant taking the position that the hearing should be to consider a wider range of issues than the plaintiffs had come prepared to address. The plaintiffs' position was that those issues were confined to whether or not Ronald had made a gift which equity would recognise, in the sense of making its remedies available to perfect, to the children of his interest in the Property (the issue of perfect gift). The second defendant's position was that the issues between the parties also extended to whether or not Ronald had capacity to make that gift (the issue of capacity); and whether or not the gift should not be recognised on one or more of the bases of duress (the issue of duress) or undue influence (the issue of undue influence). During the hearing the second defendant indicated through her counsel she was content to have the hearing on the originating summons on the issue of perfect gift, and not on the issues of capacity, duress and undue influence. The parties then made submissions as to the evidence properly before me on the issue of perfect gift, and I made rulings on the parties' submissions that had the effect of defining that body of evidence. I also made provision for further submissions on the issue of perfect gift to be made subsequently to the hearing, including oral submissions.

99 On 19 May 2010 further matter to correct what had been in the affidavit of counsel for the plaintiff upon which I had relied at the hearing of 23 April 2010 was drawn to my attention. This correction persuaded me that I should adjourn the hearing to allow the parties a limited time to file further affidavits with respect to the further issues I identified in the written submissions for the second defendant filed for the purpose of the hearing on 23 April 2010, and with leave to identify deponents for the purposes of crossexamination of them.

100 On 13 July 2010 at a directions hearing before me the issues for the resumed hearing on the originating summons were identified in orders for a resumption of the hearing of the originating summons of that date (the Orders of 13 July 2010) as to the issues of duress, undue influence and capacity, as well as whether the gift should not be recognised on the basis of an unconscionable dealing with Ronald (the issue of unconscionability). Provision was made for closing addresses to be with respect to those issues as well as the issue of perfected gift. In addition, the affidavit evidence was also identified subject to objections to be dealt with.

101 On 20 August 2010 there was a hearing to settle the revised dates for the resumed hearing on the originating summons.

102 On 16 September 2010 the second day of hearing of the issues arising out of the originating summons took place, with counsel for the second defendant opening. The affidavit evidence for the second defendant was dealt with by confirming the parts of it previously accepted to be in evidence and, after the determination of objections, by the admission into evidence of further paragraphs from those affidavits. In some cases leave was granted to ask questions in examination in chief on certain matters.

103 On 17 September 2010 the third day of hearing of the issues arising out of the originating summons took place, with further affidavit evidence for the second defendant dealt with as on the second day of hearing of the issues arising out of the originating summons, as well as the admission of evidence from further affidavits for her, and the taking of testimony from deponents of some of the affidavits so in evidence.

104 On 24 September 2010 the fourth day of hearing of the issues arising out of the originating summons took place, with testimony from one of the deponents of affidavits in evidence for the second defendant, the admission into evidence for the second defendant of affidavits of two other deponents and testimony from deponents for the plaintiff and admission into evidence of further affidavit evidence for the plaintiff.

105 On 28 September 2010 counsel made closing oral submissions having lodged written submissions and other materials for the hearing and referring also to written submissions and other materials previously lodged for earlier hearing days.

106 Thus, the evidence before me, apart from evidence in the form of a copy of the certificate of title to the Property showing registration date 14 March 2007 (exhibit 1) and a Landgate sale inquiry document as at 22 April 2010 (exhibit 2), was the following.

107 There was matter in affidavits for the second defendant, and in the cases of some of the deponents testimonial evidence, as follows:

• Affidavits of Iris, sworn 8 October 2007 as to certain parts and certain annexures only (exhibit 3) and 4 September 2009 as to certain parts and one annexure only (exhibit 11), as well as testimony from Iris;
• An affidavit of Mr Cohen, sworn 4 September 2009 (exhibit 4), as to certain parts only, as well as testimony from Mr Cohen;
• An affidavit of Mr Fletcher, sworn 24 November 2009 (exhibit 9), as to certain parts only;
• An affidavit of Mrs Tudori, sworn 8 October 2007 (exhibit 10), as to certain parts only;
• An affidavit of Anne Fergusson-Stewart, sworn 24 November 2009 (exhibit 12), as to a single paragraph only: I consider no further reference to her evidence is necessary in these reasons; and
• An affidavit of Dr Chong, sworn 26 November 2009 (exhibit 13), as to certain parts only.

108 There was matter in affidavits for the plaintiffs, and in the cases of some of the deponents testimonial evidence, as follows:

• Affidavits of Mr Aldus, sworn 5 July 2007 and its annexures (exhibit 5) and 31 May 2010 (exhibit 16);
• Affidavits of Simon, sworn 4 July 2007 and its annexures (exhibit 6) and 31 May 2010 (exhibit 14), as well as testimony from Simon;
• An affidavit of Mr Lenhoff, sworn 5 July 2007 and its annexures (exhibit 7), as well as testimony from Mr Lenhoff;
• An affidavit of Mr Russell, sworn 5 July 2007 and its annexures (exhibit 8); and
• An affidavit of Josephine, sworn 31 May 2010 as amended (exhibit 15) as well as testimony from Josephine.

109 I should note that at a number of points in Iris' testimony in the hearing it was evident that she had some difficulty arising out of the fact that English was not her first language. However, I formed the view that it was not necessary for me of my own motion to appoint an interpreter for her; nor did her counsel seek to persuade me otherwise.

110 As I have indicated, the issues in this case as they developed over the course of the proceedings before me are five. They are:

111 I deal with each of these issues separately, considering first the applicable principles and then applying them to the facts as I find them to be.

112 The final section of my reasons is my conclusion and call for orders. In that section I deal separately with a matter as to costs that had been raised with me during the course of the hearing on 19 May 2010.

The issue of perfect gift: applicable principles

113 The principles I describe are ones on which there appeared to be no issue taken by either party, except as indicated.

114 For the plaintiffs to have interests in the Property, as tenants in common in equal shares being equitable owners of an undivided half interest in the Property, with the second defendant having an interest in the Property as tenant in common with them of the other undivided half interest in the Property, and with the parties entitled to be registered as the proprietors of such interests under the Transfer of Land Act, there had to have been an effective alienation in equity to the plaintiffs of Ronald's interest in the Property. The burden was on the plaintiffs to show such an alienation.

115 Such an alienation would work a severance of the joint tenancy in the Property of Ronald and Iris, and would not require consideration or the conferral of legal ownership on the plaintiffs. It would be sufficient if there was a voluntary alienation which equity would recognise as a perfect gift. See Corin v Patton [1990] HCA 12; (1990) 169 CLR 540, 546 550 (Mason CJ and McHugh J) and 572 576 (Deane J); and Bradbrook et al, Australian Real Property Law (5th ed 2011) [12.360] [12.365].

116 For there to have been a perfect gift, the donor must have done everything which it was necessary for him to have done to effect a transfer of legal title. See Bradbrook et al [12.365] quoting from Corin (559) (Mason CJ and McHugh J) and (582) (Deane J, discussing rule in detail). If the donor's conduct has failed to meet that standard, then the gift is imperfect and equity will not make its remedies available to perfect the gift, remedies which include recognition of an equitable interest in the donee. See Corin (557) (Mason CJ and McHugh J).

117 Further, for there to have been a perfect gift, the donor must have done what the donor did with the intention of parting with the donor's interest so that as against the donor the donee is entitled to obtain the legal title to the donor's interest. See Public Trustee v Jones [2007] SASC 390 [53] [54] (Layton J), referring to Cope v Keene (1968) 118 CLR 1, 6 7 (Kitto J, McTiernan J agreeing).

118 For the donor to have done everything which it is necessary for him to have done to effect a transfer of legal title requires the donor to have placed the effecting of the transfer within the control of the donee and beyond the control, recall, intervention or need for further assistance of the donor. See Corin (582 583) (Deane J), (559) (Mason CJ and McHugh J).

119 The fact the donor has died after doing all that it is necessary for him to have done to effect a transfer of legal title does not affect the fact that a severance has been worked in equity. See Bradbrook et al [12.365] n188, citing Watt v Lord [2005] NSWSC 53; (2005) 62 NSWLR 495 (which states that this proposition appears to be the 'better view').

120 However, where a certificate of title has been issued, and is held by or for the donor and the non-assigning joint tenant, the donor has not done all that is necessary for him to have done to effect a transfer of legal title simply by executing the transfer of his interest and delivering it to the donee/transferee while also requiring the non-assigning joint tenant to deliver the certificate of title to the transferee, and notwithstanding that the non-assigning joint tenant is compellable for this purpose. The incompleteness lies in the revocability of the requirement to deliver. See Costin v Costin (1997) 7 BPR 15,167, 15,168 (Sheller JA) and 15,170 (NSW CA: Brownie JA, Powell JA agreeing); and Motor Auction Pty Ltd v John Joyce Wholesale Cars Pty Ltd (1997) 23 ACSR 647, 655 656 (NSW SC: Santow J); see also Bradbrook et al [12.365] and [12.370]. The gift is not perfect until the non-assigning joint tenant produces the certificate of title to the donee/transferee: Motor Auction (656).

The issue of perfect gift: application of the principles

121 Here I consider I should infer Ronald intended to make a gift of his interest in the Property, beginning when he signed the Transfer Form of 7 May 2007 and delivered it to the solicitors for the plaintiffs, Birman & Ride, and continuing thereafter. I so infer from that conduct and the evidence of his intentions in Ronald's conversation with the solicitors from Birman & Ride of 7 May 2007, his subsequent attempts to obtain the duplicate certificate of title, Mr Lenhoff's conversation with him of 13 May 2007, Mr Lenhoff's letter of 15 May 2007 and the Applications.

122 Counsel for the second defendant put to me that on the unchallenged evidence of Iris as to her discovery of the duplicate certificate of title it was possible Ronald knew the whereabouts of the duplicate certificate of title and thus he 'knowingly failed to perfect the gift'. I took this to be a submission that I should conclude the plaintiffs had failed to show an intention by Ronald to part with his interest in the Property. However, I consider that in the face of the other evidence to which I have referred Iris's evidence does not lead me to the conclusion described.

123 Here there was a requirement to deliver the duplicate certificate of title to be found in the direction to produce it in Mr Lenhoff's letter of 15 May 2007, which I accept, on the evidence that Mr Lenhoff was Ronald's solicitor, was sent to Iris within Ronald's authority. I recognise that Mr Lenhoff was chosen by Birman & Ride, that he had previously indicated to Ronald at their meeting of 9 May 2007 that the children's lawyers needed the title to the Property to register the transfer to the children pursuant to the Transfer Form of 7 May 2007 and that Birman & Ride's letter of 11 May 2007 in its call for delivery of the duplicate certificate of title referred to delivery to either that firm or Mr Lenhoff's firm. However, I do not consider that this is sufficient to indicate that Mr Lenhoff was not acting within his client's authority.

124 However, Ronald's delivery of the executed Transfer Form of 7 May 2007 and the sending to Iris of the direction to produce the duplicate certificate of title in Mr Lenhoff's letter of 15 May 2007 would not suffice to make the alienation of Ronald's interest in the Property effective in equity. That is because Ronald's direction to produce should be taken as revocable, and because of the failure by Iris as joint tenant to make the duplicate certificate of title available to Ronald before his death: see Costin (15,168 and 15,170); and Motor Auction (656) (on Costin).

125 Counsel for the plaintiffs put to me that the present case is distinguishable from Costin because, as I understood his submission, here there was not only the direction to produce in Mr Lenhoff's letter of 15 May 2007 but also the facts that Ronald had sought to locate the duplicate certificate of title, enlisting the aid of Iris for the purpose; and, when the duplicate certificate of title could not be located, Ronald had completed the Applications. This showed a level of action by the donor to effectuate his gift greater than that in Costin. Further, I understood the submission for the plaintiffs to be that the present case was distinguishable from Costin on the basis that in that case the donor had, subsequently to the issue of the direction to produce, executed a further transfer of the land in favour of another and that transfer was registered. This was taken in Costin to have shown a change of mind: (15,168 15,169) (Brownie JA). Here there was (as I accept) no evidence of a change of mind.

126 However, I do not consider that either difference distinguishes this case from Costin for my purposes.

127 From Costin it is not the level of action by the donor that is determinative, but its quality, as answering the description in Corin (559) (Mason CJ and McHugh J) and (582) (Deane J). If the direction to produce is revocable, as on Costin (15,168 and 15,170) and Motor Auction (656) I consider the direction here must be seen to be, it is not binding on the donor and the gift is incomplete, unless the duplicate certificate of title is in fact produced to the donee/transferee. See for this analysis Costin (15,170) (Brownie JA).

128 Further, it is not sufficient that there may be an opportunity for the donee to secure the registration of the transfer without production of the certificate of title of the sort in Conveyancing Act 1919 (NSW) s 36(6)(b)(ii) and s 38, referred to in this connection in Costin (15,169) (Brownie JA). I note that there is a provision for registration of a dealing without the production of the certificate of title in Transfer of Land Act s 74 read with s 52 and s 56. As events have indicated, these provisions were not taken by the Registrar to confer a right to registration at least in the circumstances of this case, and it was not put to me the Registrar was in error in that respect.

129 In my view, then, notwithstanding Transfer of Land Act s 74 read with s 52 and s 56 and the Applications, in this case so long as the duplicate certificate of title had not been produced, and Ronald had control of the duplicate certificate of title (through the power of revocation of the direction to Iris to produce), Ronald retained the power to thwart the claimed gift to the children of Ronald's interest in the Property within Corin (560).

130 It would follow that the claimed gift to the children of Ronald's interest in the Property should be considered to be an imperfect one which equity would not make its remedies available to perfect.

131 However, it might be put against arriving at any such conclusion, as counsel for the plaintiff appeared to do, that it would prevent effect being given to the clearly established intention of a donor to make a gift, an intention frustrated by actions of another who stood to lose from the gift and who was acting at a time when it was evident the donor had little time left to live. I accept the evidence establishes all of these matters in this case. I should add that on the evidence it is not clear that Ronald was guilty of procrastination in relation to the making of his intended gift, although no argument was directed to me on that point. Compare the observation as to the facts in Rutledge v Sheridan [2010] QSC 257 [40] (Daubney J).

132 However, a clearly established intention to make a gift is not determinative of whether a gift has been perfected: see Costin. Nor should the result be any different simply because the accomplishment of such an intention is prevented by another who might be said to have an interest in that intention not being accomplished, and indeed might have been compelled by the intending donor to permit its accomplishment: see Motor Auction. And there is no indication in the authorities I have found that the result should be different if such an intention is established in the context of the established absence of procrastination by the donor.

133 At the same time, does it make a difference that Ronald died with a will appointing one (only) of the donees, Simon, the executor and trustee under Ronald's last will? For the plaintiffs it is put that there is such a difference, on the rule in Strong v Bird (1874) LR 18 Eq 315. I turn to the statement and conditions for the application of that rule, and its application in this case.

The issue of perfect gift: whether the rule in Strong v Bird applies here

134 There is a 'clearly established' exception to the maxim equity will not make its remedies available to perfect an imperfect gift, including its recognition of an interest created by the gift in the donee, in the rule in Strong v Bird: see Corin (557) (Mason CJ, McHugh J). It is common ground that the burden of proof that the rule applies is on the plaintiffs.

135 That rule may be stated as follows. On the death of an intending donor who has left a will appointing the intended donee the or an executor of the donor's estate, an incomplete gift is treated as completed by the vesting of the legal estate in the intended donee. For this statement, see In re Stewart; Stewart v McLaughlin [1908] 2 Ch 251, 254 (Neville J), cited with apparent approval in Matthews v Matthews [1913] HCA 49; (1913) 17 CLR 8, 15 (Barton ACJ); and see 33 (Isaacs and Powers JJ).

136 The rule applies provided that four conditions (one of which, as will be seen, I have expressed as part of the statement of the rule itself) are met.

(1) the intending donor made a purported immediate gift of specific property to the intended donee which

(2) failed to take effect by way of present gift due to non-compliance with legal requisites for complete divesting of legal title from the intending donor in favour of the intended donee, but where

(3) the intending donor still had when he died the intention that the property should be treated as having been effectually given to the intended donee and

(4) the intending donor left a will appointing the intended donee as the executor or one of the executors of the testator.

138 See Cope (8) (Kitto J, McTiernan J agreeing); and Meagher RP, Heydon JD and Leeming MJ, Meagher, Gummow and Lehane's Equity: Doctrines and Remedies (4th ed 2002) [29025].

139 It has been said that the rule is capable of application where only one of several intended donees is appointed executor of the intending donor's estate: Blackett v Darcy [2005] NSWSC 65; (2005) 62 NSWLR 392 [34] (Young CJ in Eq); and see Ford HAJ and Lee WA: Principles of the Law of Trusts, vol 1 (Update 74) [3340] (no settled rule; citing Blackett). Here of course one (only) of the intended donees (Simon) was appointed an executor under the Will of 9 May 2007, Ronald's last will.

140 It has been held that the rule is capable of application where there is a purported immediate gift of specific property in the form of real property: see Benjamin v Leicher (1998) 45 NSWLR 389, 401 402 (Cohen J). No reason appears to me why this does not apply to land under a Torrens statute such as the Transfer of Land Act, in view at least of s 188 providing for the transfer of the testator's land to an executor or other personal representative, backdated to death.

141 It seems to me that the four conditions for the rule in Strong v Bird to apply have been met here. In particular, the intention to make and steps towards making an immediate gift (conditions (1) and (2)), which intention continued until death (condition (3)), would appear to be met on the facts of the Transfer Form of 7 May 2007 delivered to Birman & Ride and the completion by Ronald on 16 May 2007 of the Application for a New Duplicate Certificate of Title, the Application to Dispense with the Duplicate Certificate of Title and, with handwritten amendments, the Statutory Declaration, against the background of the conversation between Mr Lenhoff and Ronald on 13 May 2007 in which Ronald confirmed he still wished to transfer his interest in the Property to the children, and the absence of any countervailing evidence in respect of such an intention.

142 However, in my view the rule as stated would seem incapable of application to an attempt by a joint tenant to make a gift of the joint tenant's interest. That is because, unless severance occurs before death, the effect of death is to cause the interest of the intending donor to accrue to the surviving joint tenant(s), and the estate of the intending donor cannot include that interest. On survivorship and the estate of a joint tenant, see Bradbrook et al [12.70]. Yet, as noted, the rule in Strong v Bird is that it is the vesting of the property in the donee as executor which perfects the imperfect gift: see In re Stewart (254) (Neville J); Matthews (15) and (33); see also Hardingham IJ, Neave MA and Ford HAJ: Wills and Intestacy in Australia and New Zealand (2nd ed 1989) [3510] ('it is not until the legal interest passes to the personal representative that the principle in Strong v Bird operates').

143 I consider there is no sufficient warrant for an extension of the rule in Strong v Bird as stated to include an attempt to make a gift of a joint tenant's interest. I so consider in view of the approach to the rule described as follows in what appears to be the most recent superior court consideration of the rule, Rutledge [23] (Daubney J) (footnotes omitted) (referring to Meagher et al [29040] and quoting from Blackett [37]):

The provenance and continued application of this 'rule' has been the subject of some serious criticism. In Blackett v Darcy, Young CJ in Equity, counselled strongly against an extension of the rule in Strong v Bird, and referred to authorities suggesting the probability that the High Court would review the rule. His Honour said: 'I am bound to apply it, but as I say, it seems to me the prevailing view is that it is an anomalous rule and should not be extended.'

144 In my view, it follows that the rule in Strong v Bird is of no assistance to the plaintiffs in this case.

145 This conclusion would make it unnecessary to determine, as the second defendant may have sought to have me determine, whether the Will of 9 May 2007 should be disregarded for the purposes of the rule in Strong v Bird on the basis that will should not be recognised on one or more of the grounds of lack of capacity, lack of knowledge and approval of its contents, duress, undue influence and unconscionability. In any event, on the analysis I will reach below, I do not consider any such basis has been established.

146 The conclusion that the attempted gift by Ronald to the plaintiffs should be considered to be an imperfect one which equity would not make its remedies available to perfect, and the conclusion as to the inapplicability of the rule in Strong v Bird, would also make it unnecessary to determine whether or not Ronald's purported gift should not be recognised in equity on the basis he lacked the capacity to make such a gift, or that it was the result of duress or undue influence, or that it represented an unconscionable dealing.

147 However, in the event I am wrong in either one of those two conclusions, and in deference to the body of evidence adduced for the purposes of my consideration of those issues and the substantial argument devoted to them, I will consider those issues.

149 In determining that issue, I understood the second defendant's submissions to include that I should have regard to the evidence of Ronald's capacity to engage in conduct that related to his property at or about the time of the Transfer Form of 7 May 2007, that conduct being the execution of the Will of 9 May 2007. I accept that such evidence is so relevant. However, it is important I note that these proceedings do not require me to determine Ronald's capacity to make the Will of 9 May 2007, or any other matter going to its validity, except as I have already indicated by reference to the application of the rule in Strong v Bird.

150 These proceedings are (as they became after the plaintiffs abandoned their claim for the orders they sought) for declarations as to interests arising from the Transfer Form of 7 May 2007. If the plaintiffs succeed they will have shown a severance of the joint tenancy in the Property by a gift of Ronald's interest in the Property to them. That gift will mean that there will be no interest in the Property that could fall under the Will of 9 May 2007, or indeed under any other testamentary disposition of Ronald's. If the plaintiffs do not succeed, there is the same consequence, by virtue of the law of survivorship.

151 There appears to be no contest as to the applicable principles as to capacity to make the claimed gift to the children of Ronald's interest in the Property. I consider that they are to be drawn from Edna May Collins by her next friend Glenys Lesley Laraine Poletti v May [2000] WASC 29 [53] [62], [68] and [72] (Owen J), a case on a voluntary disposition, and the authorities to which Owen J refers. The following principles so drawn are possibly relevant here:

(1) A voluntary disposition is liable to be set aside for lack of capacity if and only if it can be shown that the disponor lacked the mental capacity required by law for that disposition and that the disponee knew that the disponor lacked that capacity or ought to have been aware of that lack: [53], [57], [68] and [72].

(2) The capacity in question is relative to the particular disposition concerned, and is the capacity to understand the nature of the transaction when it is explained: Collins [58], quoting from Gibbons v Wright [1954] HCA 17; (1954) 91 CLR 423, 438 (Dixon CJ, Kitto and Taylor JJ).

(3) Ordinarily the nature of the transaction in this context is the broad operation, the 'general purport' of the instrument; but in some cases it may mean the effect of a wider transaction which the instrument is a means of carrying out: Collins [58], quoting from Gibbons (438).

(4) The principles applicable to cases of testamentary capacity are largely applicable to voluntary transactions, and resort can be had to the testamentary capacity cases to ascertain the extent or degree of the understanding necessary in a particular case: Collins [59];

(5) The testamentary capacity cases show that the requisite capacity is sufficient mental capacity to comprehend the nature and effects of what the disponor was doing, and its effects; that the disponor was able to realise the extent and character of the property the disponor was dealing with, and to weigh the claims which naturally ought to press upon the disponor: Collins [60], noting the approval in Timbury v Coffee [1941] HCA 22; (1941) 66 CLR 277, 283 (Dixon J) of, and quoting from, In the Will of Wilson (1897) 23 VLR 197, 199 (Hood J); and see Collins [61], referring to Crago v McIntyre [1976] 1 NSWLR 729, 740 741 (Holland J).

(6) If the effect of the voluntary disposition is to dispose of the disponor's only asset of value, the degree of understanding is as high as that required for a will and the disponor must understand the claims of all potential donees and the extent of the property to be disposed of: Collins [62], referring to Re Beaney [1978] 2 All ER 595.

(7) The burden of proof of lack of capacity is on the party seeking to impugn the voluntary disposition: Collins [54].

(8) It is not enough to discharge that burden that the party raises a suspicion or doubt as to capacity: the effect of a doubt is to require a vigilant examination of the whole of the evidence which the parties place before the court; but, that examination having been made, a residual doubt is not enough to defeat the validity of the voluntary disposition unless it is felt by the court to be substantial enough to preclude a belief that the voluntary disposition is that of a disponor who had capacity at the time of making it: Collins [55], quoting from Worth v Clasohm [1952] HCA 67; (1952) 86 CLR 439, 452 453 (Dixon CJ, Webb and Kitto JJ), a testamentary capacity case.

(9) If the burden is discharged, the party seeking to rely upon the voluntary disposition may seek to discharge the burden of showing that the voluntary disposition in fact took place during a lucid interval: Collins [54], quoting from McLaughlin v Daily Telegraph Newspaper Co Ltd [No 2] [1904] HCA 51; (1904) 1 CLR 243, 277 (Griffith CJ).

(10) Where there was a lack of capacity, in approaching the question of whether or not the disponee ought to have been aware of the lack it is not necessary to establish that the disponee had precise knowledge of the disponor's capacity; rather, the focus of attention is on all of the factors surrounding the execution which gave rise to an apprehension that disponor may not have sufficient capacity: Collins [68].

(11) In respect of that focus of attention, it is apposite whether the disponee was aware of circumstances which would raise the possibility of lack of capacity in the mind of any reasonable person: Collins [68] referring to Commercial Bank of Australia Ltd v Amadio [1983] HCA 14; (1983) 151 CLR 447, 467 (Mason J).

(12) The burden of proof that the disponee was aware of the lack of capacity or ought to have been aware of that lack is on the party seeking to impugn the voluntary disposition: Collins [57], [68].

152 In this case, there is a question of the date as at which the capacity in question is to be determined. There are several possibilities at least, on the submissions of the parties as I understood them. One is the date of the Transfer Form of 7 May 2007, that is, that date. Another is the date of the Applications and the Statutory Declaration, that is, 16 May 2007. And still another is both of those dates, so that a lack of capacity on any one of them would discharge the burden of proof.

153 No authority was cited to me on this question. The position of the plaintiffs was that the first listed date, 7 May 2007, was the relevant date. The position of the second defendant appears to have been that the last listed dates, as well as that of the date of Will of 9 May 2007, were the relevant dates.

154 I put aside the Will of 9 May 2007. I do not consider that on any view of the law that date is relevant to any gift of Ronald's interest in the Property to the plaintiffs, except for evidence bearing on his capacity at the relevant time.

155 I consider that on principle the relevant date is that of the last act of the donor which makes the transaction complete so far as the donor is concerned, in the sense of the donor having done everything which it is necessary for the donor to have done to effect a transfer of legal title. It is when the transaction is complete so far as the donor is concerned that the donee acquires an estate or interest in the subject matter of the gift: Corin (559). On that view, and on the submissions for the plaintiffs that Ronald had made 'an irrevocable step in the process of perfecting his gift' by executing 'the transfer and the applications required to apply for registration without the certificate', the relevant date is 16 May 2007.

156 However, there is a further question. If the gift is incomplete, but the exception represented by the rule in Strong v Bird is applicable, what then is the relevant date? On principle, it seems to me that it is the date of death. That is because under the exception it is the vesting of the property in the executor at the date of death that perfects the gift, while it is the intention of the intending donor continuing to death to give the beneficial interest to the executor which countervails the equity of the beneficiaries under the will: Re Stewart (254).

157 I further consider that on this analysis the relevant dates are the same for the other bases on which the second defendant impugns the transaction in this case, undue influence, duress and unconscionability, below.

158 There is a further matter, of whether Ronald in fact knew of and approved the gift on that date. The second defendant places heavy reliance on this matter as well as on that of capacity.

159 In the law of wills, there is a requirement of knowledge and approval of the contents of the will separate from that of capacity: see Fisher v Kay [2010] WASCA 160 [85] (Owen JA, Buss & Murphy JJA); and Nock v Austin [1918] HCA 73; (1918) 25 CLR 519, 528 (Isaacs J). If a party seeking to impugn a will establishes any circumstances exciting suspicion that the provisions of the will may not have been fully known to and approved by the testator, then the party seeking to uphold the will has the burden of removing the suspicion by proving affirmatively by clear and satisfactory proof that the testator knew of and approved the will: Nock (528); and see Nicholson v Knaggs [2009] VSC 64 [155] (Vickery J).

160 It is not evident from Collins that this aspect of the law of wills, as well as the aspect of capacity, applies to voluntary dispositions. The issue appears to me not to have arisen in that case. No argument was directed to me on the matter.

161 However, I note the following quotation with approval from Crago v McIntyre [1976] 1 NSWLR 729, 740 741 in Collins [61] (emphasis added):

In establishing that test [of capacity] the courts have endeavoured to reconcile acceptance of the right of a testator to dispose of his property as he pleases with a desire to protect the interests of those whom society has accepted as having a moral claim on a testator's bounty. For this reason it is not enough for the testator to know and understand how he is leaving his property when he executes his will. He must also possess sufficient capacity to appreciate what his property is and recognise the persons who have a moral claim upon him and, more importantly for present purposes, a capacity to exercise a balanced judgment as to such claims. In my opinion, there is much to be said for applying the same standard to a voluntary settlement by a settlor of his own property. The positions of a settlor and a testator are not, of course, identical. In the case of a testator the law has no concern to look after the donor's own interests because he is dead, but equity has always shown some concern for the interests of a person who makes a voluntary settlement of his own property inter vivos. Maybe this is because the trusts created by such a settlement are enforceable only in equity, and this has given the equity courts, as courts of good conscience, an opportunity to apply to such settlements general concepts of fairness and protection of the weak, particularly when they are for some reason disabled from exercising a proper judgment of their own interests. No question of depriving another party of the benefits of a fair and proper bargain for which he has given consideration arises on a voluntary settlement, but such a settlement may put a settlor in a position in which he has failed to do justice, not only to himself, but also to those who may become dependent upon him, or to whom he might owe or acquire a moral duty to provide. For these reasons I think that there should be applied to the case of a voluntary settlement the same test of mental capacity as is applied to the creation of a testamentary trust.

162 In my view that quotation might be taken to indicate that the law as to knowledge and approval of the contents of a will applies to voluntary dispositions. In my view that would accord with the treatment of the law of capacity to make voluntary dispositions in Collins. However, I do not consider I have to arrive at a final view of this matter, for reasons which will become apparent in the following section of my reasons. It is in that section that I deal with the matter of Ronald's knowledge and approval of the claimed gift to the children of Ronald's interest in the Property.

163 I turn now to apply the principles I have described.

The issue of capacity: application of the principles

164 I have previously indicated that I find Ronald intended to make a gift to the children of his interest in the Property, at the date of the Transfer Form of 7 May 2007 and that intention continued thereafter. I have also indicated why I so found.

165 I also note that the Transfer Form of 7 May 2007 was explained to Ronald in the conversation he had on 7 May 2007 with the solicitors from Birman & Ride.

166 I also find that Ronald was by the Transfer Form of 7 May 2007 purporting to dispose of what was (if he survived Iris) his most substantial asset. I note in this regard the unchallenged evidence of Iris that before she and Ronald were married she became aware he was not a man of significant financial substance, while she understood the implementation of Ronald's idea for what became the Transfer to Iris was to give her 'some security' into her older age if Ronald were to pre-decease her. This would in my view engage principle (6) above.

167 I further accept that the evidence as to Ronald's age and his physical condition which led to his admission to the Hollywood Palliative Care Unit and 44 days later to his death raises a suspicion or doubt as to his capacity, and engages principle (8) above. However, as that principle indicates, those matters are not determinative of lack of capacity: see also Hardingham, et al, [306] nn94 97 and authorities referred to in those notes.

168 In my view the second defendant has not discharged its burden to show lack of capacity. Indeed I consider on the evidence I should find that Ronald did not lack capacity.

169 I note in this regard in particular the evidence of his conversations with the solicitors from Birman & Ride on 6 and 7 May 2007, and the evidence both of Mr Lenhoff and of Simon, which I accept, as to his mental capacities at about 7 May 2007 while he was in the Hollywood Palliative Care Unit. I reach that evidence in more detail shortly. In respect of Simon, I note, of course, his status as a witness with an interest. However, I consider on his evidence as a whole, and how he presented, that he is a credible witness.

170 I also note that there was no medical evidence as to Ronald's mental condition during his stay in the Hollywood Palliative Care Unit.

171 The body of evidence I have referred to in my view establishes that Ronald had testamentary capacity on 7 May 2007 within principle (5) and thus capacity on that date to make the voluntary disposition in question in this case.

172 True it is that there is also evidence, from Simon, that when he spoke with Ronald on the telephone on 27 April 2007 he concluded Ronald did not understand the difference between joint tenancy and tenancy in common. However, I have noted that in the conversation with the solicitors from Birman & Ride on 7 May 2007 Ronald gave broadly correct answers, in his own words, to the questions he was asked as to what would happen if he signed the Transfer Form of 7 May 2007. Those answers in my view showed Ronald had attained an understanding of the sort Simon had concluded Ronald did not have earlier.

173 Those answers also showed in my view knowledge and approval of the Transfer Form of 7 May 2007, and in my view there is no countervailing evidence.

174 For the second defendant it was put to me that evidence as to Ronald's apparent capacity should not be accepted at face value, in view of what was called the 'Noddy syndrome', to which it was submitted on the evidence Ronald was subject at all material times. It was put to me that this syndrome accounted for the broadly correct answers I have described.

175 The 'Noddy syndrome' is considered in Nicholson to which counsel for the second defendant referred me. In Nicholson the Noddy syndrome was the subject of expert evidence which was considered as follows ([382] [387]):

Dr Lloyd drew attention to the syndrome of 'gratuitous concurrence' in elderly patients, which he described as the 'Noddy syndrome'. This may arise where an elderly person will agree with questions put to him or her in order to placate, comply with, or ingratiate themselves with a person in authority, in this case the lawyer conducting the interview. It may also occur when the elderly person seeks out of embarrassment to mask their incapacity to understand what to the lawyer appears to be a simple concept, or simply to avoid causing what is perceived by the testator to be a problem.

An analogy may be drawn with the widely recognised tendency for some Indigenous Aboriginal witnesses to adopt this approach. In R v Anunga [(1976) 11 ALR 412 at 414] Foster J explained the propensity in the following terms:

[M]ost Aboriginal people are basically courteous and polite and will answer questions by white people in the way in which they think the questioner wants. Even if they are not courteous and polite there is the same reaction when they are dealing with an authority figure such as a policeman.

In answer to a question as to whether it is possible for an elderly person to mask the appearance of the onset of dementia, Dr Lloyd said:

It is possible to mask or deny many elements over a period of time. And one can interview patients and have a number of yes responses which if one assesses in any greater depth can actually be found not to be based on any understanding. The patients may easily be led and give the impression of knowing what they're doing and behav[e] appropriately.

[T]he important thing is each particular gift or the person to whom it is being given would be known and identified rather than the - Ms Dyke for example sitting back and simply demonstrating what I've called elsewhere the Noddy syndrome, that [with] some patients we can read out a series of questions or points and ... you have no idea whether or not there is an actual understanding. And sometimes that can only be clarified by putting it back on to the patient so to speak and saying what do you intend and why for this person, who is this person ... it avoids a patient being overloaded, overwhelmed, by a mass of material and simply taking the way out that I alluded to elsewhere that sometimes [a patient] will mask [his or her] ignorance by simply agreeing.

Professor Peisah expressed a similar view. She cautioned that:

An affirmative answer to the question: Do you understand what this will contains? is not an adequate reflection of understanding. The client should be asked to explain the effect of what he or she is doing in his or her own words and it is important to record the responses verbatim. [Peisah, C., 'Giving Expert Opinion in Matters of Testamentary Capacity: Nine Commonly Asked Questions', Continuing Legal Education Seminar NSW, June 2005, 1 at 78 (Ex P 17).]

I accept these observations of Dr Lloyd and those of Professor Peisah.

Protection against the effects of this problem described by both Dr Lloyd and Professor Peisah finds expression in the law. I refer in this respect to the observations of Tadgell JA in Robertson v Smith [[1998] 4 VR 165, 174], which have been cited earlier, to the effect that, in order to establish knowledge and approval of a will by a testator, more is required than 'merely establishing that the testator executed it in the presence of a witness after it had been read to or by him.'

176 The Noddy syndrome in that case was also described as a matter potentially relevant to knowledge and approval of an instrument: see Nicholson [679] [684].

177 It seems to me that the questions in Ronald's conversation with the solicitors from Birman & Ride on 7 May 2007 which produced Ronald's broadly correct answers on which I have relied were protection against the effects of the Noddy syndrome (see Nicholson [385]), if that were present in this case. There did not appear to be any similar evidence in Nicholson: see [679] [684].

178 In any event, it was not made out to me on the evidence of Ronald's conversations with the solicitors from Birman & Ride on both 6 and 7 May 2007 that Ronald was exhibiting the Noddy syndrome. He appeared there to articulate his own view in his own words of the interests of Iris and of himself in the Property, both without a transfer of his interest to the children and with such a transfer, and to state his own preferences in those respects, including, on 6 May 2007, to delay acting for a time. I note in particular the exchange on 6 May 2007 I described above that ran from Ronald's reference to putting the Property into Iris's name, saying it was '[m]y idea', to his response, after being told that if he transferred his interest in the Property to others one or other of the holders of interests in the Property 'could force the sale of the house', but that the proceeds would be split '50/50', and then being asked whether that was what he wanted, saying '[y]ep' and adding 'by the same token I would like to be able to wait until tomorrow morning'. I accept that there are elements of concurrence in the exchange, such as the first part of the last answer indicated. However, those elements of concurrence, when read with the rest of the exchange, such as the second part of the last answer, are not sufficient to indicate the presence of the Noddy syndrome.

179 Further, I consider that in the conversation on 6 May 2007 Ronald explained the change in position represented by a transfer of his interest in the Property to the children. He did this, it seems to me, in his response, when it was put to him in relation to the position without that transfer '[s]he would get the entire house?', in terms that he did not 'realise the complications', explaining that meant '[t]hat the children could take her to court etcetera etcetera and that I had made sure that I left the kids something hoping it wouldn't come to a court case'. I would infer that the complications to which Ronald referred were the concern as to the joint tenancy of the Property which Simon indicated to Ronald in their telephone conversation of 27 April 2007 in asking Ronald to rectify the situation, and which Ronald raised with Simon in their telephone conversation of 6 May 2007 in which Simon said he did not want to become involved but he would arrange for a lawyer to see Ronald.

180 Finally, I note that I do not have any evidence of incapacity in Ronald, including increasing confusion and progressive dementia, which any Noddy syndrome might be seen to mask, of the kind that Vickery J had before him in Nicholson: see [466] [476].

181 True it is there is some evidence of confusion, in Iris's and Mr Cohen's evidence as to Ronald's involvement in the changing of the locks to the Property on or about 23 April 2007 which would indicate Ronald must have been confused when he had the former keys used on his visit to the Property on 8 May 2007. However, this evidence appears not to be relied upon in this connection. In any event, I do not consider Ronald was involved in the changing of the locks, for the following reasons.

182 On Iris's evidence, and that of Mr Cohen as it finally emerged, as has been seen, the change was made after a conversation between Ronald and Mr Cohen by telephone about 23 April 2007 asking Mr Cohen to change the locks. On their evidence Ronald had indicated he wanted the locks changed because Josephine was 'dangerous'.

183 However, a finding that Ronald had forgotten this involvement on 8 May 2007 when he went with Josephine and Graham to the Property and was unable to enter it is difficult to square with the indications of Ronald's mental condition at the time I now describe. Those indications are from the transcripts of the conversations he had with solicitors from Birman & Ride, and they would appear to me to be of an ability to recall matters of importance to him. This is confirmed by the evidence from Mr Lenhoff as to Ronald's capacity at the time, 8 May 2007, that he gave instructions for what became the Will of 9 May 2007, that Mr Lenhoff had no concerns as to Ronald's capacity to give such instructions, and that Ronald was 'perfectly lucid and I was able to understand him and he was able to understand me' (ts 478). It is also confirmed by the evidence of Simon as to Ronald's capacity at 7 May 2007 that Ronald 'had all his faculties about him' (ts 476).

184 It is also not easy to understand why at about 23 April 2007 Ronald had a concern that Josephine was 'dangerous' that prompted him then to have the locks changed. On the unchallenged evidence of Josephine, at the time of Ronald's final admission to the Hollywood Palliative Care Unit she was visiting Ronald daily. On the evidence before me the only change in their relationship was her commencement, on 30 April 2007, after Iris's and Mr Cohen's indicated date of the changing of the locks, of proceedings against Ronald in the Magistrates Court to recover $10,000.

185 I consider it more likely than not that in fact it was Iris's decision to change the locks to the Property, and it followed her learning of the possibility of being asked to transfer her interest in the Property to Ronald. On the evidence before me she might have learnt of that possibility from the telephone conversation between Simon and Ronald on about 27 April 2007 to which she was privy, Simon's evidence as to which included that Simon asked Ronald to rectify the situation of the interests in the Property by having Iris transfer her interest back to Ronald, saying that if Iris did this Ronald would have full control of the land and be able to deal with it as he wished, and if Iris did this Simon would admit he was wrong about his attitude towards Iris. Indeed, on one reading of her affidavit evidence, which she appeared to confirm in her crossexamination, the changing of the locks addressed her concern for her 'future' that arose in part at least out of her learning of such a possibility.

186 I further note that I do not do not have medical evidence as to the Noddy syndrome itself of the kind to which Vickery J referred in Nicholson. Nor is it apparent to me that I am in a position to take judicial notice of the syndrome described, as I am not satisfied the syndrome is notorious in the sense required for judicial notice to be taken of it: see Cross on Evidence (8th Aust ed, 2010) [3015]. Nor is it apparent that the syndrome is part of the teachings of the ordinary experience of life: see Cross on Evidence [3200] [3285] on such teachings being employed in decision making in the courts.

187 I conclude then that it was not shown on the balance of probabilities that Ronald lacked the capacity to make a gift of his interest in the Property on 7 May 2007. Further, it has been shown that on the balance of probabilities he had knowledge of and approved the making of a gift in accordance with the terms of that instrument.

188 I consider there is no evidence from which I should conclude that the position in either respect was different on the date of Ronald's signatures to the Applications and the Statutory Declaration (16 May 2007) and date of his death (27 May 2007). There is no evidence as to Ronald's mental state on the earlier date, except that of Mr Lenhoff, including what might be inferred from the evidence of Mr Lenhoff as to Ronald's modification of par 8 in the Statutory Declaration. I have previously noted Mr Lenhoff's evidence as to Ronald's modification of par 8 of the Statutory Declaration. As to other evidence of Mr Lenhoff relating to Ronald's mental state including at the time of that modification, I note the following from his crossexamination (ts 484):

At that stage how was Mr Stone? You don't have any file note?---No, but in all my dealings with him he was lucid, coherent, he knew what he wanted. In one of the meetings he even amended a document

189 I also note Mr Lenhoff's evidence in his affidavit that '[o]n all of the occasions that I met with Mr Stone, he appeared to be alert and to understand my questions and he gave coherent answers'.

190 In respect of Mr Lenhoff's meeting with Ronald on 13 May 2007 in which Ronald confirmed his continuing intention to transfer his interest in the Property to the children, Mr Lenhoff gave the following evidence in crossexamination (ts 485 487):

Would you say he was fading at that stage?---Well, he became progressively more frail as the month went past, yes.

This is one of the first?---He certainly wasn't in the condition, the physical condition, when I first saw him on the 8th.

The 8th, yes, and not even on the 9th when he signed the will, but what you're saying is that here is an indication to you by the 13th he's fading. Is that right? He's nodding off?---I don't know what you mean by 'fading'. He was certainly

He didn't answer you. He just answered by nodding his head?---Yes, but he was able to talk because when I asked him another question, he answered that.

Okay?---He was fine, Dr Hockley. There was nothing wrong with him mentally.

191 All of that evidence so far as it goes would indicate Ronald did not lack capacity and knew and approved of the gift.

192 Finally, I note there is no evidence as to Ronald's mental state at the date of death, 14 days later, including as to any change in his mental state.

193 I conclude then that the case for the second defendant as to lack of capacity at any material time has not been made out, and I should find that at all material times Ronald knew of and approved the gift in accordance with the terms of the Transfer Form of 7 May 2007.

194 On the findings on which this conclusion rests, I also conclude that Ronald did not lack the capacity to make the Will of 9 May 2007.

195 As to the matter of knowledge and approval of the Will of 9 May 2007, I accept without finding that there were circumstances exciting suspicion that the provisions of that instrument may not have been fully known to and approved by Ronald in his physical condition at the time. I note the evidence of Mr Lenhoff that, at the meeting of 9 May 2007 at which Ronald executed the Will of 9 May 2007, he told Ronald he had prepared a will on Ronald's instructions leaving everything to the plaintiffs equally and appointing Simon as executor. On that evidence, I consider that the burden of proof on this issue has been discharged. While Mr Lenhoff's evidence is not that the Will of 9 May 2007 was read to or by Ronald, there is no suggestion that Mr Lenhoff had not accurately explained its terms to Ronald. Such an explanation may discharge the burden of proof: see Hardingham et al, [304] at n52.

The issue of undue influence: applicable principles

196 There was some apparent contest as to the applicable principles in relation to undue influence, as I will note. I set out below what I consider to be the law.

197 The fundamental principles of the law of undue influence are in my view sufficiently set out in Permanent Mortgages Pty Ltd v Vandenbergh [2010] WASC 10 [166] [176] (Murphy J), as follows:

The basis of the equitable jurisdiction to set aside an alienation of property on the grounds of undue influence is the prevention of the unconscientious use of any special capacity in or opportunity for the disponee to affect the disponor's will or freedom of judgment in reference to the transaction: Johnson v Buttress [1936] HCA 41; (1936) 56 CLR 113, 134.

The jurisdiction to set aside a transaction procured by undue influence is exercised on two bases. The first is where undue influence is proved as a fact. The second is where undue influence is presumed by reason of the antecedent relationship between the parties, and the presumption has not been rebutted: Johnson v Buttress (119); Union Fidelity Trustee Co of Australia Ltd v Gibson [1971] VicRp 69; [1971] VR 573, 575. The former is 'actual' undue influence and the latter is 'presumed' undue influence: Powell v Powell [2002] WASC 105 [120] - [121].

Actual undue influence requires proof that the transaction was the outcome of such an actual influence over the mind of the disponor that it cannot be considered to be the free act of the disponor: Johnson v Buttress (134). The source of power to practise such influence or domination over the disponor may not arise from an antecedent relationship, but may arise in the particular situation, or by the deliberate contrivance of the disponee: Johnson v Buttress (134).

Presumed undue influence arises in two ways. One is where there exists a class of relationship historically recognised by the law as raising a presumption of undue influence. The recognised classes include parent and child, guardian and ward, solicitor and client, doctor and patient, religious adviser and adherent, and trustee and beneficiary: Johnson v Buttress (119, 134) (cf Meagher RP, Heydon JD & Leeming MJ, Meagher, Gummow & Lehane's Equity: Doctrines & Remedies (4th ed, 2002) [15-095] as to the last mentioned class).

Dispositions from the latter to the former fall within the presumption.

The other is where, outside of those recognised categories, the plaintiff positively proves that there in fact existed an antecedent relationship between the parties, the nature of which was that the defendant was in a position to exercise dominion, power, or ascendency over the plaintiff: Meagher, Heydon & Leeming, Equity: Doctrines & Remedies [15-105].

The recognised categories of relationship are marked by the characteristic that it is not natural to expect that 'one party would give property to the other. That is to say, the character of the relation itself is never enough to explain the transaction and to account for it without suspicion of confidence abused': Yerkey v Jones [1939] HCA 3; (1939) 63 CLR 649, 675.

Parents' dispositions to children can be explicable as being the consequence of parental love and affection without any suspicion of confidence abused. Accordingly, the parent/child relationship, insofar as it concerns dispositions from parent to child, is not a presumed relationship of influence. See Powell v Powell [130]; Wilby v St George Bank [2001] SASC 388; (2001) 80 SASR 404 [95]; Urane v Whipper [2001] NSWSC 796 [22]; Tessmann v Costello [1987] 1 Qd R 283, 293; ASB Bank Ltd v Harlick [1996] 1 NZLR 655, 660 - 662.

Indeed, in the converse situation, for the purposes of the principle with respect to dispositions by the child in favour of the parent, undue influence is presumed, even though the child be an adult, unless the parent establishes that the child had at the time of the transaction been emancipated from the influence: Powell v Powell [131]; Meagher, Heydon & Leeming, Equity: Doctrines & Remedies [15-075].

Where a special relationship outside of the traditional categories is set up it is 'necessary to see the extent and nature of the confidence reposed and whether it involved any ascendancy over the will of the person supposedly dependent on the confidence': Jenyns v Public Curator (Qld) [1953] HCA 2; (1953) 90 CLR 113, 133.

The doctrine of undue influence looks to the quality of the consent, or assent, of the weaker party: Commercial Bank of Australia v Amadio (474); Bridgewater v Leahy [1998] HCA 66; (1998) 194 CLR 457, 478.

198 See also Whereat v Duff [1972] 2 NSWLR 147, 167 170 (Asprey JA, Holmes JA agreeing); and Nattrass v Nattrass [1999] WASC 77 [98] [105] (Commissioner Buss QC) (cases of gift). See also Nicholson [101] [150] (a testamentary disposition case) comparing and contrasting principles of testamentary undue influence.

199 Counsel for the second defendant laid heavy emphasis on Nicholson. However, it is clear to me that it is the law of undue influence in inter vivos transactions that is my main concern. Thus, to that extent I am not concerned with the issue from the law of testamentary undue influence of whether or not in a case involving circumstantial evidence the standard of proof is more akin to the criminal standard than to the civil standard: see the discussion of this issue in Nicholson [110] [138]. At the same time, I consider I can draw on principles from the law of testamentary undue influence to the extent they are capable of being of assistance.

200 In particular, consistent with the principle in Permanent Mortgages [176], that the doctrine of undue influence looks to the quality of the consent, or assent, of the weaker party, is in my view the following from Nicholson [150]:

The key concept is that of 'influence'. The influence moves from being benign and becomes undue at the point where it can no longer be said that in making the testamentary instrument the exercise represents the free, independent and voluntary will of the testator. It is the effect rather than the means which is the focus of the principle. The effect can be achieved in the context of a variety of circumstances and relationships. It can be the product of a chain of events, or a single event. It may be achieved by the conduct of one person or several, whether acting in concert or quite independently. Further, the influence need not be intentionally exercised by any particular person or persons for the purpose of overbearing the free and independent will of the testator. Mens rea has no place as an element calling for proof, although more often than not an intention to bring about a desired result which is contrary to the true will of a testator will be present in cases where conduct amounting to undue influence is found.

201 I take from this last paragraph that the influence for the purposes of a case on either of the bases in Permanent Mortgages [167], of actual undue influence or of presumptive undue influence, might be shown by proof by the party seeking to impugn the voluntary disposition that there was an ascendancy on the part of the donee, arising from a range of sources.

202 However, whether the influence was undue depends on a showing by the party seeking to impugn the transaction either that the transaction was the outcome of the exercise of that influence (actual undue influence) or that the relationship is one such that it should be presumed that the transaction in question was one resulting from such exercise (presumed undue influence).

203 In this case, the second defendant, as I understood the submissions for her, relied upon both bases from Permanent Mortgages [167].

204 I turn now to the application of these principles.

The issue of undue influence: application of the principles

205 As I understood the submissions for the second defendant, it was contended that there were circumstances which showed that the relationship between Ronald and his children was not an ordinary one of parent and children, but a relationship which gave them, or at least Simon or Josephine or the two of them together, influence in the sense of an ascendancy over Ronald. I further understood the submission to be that this ascendancy was one that the evidence showed had actually been exercised resulting in the gift to the children of Ronald's interest in the Property or at least was one such that the gift should be presumed to be the result of that ascendancy.

206 It was common ground that at least the ordinary relationship of parent and child does not give rise to any presumption of influence in respect of a gift, even a substantial gift, from parent to child. See Powell v Powell [2002] WASC 105 [130] (McLure J), referred to in Permanent Mortgages [173].

207 I accept that, on the other authorities cited in Permanent Mortgages [173] (see Wilby v St George Bank [2001] SASC 388; (2001) 80 SASR 404 [95] (Perry J, Doyle CJ and Bleby J agreeing); Urane v Whipper [2001] NSWSC 796 [22] (Windeyer J); Tessmann v Costello [1987] 1 Qd R 283, 293 (Williams J); ASB Bank Ltd v Harlick [1996] 1 NZLR 655, 660 662 (Gault, Henry and McGechan JJ)), that, while an ordinary parent/child relationship would not be presumed to give the child an ascendancy over the parent, particular circumstances may show such an ascendancy.

208 In this case as I understood the submissions for the second defendant, the circumstances relied upon to show an ascendancy of one or more of the children over Ronald were Ronald's age and his physical condition at least from 6 May 2007 and the visits of solicitors for at least Josephine (Birman & Ride) to Ronald on 6 and 7 May 2007 while he was in that condition, occurring against the background of the element of a claim of sexual molestation by Josephine against Ronald to which I accept Ronald was sensitive and Josephine's Magistrates Court Proceedings; Simon's request in the telephone conversation of 27 April 2007 that Ronald rectify the situation of Iris being a joint tenant of the Property; an attempt by the children to have a lawyer accompany Ronald and Iris on the visit to the Property on 11 May 2007; and the evidence of Graham's attempt on 6 May 2007 to have Iris sign the Handwritten Note.

209 I put aside the last two matters, the second last of which I return to under duress below. I do not consider that they go to show an ascendancy of any of the children over Ronald.

210 I consider the remaining matters relied upon by the second defendant are not sufficient taken together to show an ascendancy of any one or more of the children over Ronald for either of the purposes the second defendant contended for at any relevant time. I so consider in view of my findings as to Ronald's capacity notwithstanding his physical condition to which I have previously referred, coupled with the following: his dealings with the solicitors from Birman & Ride on 6 and 7 May 2007 which I have previously described in relation to his capacity, dealings which occurred after the compiling of the Handwritten Note which described a sharing of the Property between the children and Iris; my findings which I describe in the section of these reasons on duress as to the telephone conversations in which on Iris's evidence the matter of the claim of sexual molestation was deployed; the lack of any evidence as to the effect of Josephine's Magistrates Court proceedings on Ronald; and his apparent movement from seeking a transfer of Iris's interest in the Property to himself, which Simon had sought of him, to settling on a transfer of his interest to the children, in the context of the provision for both Iris and the children that that latter transfer represented. In that last respect, I note in particular, apart from the contents of the Handwritten Note, the evidence of Mr Fletcher that Ronald had said to him in a conversation in early May 2007 he was not going to agree to leave the Property to his three children as he wanted to make provision for Iris. This was against the background of having made contingent provision for the children in the Will of 30 March 2007, a change from his two previous wills, which made no such provision.

211 I accept that each of his seeking a transfer of Iris's interest in the Property to himself and his subsequent settlement on a transfer of his interest in the Property to the children was put to him by, respectively, Simon (in the conversation of 27 April 2007) and Birman & Ride (most clearly, in the conversation of 7 May 2007). However, I consider that, when account is taken of the entirety of the conversations of 6 and 7 May 2007, with the background of the Handwritten Note, the Will of 30 March 2007 and the conversation with Mr Fletcher, Ronald's behaviour in seeking that transfer and then so settling does not indicate an ascendancy of the children or any of them over him.

212 It is clear law that an ascendancy does not require domination of the donor: see ASB Bank Ltd (658), quoting from Goldsworthy v Brickell [1987] Ch 378 (CA), 401 (Nourse LJ). Further, the fact the idea for the gift appears to emanate from the donor himself or herself does not preclude a finding that there was an ascendancy which actually or presumptively produced that idea: see Whereat (168 169); and Nattrass [104].

213 However, I consider that my findings just referred to, in the context described, indicate strongly that Ronald was capable of arriving at and had arrived at his own determination of how to provide for his family, being his wife and his children, which might be expected in the context of competing claims to his bounty they might represent for him, and strongly point away from the ascendancy the second defendant contended for.

214 It follows in my view that the second defendant has failed to make her case in relation to undue influence.

215 It would also follow that any claim of testamentary undue influence in respect of the Will of 9 May 2007 would likewise fail.

216 I turn now to the second defendant's case for duress.

217 There appears to be no contest as to these principles, as to be drawn from Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40, 45 - 46 (McHugh JA), and Barton v Armstrong [1976] AC 104, 120 (Lord Cross). I take from those authorities the following principles potentially relevant to this case:

1. Duress is the exertion of pressure, in the form of illegitimate pressure being unlawful threats or unconscionable conduct, which induced the victim to enter into the impugned transaction: Crescendo (45 46);
2. Where the party seeking to impugn the transaction makes out duress, the transaction is voidable: Crescendo (45); and
3. Where the evidence establishes that the pressure exerted on the victim was illegitimate, the onus lies on the person applying the pressure to show that it made no contribution to the victim entering into the transaction: Crescendo (46) referring to Barton (120).

218 I turn now to the application of these principles.

The issue of duress: application of the principles

219 As I understood the submissions for the second defendant, the pressure exerted in this case was that indicated in Iris's evidence as to the matters involving Ronald and Josephine in the four telephone conversations which she testified she had heard, as well as the matters indicated in the transcript of the conversations between Ronald and solicitors from Birman & Ride on 6 and 7 May 2007. As I do not consider that it is apparent on the transcript of those conversations there are indications of any pressure exerted on Ronald of an illegitimate kind, I took those submissions to be ones calling for me to weigh that appearance with what was put from Iris's evidence as to the threats in the telephone conversations emanating from or associated with Josephine, for whom Birman & Ride acted at all material times.

220 I do not consider that the exertion of illegitimate pressure has been made out on my findings as to those telephone conversations.

221 The four telephone conversations were the telephone conversations of about 27 April 2007, between Ronald and Simon; of about 28 April 2007 between Ronald and Josephine; of about 10 May 2007 between Ronald and Mr M; and of about 11 May 2007 between Ronald and Mrs Tudori.

222 The telephone conversation of about 27 April 2007 was as I have indicated on Iris's evidence about a 'rape allegation', and in that conversation Simon had said 'you have to prove it in court that you didn't do it'. I note Iris's testimony in crossexamination that it was possible Simon did not use the word 'rape', although that was what she understood the conversation to relate to; while as I have indicated Simon denied he had discussed with Ronald a rape allegation by Josephine. In any event, it seems to me to be implausible that Simon, who was at that time a consultant state prosecutor at the DPP, would have said to Ronald, as Iris's evidence was that he said, 'you have to prove it in court that you didn't do it'.

223 I consider then that I should prefer Simon's evidence as to what was said in that conversation as well as his evidence, previously referred to, that he had never discussed with Ronald a 'rape allegation' by Josephine, had never said to Ronald 'you have to prove it in court that you didn't do it' or words to that effect and had never given Ronald advice about the matter concerning Josephine. The former evidence, as I have also indicated, was that Ronald told Simon he and Iris were going to have a Jewish wedding ceremony and he had transferred a half interest in the Property to Iris; there was a discussion of who might come to the ceremony, in the course of which Simon asked Ronald whether or not Iris knew about the 'the business with Jo'; Simon tried unsuccessfully to explain to Ronald survivorship under joint tenancies; and Simon asked Ronald to rectify the situation by having Iris transfer her interest in the Property back to Ronald, saying that if Iris did this Ronald would have full control of the land and be able to deal with it as he wished, and if Iris did this Simon would admit he was wrong about his attitude towards Iris.

224 While I consider that the use of an allegation of rape, or of sexual molestation might be capable of being the exertion of illegitimate pressure, I do not consider that the pressure Simon's request of Ronald might have exerted was illegitimate pressure.

225 The telephone conversation of about 28 April 2007 was, as I have indicated, on Iris's evidence one in which Josephine said to Ronald words to the effect that if he did not 'do it my way' she was going to tell the Jewish community that 'you raped me', she had 'pictures and other proof' and she had 'complained' to 'Rabbi Frielich and others'. Josephine denied that in that conversation she used any words to those effects. Her evidence was the conversation concerned Ronald's repeated request for forgiveness, which Iris denied.

226 It was put to me that Iris's evidence as to what Josephine said in the conversation should be disbelieved as there was no suggestion at this time of a transfer of any interest in the Property. I consider that submission cannot be sustained in view of Simon's evidence as to what he asked of Ronald in the telephone conversation of about 27 April 2007.

227 However, on the evidence of Josephine she never had an 'open and frank' discussion with Ronald about the matter of her complaint of sexual misconduct towards her by him, and that complaint was one of molestation in a sexual way, which she had never referred to as 'rape'. The subject matter of that complaint was one which she had 'blocked ... out totally'. On my assessment of her as a witness, as well as the entirety of her evidence, I consider that I should believe her evidence in these respects. I find support for that view from the implausibility of her having said, as Iris's evidence says Josephine said, that she had 'pictures and other proof'.

228 I consider then that I should prefer Josephine's evidence that in that conversation she did not use words to the effect attributed to her in Iris's evidence, and that the conversation concerned what Josephine's evidence said it did concern, Ronald's repeated request for forgiveness. Any pressure Ronald may have felt indicated by that request has not been shown to have emanated from Josephine, or, if that pressure had so emanated, to be illegitimate pressure.

229 The telephone conversation of about 10 May 2007 between Ronald and Mr M, was, as I have indicated, on Iris's evidence one in which Ronald wished to discuss with Josephine the roster for visits to him at the Hollywood Palliative Care Unit. The effect of that evidence is that the roster was never discussed, as Mr M answered Josephine's telephone and, after asking if Ronald had signed the form of Transfer from Iris to Ronald, and after Ronald had said he had to defend and protect his wife, Mr M had said 'You are a weak piece of shit, we are going to say to the Jewish community that you have raped her', and '[h]e said', '[f]uck you and the Jewish community'. Ronald never said 'I suppose you think that I am a weak piece of shit' and Josephine never participated in the conversation.

230 Josephine's evidence did not include that Mr M asked whether Ronald had signed the form of Transfer from Iris to Ronald, did attribute to Ronald words similar to those just quoted and did attribute to Mr M the reply to them 'Yes you are; you are a weak piece of shit', at which point Josephine took the telephone, and a conversation about the roster ensued, in which at one point Ronald said 'I have to defend and protect my wife. I cannot let you upset her.'

231 I consider that Josephine's account of the conversation is to be preferred. It seems to me to be implausible that Mr M would have asked about the form of Transfer from Iris to Ronald at a time, 10 May 2007, when Josephine's solicitors had obtained from Ronald a Transfer Form of 7 May 2007; while the words that on Iris's evidence were used after Mr M said 'we are going to say to the Jewish community that you have raped her', being '[f]uck you and the Jewish community', make no sense attributed to Mr M and are not easily attributed to Ronald. It also seems to me more likely than not that Ronald and Josephine would have discussed the roster in the conversation, given the conversation's purpose.

232 Finally, there is Iris's evidence that in the morning of 11 May 2007, before Iris and Ronald visited the Property to look for its duplicate certificate of title, she had been with Ronald in the Hollywood Palliative Care Unit when first she and then Ronald had spoken with Mrs Tudori about a lawyer accompanying them on a visit to the property and Mrs Tudori had said such accompaniment would be 'harassment' and Ronald should refuse his company. In Mrs Tudori's evidence she describes what it appears to be common ground was that conversation but does not refer to this matter, and there was no attempt to crossexamine her on the matter. Nor was there any attempt to cross-examine Mr Aldus or Mr Russell on the matter of whether a lawyer from Birman & Ride had sought to accompany Iris and Ronald on a visit to the Property, where none of their affidavit refers to the matter.

233 In any event I consider that I do not have to determine whether or not to prefer Iris's account, as it is not clear to me, as I have previously indicated in the section of these reasons on undue influence, how any such possible accompaniment as her evidence indicates would be capable of contributing to the influence of, and therefore pressure from, the children in relation to Ronald, at least where the person did not accompany Iris and Ronald on the visit.

234 Nor in my view does Iris's account indicate to me that, in the face of the transcript of the conversations on 6 and 7 May 2007, I should find that the solicitors from Birman & Ride on behalf of their clients on one or other or both of those earlier dates exerted illegitimate pressure on Ronald to secure a gift of his interest in the Property to the children.

235 It follows I find the second defendant's claim of duress not to be made out.

236 On my understanding of the second defendant's case as to duress, it is not clear to me how that case has any application to the Will of 9 May 2007. True it is that the solicitors Birman & Ride identified Holborn Lenhoff Massey as the solicitors Ronald should appoint for the purposes of that will. However, there is no evidence from the transcript of the conversations of 6 and 7 May 2007 that Birman & Ride also gave Mr Lenhoff instructions for that will or sought to direct Ronald as to those instructions, while the evidence of Mr Lenhoff is that he took such instructions from Ronald himself.

237 I turn now to the second defendant's claim of unconscionability.

The issue of unconscionability: applicable principles

238 There appears to be no contest as to these principles. I consider the fundamental principles are for my purposes set out in Permanent Mortgages [219] [231], as follows:

Equity's jurisdiction to set aside a transaction for unconscionable dealing is invoked where one party to the transaction is under a special disadvantage or disability in dealing with the other party, and that special disadvantage or disability was sufficiently evident to the other party to make it prima facie unfair or unconscionable for that other party to accept or retain the benefit of the transaction: Commercial Bank of Australia v Amadio; Louth v Diprose [1992] HCA 61; (1992) 175 CLR 621, 637.

The underlying equitable principle may be invoked 'whenever one party by reason of some condition or circumstance' is placed at a special disadvantage of which unfair and unconscientious advantage is taken by the other party: Commercial Bank of Australia v Amadio (462).

The special disadvantage will be sufficiently evident to the other party if the other party knows facts which would raise the possibility of the special disadvantage in the mind of a reasonable person: Commercial Bank of Australia v Amadio (467 - 468, 479).

Where such circumstances are shown to exist, the onus is on the other party to establish that the transaction was fair, just and reasonable: Commercial Bank of Australia v Amadio (474).

The special disadvantage need not have been created by the party taking the benefit of the transaction: Louth v Diprose (629).

The special disadvantage alleged must be one 'which seriously affects the ability of the innocent party to make a judgment as to his own best interests'; mere difference in bargaining power is insufficient: Commercial Bank of Australia v Amadio (462). The 'essence of such weakness is that the party is unable to judge for himself': Blomley v Ryan [1956] HCA 81; (1956) 99 CLR 362, 392; or 'to conserve his own interests': Blomley v Ryan (415); ACCC v C G Berbatis Holdings [Australian Competition and Consumer Commission v C G Berbatis Holdings Pty Ltd [2003] HCA 18; (2003) 214 CLR 51] [12], [46], [55].

In this regard care must be taken not to 'eviscerate unconscionability of its meaning': NZI Capital Corporation v Fulton [1998] FCA 667 Black CJ & Lehane J, quoting Mason CJ in Stern v McArthur [1988] HCA 51; (1988) 165 CLR 489, 503.

In ACCC v C G Berbatis Holdings, Gleeson CJ [14] said:

Unconscientious exploitation of another's inability, or diminished ability, to conserve his or her own interests is not to be confused with taking advantage of a superior bargaining position. There may be cases where both elements are involved, but, in such cases, it is the first, not the second, element that is of legal consequence ...

In ACCC v C G Berbatis Holdings, Gummow & Hayne JJ [56] also said that even a person in a 'greatly inferior bargaining position' may nevertheless not lack capacity to make a judgment about that person's own best interests.

In all cases, the court's equitable jurisdiction is to be exercised according to recognised principles, and the courts are not armed with a general power to set aside transactions which in the eyes of the judges appear unfair, harsh or unconscionable: Louth v Diprose (654) (Toohey J, although in dissent in the result). See also the observations of Sir Anthony Mason in 'The Impact of Equitable Doctrine on the Law of Contract', (1998) 27 Anglo-American Law Review 1, 12 cited by Debelle & Wicks JJ in Micarone v Perpetual Trustees Australia Ltd [1999] SASC 265; (1999) 75 SASR 1 [648]:

There is a strong objection to simply equating the concept to what is unreasonable and unfair. The object of the doctrine is not to protect people from the consequences of their own mistakes. Because our contract law, unlike that of the United States, does not impose a general obligation of good faith and fair dealing, it is preferable to think of unconscionable conduct in terms of that which shocks the conscience, something which is harsh or oppressive in that it involves taking advantage of another's special disability or disadvantage. So understood, the concept is not one which is open-ended, to be applied according to the subjective whim of the Judge, though like other standards, such as that of 'the reasonable person', borderline applications will require an element of value judgment.

In Bridgewater v Leahy [(1998) [1998] HCA 66; 194 CLR 457] [76], Gaudron, Gummow & Kirby JJ referred with approval to the Privy Council's observations in Hart v O'Connor [1985] UKPC 1; [1985] AC 1000, in which unconscionable conduct was described as:

[V]ictimisation, which can consist either of the active extortion of a benefit or the passive acceptance of a benefit in unconscionable circumstances.

In The Bell Group Ltd (in liq) v Westpac Banking Corporation [No 9] [2008] WASC 239; (2008) 225 FLR 1 [4924], Owen J said that it is not enough for there to be unequal bargaining power - the conduct of the stronger party has to be exploitative or oppressive.

Whilst the categories of disability are not closed, the requisite special disadvantage often involves poverty, need, sickness, age, infirmity of body or mind, sex, drunkenness, illiteracy, lack of education and lack of assistance or explanation when assistance or explanation is necessary: Blomley v Ryan (405, 415); lack of or limited comprehension of the English language: Commercial Bank of Australia v Amadio; impaired intelligence: Wilton v Farnworth [1948] HCA 20; (1948) 76 CLR 646; or infatuation with or emotional dependence upon another person: Louth v Diprose.

I turn now to the application of those principles.

The issue of unconscionability: application of the principles

239 As I understood the submissions for the second defendant, Ronald's special disadvantage or disability in dealing with his children lay in Ronald's age and the infirmity that led to his admission as a patient in the Hollywood Palliative Care Unit and from which 44 days after his admission he died.

240 Age and an infirmity of the body may be special disadvantage or disability: see Permanent Mortgages [231].

241 I accept that if that age and infirmity (physical condition) were special disadvantage or disability it was sufficiently evident to his children, if necessary through Birman & Ride at the meetings with Ronald on 6 and 7 May 2007, so as to make it prima facie unfair or unconscientious for them to procure or accept his assent to the claimed gift to the children of Ronald's interest in the Property or the Will of 9 May 2007.

242 However, I consider that that age and infirmity has not been shown to be a special disadvantage or infirmity in the sense required by the fundamental principle that it was one which seriously affected the ability of the innocent party to make a judgment as to his own best interests (Permanent Mortgages [224]).

243 I so consider on my findings which I considered meant the second defendant had not made out her claim of undue influence. On those findings I do not consider it has been shown that Ronald's age and physical condition at any relevant time seriously affected Ronald's ability to make a judgment as to his own best interests, in this case, a judgment adjusting the interests in the Property to provide both for his children and for Iris.

244 There was no other basis for a claim of unconscionable dealing put to me than Ronald's age and infirmity (physical condition). Thus, there was no claim of special disadvantage or infirmity resting on a strong emotional attachment to or dependence upon the children: compare Bridgewater v Leahy [1998] HCA 66; (1998) 194 CLR 457. To the extent there might have been a claim of a special disadvantage or disability deriving from the influence of any of the children on Ronald while he was in the Hollywood Palliative Care Unit, I consider that I have dealt with such a claim in relation to the claim of undue influence.

245 In my view it follows that the second defendant's claim of unconscionable dealing has not been made out.

246 In my view it would also follow that any claim of unconscionability in relation to the Will of 9 May 2007 would likewise fail.

247 I turn now to my conclusions and orders, including the matter of certain costs orders.

Conclusions and call for orders, including as to costs

248 I have concluded that, on the assumption the claimed gift to the children of Ronald's interest in the Property was one in respect of which equity should afford relief, on the basis either that it was a perfect gift in equity, or if it was not it was a gift to which effect should be given because of the rule in Strong v Bird, none of the second defendant's claims against such relief has been made out.

249 However, I have also concluded that that gift was an imperfect gift, to which the rule in Strong v Bird has no application. Thus, equity should not afford relief in respect of it, and thus the plaintiff's claims for declarations must fail.

250 I will hear from the parties as to the orders I should make on these conclusions.

251 However, there is one matter of orders in particular that I should further enter into in these reasons. It is that of the costs of the hearing on 23 April 2010, at which I determined that the issues to be addressed at the hearing of the originating summons should be restricted to the issue of perfect gift, reflecting an abandonment of the issues arising in respect of Transfer of Land Act s 203, as well as my determination not to include the other issues arising out of the second defendant's claims that any gift equity would otherwise recognise should not be enforced. As I have earlier explained, at the next hearing, on 19 May 2010, as a result of the correction of an error in an affidavit for the plaintiffs, I determined that the issues to be addressed on the hearing of the originating summons should also include those claims of the second defendant. For the second defendant, written submissions dated 18 May 2010 had been filed for the hearing of 19 May 2010 in which the second defendant put forward bases for her claim for the costs of the hearing on 23 April 2010 and costs thrown away, on an indemnity basis or otherwise, regardless of the event in these proceedings. However, there was no exchange of submissions by the parties with respect to that claim, and the only costs order I made at the hearing of 19 May 2010 was costs reserved. I consider that costs order to relate to the hearing of 19 May 2010 as well as that of 23 April 2010.

252 I consider on that history that the parties' submissions as to orders to be made might properly include submissions as to the costs orders to be made in respect of the hearings of 23 April 2010 and of 19 May 2010, and that for that purpose the second defendant might choose to rely at least in part on the written submissions of 18 May 2010.

CITATION : STONE -v- REGISTRAR OF TITLES [2012] WASC 21 (S)

HEARD : 23 APRIL, 19 MAY, 16, 17, 24 & 28 SEPTEMBER 2010 & ON THE PAPERS

Costs - Apportionment of costs where successful second defendant failed on most issues - Special costs orders - Approach where no supporting affidavit evidence - Costs of and for litigants in person also assisted by lawyer - Costs of the applications for costs where results mixed

Legal Practice Act 2003 (WA), s 215

Legal Profession Act 2008 (WA), s 280, s 601, s 616

Rules of the Supreme Court 1971 (WA), O 66 r 1, r 8A

Transfer of Land Act 1893 (WA), s 203

Second Defendant : Ms C F Greville (23 April 2010); Ms C F Greville & Mr J C Hammond (19 May 2010); Dr J J Hockley & Mr D Warren (16, 17, 24 & 28 September 2010)

Second Defendant : Hammond Worthington (24 April & 19 May 2010) and In person (all other dates)

1 This is my decision on competing applications for costs following my judgment in the action. My judgment was Stone v Registrar of Titles [2012] WASC 21. The competing applications were made by reference to competing minutes of orders with written submissions in support, and in one case only clearly by reference to the written submissions the party made. Those materials were filed and served under programming orders made on 25 January 2012 at the delivery of Stone: the times for such filing and service under those programming orders were extended by consent, twice.

2 This decision should be read with Stone. For the most part, in this decision I provide paragraph references for Stone but do not reproduce or summarise what appears in those paragraphs.

3 To introduce the positions of the parties in those competing applications, I first provide some background. Then I describe those positions, before taking each and providing my reasons for the conclusion or conclusions I have reached on that position. The final section of this decision is my conclusion and call for orders.

4 The following background is taken for the most part from Stone.

5 The action was commenced by the plaintiffs by originating summons filed on 5 July 2007 (the originating summons) claiming the orders described in Stone [7]. The claim, under Transfer of Land Act 1893 (WA) s 203, for orders against the first defendant was abandoned on 23 April 2010.

6 There was a hearing on 23 April 2010 which addressed the resolution of the issues in the action confined with the consent of the second defendant to the issue which the plaintiffs had contended was the sole issue in the case. That was the issue of whether or not there was a gift (the gift) the first steps towards which were made on 7 May 2007 and which was a perfected gift to the plaintiffs by the second defendant's husband, who by the date of the commencement of the action was deceased (the deceased), of the deceased's joint interest with the second defendant in the residential property (the residential property) at which the second defendant was living (the perfect gift issue). See Stone [98]. There were further hearings, on 19 May and 13 July 2010, as a result of which the issues for determination in the action also included those of whether the gift was vitiated by a lack of capacity of the deceased (the capacity issue), by undue influence (the undue influence issue), by duress (the duress issue) and by an unconscionable dealing (the unconscionability issue) (collectively, the further issues). See Stone [99] [100]. There were further hearings of the issues arising out of the originating summons on 16, 17, 24 and 28 September 2010 (the September hearings).

7 The relationship between the perfect gift issue and the further issues was not as straightforward as the account thus far might be taken to indicate. In Stone I concluded the issues were not simply ones put forward by the second defendant as vitiating an otherwise perfected gift. Those issues were advanced as going to an element of the alternative basis the plaintiffs put forward for their contention that the gift should be upheld as a perfected gift. That element concerned the appointment of one of the donees as executor in a will the deceased made on 9 May 2007 (the will of 9 May 2007). The further issues went to showing that the will of 9 May 2007 should not be recognised on one or more of the grounds subsumed by the further issues. See Stone [145], read with [129] [130] and [133].

8 I should further note, as the contrary appears to have been put to me for the plaintiff, that I do not consider the further issues should be regarded as a form of counterclaim. The further issues went directly to impeach the plaintiffs' claim. See on the nature of a counterclaim Kendall C and Curthoys J, Civil Procedure in Western Australia [18.2.1] (Service 128).

9 On 25 January 2012 I delivered the decision in Stone. I determined that the plaintiffs had not made their case that the gift was perfected on either of the two bases they advanced, although the element of the alternative basis to which the further issues related was in fact made out, contrary to the second defendant's case in that respect. I also determined, on the assumption I was in error as to the perfect gift issue, that the second defendant had not made out her case on any of the further issues.

10 Those positions appear from the parties' respective minutes and written submissions.

11 For the plaintiffs, there is a document 'Plaintiffs' minute of proposed orders on costs' dated 24 February 2012 and filed 27 February 2012 (the plaintiffs' minute). For the plaintiffs there are also two sets of written submissions. One is the document 'Submissions on costs' dated 24 February 2012 and filed 27 February 2012 (the plaintiffs' original submissions). The other set of written submissions is the document 'Reply to the second defendant's submissions on costs' dated and filed 20 March 2012 (the plaintiffs' reply submissions).

12 For the second defendant, there is a document 'Second defendant's minute of proposed orders in relation to costs' dated and filed 12 March 2012 (the second defendant's minute). For the second defendant there are also two sets of written submissions. One is the document 'Second defendant's submissions in relation to costs sought in the second defendant's minute of proposed orders dated 12 March 2012' dated and filed 12 March 2012 (the second defendant's submissions of 12 March 2012). The other set of written submissions of which I took account (see Stone [252]) is the document 'Second defendant's outline of submissions on costs of hearing 23 April 2010' filed 18 May 2010.

13 From those respective documents the positions of the parties are these.

14 The second defendant's minute calls for orders that the plaintiff pay her costs, including all reserved costs, with a special costs order for the costs to be taxed without reference to the limits in item 11 of the applicable costs scales; with the plaintiff to pay the second defendant's costs of and incidental to the hearings on 23 April and 19 May 2010 on an indemnity basis; and with the plaintiff to pay the costs of the transcript.

15 The plaintiffs' minute calls for orders that the plaintiff pay the second defendant's costs of the action relating to the perfect gift issue with exceptions. The exceptions are that there should be no order as to the costs incurred from 23 April 2010 resulting from the abandonment of the plaintiffs' claim against the first defendant; and that the plaintiff is not liable to pay the second defendant's costs from 28 May 2010, that date being the date at which the second defendant filed a notice of intention to act in person. The plaintiffs' minute further calls for orders that the second defendant pay the plaintiffs' costs of the further issues. Finally, the plaintiffs' minute calls for orders that the costs orders relating to case management hearings (including status conferences and case evaluation conferences) be vacated and there be no order as to the costs of such hearings, with exceptions. The exceptions are for the order that the plaintiff pay the second defendant's costs of the status conference on 13 December 2007 such costs fixed at $320; for the order that the second defendant pay the plaintiffs' costs of the chamber summons filed 9 April 2010 heard on 19 April 2010, fixed at $670; and the parties bear their own costs associated with the affidavit of the solicitor for the plaintiffs sworn 23 April 2010, the hearing of 23 April 2010, the hearing of 19 May 2010 and the listing conference of 13 July 2010. The first two exceptions track the orders made at the relevant conference. I return below to the affidavit referred to.

16 Out of those orders sought, I consider the following matters arise for me to address:

1. The costs of the action, with any exceptions;
2. Whether the special costs order the second defendant seeks should be made;
3. What separate costs orders if any should be made for the hearings on 23 April 2010 and 19 May 2010;
4. Whether there should be an order for the costs of the transcript;
5. Whether there should be special provision for the costs incurred from 23 April 2010 in relation to the abandonment of the plaintiffs' claim against the first defendant;
6. Whether there should be no liability of the plaintiff for any of the costs from 28 May 2010; and
7. Whether costs orders already made at the case management hearings should be vacated, with or without particular exceptions.

17 In addition, as I will explain, two further costs orders were sought by the plaintiffs, one in the plaintiffs' original submissions and one in the plaintiffs' reply submissions, which represent separate matters.

20 It is not in question that the second defendant should have an order for at least some part of her costs of the action. I consider this to be appropriate on the basis of the usual costs order, resting on the principle that costs should follow the event. See Rules of the Supreme Court 1971 (WA) (RSC) O 66 r 1(1).

21 Equally, however, where a successful party has introduced issues on which it fails, it may be ordered to pay the costs of the issues on which it has failed: RSC O 66 r 1(3).

22 However, there is a broad discretion in relation to whether costs will follow the event, a discretion which must be exercised judicially: Naidoo v Williamson [2008] WASCA 179; (2008) 37 WAR 516 [39] (Steytler P; Pullin JA & Murray AJA agreeing).

23 There is also a discretion as to whether and, if so, how to allow for the costs of issues on which a successful party has failed. On that discretion, I note three of the authorities quoted from in Kendall C and Curthoys J, Civil Procedure in Western Australia [66.1.12] (Service 132) I will reach.

24 On the discretion whether or not to make an allowance for the costs of issues on which a successful party has failed, I note Bowen v Alsanto Nominees Pty Ltd [2011] WASCA 39 (S) [5] [8] (McLure P, Newnes & Murphy JJA), referring to Amaca Pty Ltd (formerly James Hardie & Co Pty Ltd) v Hannell [2007] WASCA 158 (S), among other authorities, as follows:

It is clear that while the court has a broad discretion as to costs, generally costs will follow the event: Rules of the Supreme Court 1971 (WA), O 66 r 1(1). It is incumbent upon the unsuccessful party to satisfy the court that there are good reasons why it should not pay the other party's costs: Nikolaou v Papasavas, Phillips & Co (No 2) [1989] HCA 11; (1989) 166 CLR 394, 407.

The court may, in the exercise of its discretion, order that a successful party recover only a portion of its costs where that party has been unsuccessful in respect of certain discrete issues. But that should not be done as a matter of course. To embark as a general practice upon an analysis of which party was successful on each issue, or necessarily to deprive a successful party of some portion of its costs if it has lost on a particular issue, would be likely to add further uncertainty and complexity to the outcome of litigation, derogate from the prospect of settlement, and oblige the court to hear lengthy and frequent arguments in relation to costs as an additional burden on its resources and the costs of the parties: see MacKinnon v Petersen (Unreported, NSWSC, 19 April 1989) (Cole J); Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 [67] - [68] (McHugh J). Litigation is time-consuming, expensive and burdensome enough already.

In addition, while parties should be encouraged to consider carefully what matters they put in issue, justice may not be served if by too ready a resort to deciding questions of costs according to success on particular issues, parties are dissuaded by the risks of costs from canvassing all issues which might be material to the decision in the case: Doric Products Pty Ltd v Lockwood Security Products Pty Ltd [2002] FCA 282; NRMA Ltd v Morgan (No 3) [1999] NSWSC 768 [24].

'[T]he power to adjust an order for costs by reference to particular issues upon which the generally successful party has failed, is properly exercised only where there are discrete and severable issues upon which the generally successful party has failed, and which have added to the cost of the proceedings in a significant and readily discernible way [7].'

25 On how to make an allowance if one is considered appropriate, I note from David Weiping Chen v Kim Man Chan (No 2) [2009] VSCA 233 [10] (Maxwell P, Redlich JA & Forrest AJA) the following (references in footnotes inserted; emphasis added):

The contentions of the parties raise a number of questions relevant to costs orders on appeal. The principles relevant to these questions can be summarised as follows:

1. The general rule is that costs should follow the event. Absent disqualifying conduct, the successful party should recover its costs even where it has not succeeded on all heads of claim. [Ritter v Godfrey [1920] 2 KB 47; Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72 at 97-8 (McHugh J); 124 (Kirby J)].
2. The Rules of Court permit significant flexibility in determining questions of costs. In particular, the court is entitled to examine the realities of the case and will attempt to do 'substantial justice' as between the parties on matters of costs: Spotless Group Ltd v Premier Building and Consulting Pty Ltd and Northern Suburban Properties Pty Ltd ('Spotless') [2008] VSCA 115 , [14].
3. Where there is a multiplicity of issues and mixed success has been enjoyed by the parties, [McFadzean v Construction Mining and Energy Union [2007] VSCA 289; (2007) 20 VR 250 ('McFadzean') [157]-[158]], a court may take a pragmatic approach in framing the order for costs, taking into consideration the success (or lack of success) of the parties on an issues basis. Generally, if such an order is made, it is reflected in the successful party being awarded a proportion of its costs but not the full amount [Spotless [15]; Hughes v Western Australian Cricket Assn Inc (1986) 8 ATPR 40-748, 48, 136; Pricom Pty Ltd v Sgarioto (Unreported, Supreme Court of Victoria, Eames J, 24 April 1995); McFadzean [2007] VSCA 289, [152]].
4. A court may, when fixing costs in a claim where there has been mixed success, take into account complications which it considers will arise in the taxation of costs, as part of its consideration of the overall interests of justice.
5. Where a court determines to make an order apportioning costs, then it does so primarily as 'a matter of impression and evaluation,' [Major Engineering Pty Ltd v Helios Electroheat Pty Ltd (No 2) [2006] VSCA 114, [5]] rather than with arithmetical precision, having considered the importance of the matters upon which the parties have been successful or unsuccessful, the time occupied and the ambit of the submissions made, as well as any other relevant matter.

See also Phillips Fox (a firm) v Westgold Resources NL [2000] WASCA 85 [28] (Owen J; White & Parker JJ agreeing on this point).

26 For the second defendant it was contended that she was 'wholly successful'. I disagree.

27 The further issues were discrete and severable from the ones on which she succeeded, even although they went not only to impeach the gift, assuming it was perfected, but also to an element of the alternative basis that the plaintiffs put forward for their contention that the gift should be upheld as a perfected gift. In that last respect, had the second defendant had to rely on the failure of that element for the perfect gift issue to be resolved in her favour, her case would have failed.

28 Further, these discrete issues added to the cost of the proceedings in a significant and a readily discernible way. I accept that a substantial proportion of the hearing days, including most of the September hearing days, were concerned with the further issues, even if there were elements of the evidence relating to the perfect gift issue which were necessarily involved in those hearings and which were addressed in the second defendant's written submissions provided to the court at the commencement of the September hearing days, and also addressed in closing submissions, directly and by reference to his written submissions by counsel for the plaintiff, and by reference to his written submissions by counsel for the second defendant.

30 At the same time, I consider that the general approach referred to in Chen [10](3) is the one I should follow.

31 I have noted the submissions for the plaintiff that evidence and legal argument relating to the further issues are 'easily distinguishable' from those relating to the perfect gift issue, and 'capable of simple distillation by a taxing officer'. If such a state of affairs were evident to me, this would be a factor strongly weighing in favour of not making a percentage reduction but of making separate costs orders: see Westgold [28]. However, that state of affairs is not evident to me. There is evidence other than that referred to in the plaintiffs' original submissions which appears to me to relate to both sets of issues, in ways that do not appear to me to be easy to separate out. See the second defendant's affidavit of 8 October 2007 (exhibit 3).

32 The second defendant contends for a 10% reduction, having regard to the way in which the further issues were related to the perfect gift issue. I disagree, given the substantial effect on hearing time I have previously referred to.

33 I consider, as a matter of impression and discretion (see JCorp Pty Ltd v Australian Builders Labourers Federated Union of Workers (WA Branch) (No 2) [1993] FCA 42; (1993) 46 IR 301, 302 303 (French J) (FCA)) that the second defendant should have costs of the action, reduced by 60%. I call this the general costs order.

35 It appeared not to be in contest that the application by the second defendant is under Legal Profession Act 2008 (WA) s 280(2). However, I should note that the position appears to be that Legal Practice Act 2003 (WA) s 215 applies (see Legal Profession Act s 616(1) read with s 601 'commencement day'). At the same time there appears to be no material difference between the two provisions.

36 There also appeared to be no contest as to the applicable principles.

37 The approach to the making of special costs orders under the provisions referred to is conveniently described in Heartlink Ltd v Jones as Liquidator of HL Diagnostics Pty Ltd (in liq) [2007] WASC 254 (S), particularly [11], [16] [17] and [19]. That approach requires me to make two determinations. One is whether there is a fairly arguable case that the bill to be presented to the taxing officer may tax at an amount which is greater than the limit that would be imposed by the relevant costs determination (the first determination). The other is whether the inadequacy arises because of the unusual difficulty of the matter; or because of its complexity; or because of its importance (the second determination). See also on the second determination SDS Corporation Ltd v Pasdonnay Pty Ltd [2004] WASC 26 (S2) [106] (RobertsSmith J).

38 In respect of the first determination, I note that the second defendant did not apply for a variation of the programming orders for this determination as to costs to permit the parties to adduce affidavit evidence as to inadequacy. At the same time, I note that the second defendant did indicate she would file affidavit evidence in support if the court determined it required such information. I took this as an application for leave to permit the parties to adduce such evidence, if the court considered itself unable to make a determination without such an affidavit. For their part, the plaintiffs did not call on me to make such an order, and took a position which I took to be opposed to my making such an order on the second defendant's application.

39 I do not consider I should make an order permitting affidavit evidence as to inadequacy to be adduced.

40 It seems to me that I can proceed to make the first determination, as well as the second, as a matter of impression rather than detailed evaluation. See EDWF Holdings 1 Pty Ltd v EDWF Holdings 2 Pty Ltd [2008] WASC 275 (S) [7] (Martin CJ). I consider I can do so as the second defendant puts a case for inadequacy resting on the time from commencement of the proceedings by originating summons to the conclusion of the September hearings, as well as the number of days of hearings, particularly those representing the September hearings in which counsel for the second defendant was directly involved. It is not evident to me that I require affidavit evidence to evaluate that case.

41 As a matter of impression I am unable to agree that the first determination should be made as the second defendant contends. My focus must be on the one issue on which the second defendant succeeded, the perfect gift issue, and then only without regard to the element of the second defendant's case for the non-recognition of the will of 9 May 2007. Inadequacy arising otherwise should be set aside. As a matter of impression, I do not consider that the perfect gift issue so understood should be seen as one capable of giving rise to inadequacy. The time since the filing of the originating summons included time spent between 8 October 2007, when the second defendant's affidavit of that date was filed, and 13 August 2009, the date of a case management hearing before Registrar Johnston, over which no filings occurred and attempts were made to settle the matter. See 13 August 2009 ts 2 3. To the extent of the period over which counsel was involved in preparing for and appearing at the September hearings, it is not evident to me there were substantial costs not provided for by the relevant scale that were not due to the further issues. As I have indicated, the further issues occupied a substantial portion of the September hearing days.

42 This determination makes it strictly unnecessary for me to make the second determination. However, I should indicate my view, on the submissions put to me by the second defendant and put against those submissions put by the plaintiff.

43 The second defendant's case was put in terms both of unusual difficulty and of importance.

44 The case in terms of unusual difficulty was put in terms of the test from Como v Helmers [2011] WASC 179 (S) [18] (Corboy J), that the matter was 'more difficult than would ordinarily be expected in an application of the kind under consideration' (citing authority).

45 However, again confining my attention to the perfect gift issue, I cannot agree the matter was of that character. True it is that the legal issues involved were of some nicety and difficulty in their application: see Stone [113] [120], [125] [129], [131] [132], [137] and [142]. However, I do not consider those features made the matter one within the test in Como. Legal issues of some nicety that are difficult to apply not infrequently present themselves on originating summonses in this court. There was little difference between the parties as to the principles applicable; the differences lay in their application. See Stone [125] and [142]. The evidence for the purposes of that application was not significantly contested: see Stone [68], [74], [78] [80] and [83] [84]. Further, I do not consider that the perfect gift issue was such that those providing legal assistance to the second defendant would have had difficulty in arriving at an understanding of the principles involved or the difficulties in their application greater than that ordinarily to be expected in applications of the kind under consideration.

46 As to the case of the second defendant resting on importance, this importance was said to rest on the risk to the second defendant of the loss of the home she was occupying. Importance for this purpose can include importance to a party herself or himself: see Heartlink [19]. However, I consider I should also bear in mind that the plaintiffs' application in the originating summons was not for possession or for the sale of the residential property. Further, the plaintiffs' application was for recognition of a part interest only in the residential property.

47 I consider the risk that following success by the plaintiffs they would apply for sale of the residential property to be insufficient for the purposes of the second determination.

48 Accordingly, I would not make the special costs order sought.

Costs orders for the hearings of 23 April 2010 and 19 May 2010

49 I describe the character of what occurred at those hearings and the costs order I made at the later hearing in Stone [98] [99] and [251].

50 The second defendant's case for the order in the second defendant's minute for its costs of those hearings on an indemnity basis was that the second defendant at the hearing on 23 April 2010 decided she would not proceed with the issues of undue influence, duress and capacity on the basis of matters that importantly included the affidavit of the solicitor for the plaintiffs of 23 April 2010. That affidavit was corrected in material represented by a further affidavit of that solicitor that I considered at the hearing on 19 May 2010. That correction persuaded me in effect to permit those three issues to be further addressed in evidence.

51 The plaintiffs' case was for their order that the parties each bear their own costs associated with the affidavit of the solicitor for the plaintiffs of 23 April 2010, the hearings of 23 April 2010 and 19 May 2010, and a further hearing, on 13 July 2010, at which among other things the issues for the resumed hearing of the originating summons were identified to include the further issues. The plaintiffs' case for that order rested on the fact it was the solicitor for the plaintiffs himself who drew the error to the court's attention; that the error was contributed to by the way in which the second defendant's acquiescence in the listed hearing's duration of three hours led him, in my view not unreasonably, to conclude the claim on the further issues would not be pursued; and the failure on the further issues.

52 I accept the first and second aspects of the plaintiffs' case. In particular, having regard to them, I do not consider a case for indemnity costs has been made out. For that purpose, I apply the considerations in relation to such orders from Swansdale Pty Ltd v Whitcrest Pty Ltd [2010] WASCA 129 (S) [10] (Pullin JA & Kenneth Martin J).

53 At the same time, I note the matters of perfect gift addressed at the hearings on 23 April 2010 and 13 July 2010: see Stone [98] (last two sentences); and [100] (last two sentences). In view of that, and in view of the difficulty more generally in distinguishing between the matters in the hearings otherwise than as allowed for by the general costs order, I would not make any special provision for the hearings of 23 April 2010, 19 May 2010 or 13 July 2010, as the second defendant's minute calls for, as the plaintiff's minute calls for or otherwise.

54 The second defendant's minute, as I have indicated, seeks an order for such costs; the plaintiff's minute makes no provision for it. No submissions are made by either party for or against the order. In those circumstances I consider the matter is left to me to determine, as an application for a special costs order requiring an allowance for that cost.

55 So approached, the matter is not one for which I consider I am able to conclude as a matter of impression that there was a need for the transcript from the nature of the perfect gift issue which would justify such an order. It may be that the cost can be shown to have been unreasonably incurred; otherwise, it seems to me the cost would be recoverable, as a disbursement.

An exception for costs incurred from 23 April 2010 in relation to the abandonment of the claim for orders against the first defendant

57 The claim, under Transfer of Land Act s 203, is as I have indicated referred to in Stone [7]. That reference is brief, and there is no indication there of when otherwise than during the proceedings before me the claim was abandoned. The second defendant does not take issue with the abandonment being dated as described.

58 In my view no exception should be made as the plaintiff's minute calls for. To the extent the costs incurred after 23 April 2010 were shown to be solely attributable to the claim so abandoned, I do not consider the costs would be recoverable on a taxation in any event. However, there was a close connection between the perfect gift issue and the orders so sought, given that the claim was to give effect by that means to the declarations the plaintiff sought which rested on the resolution of the perfect gift issue in their favour. I consider that to the extent it is impossible to disaggregate the costs solely attributable to the claim against the first defendant from costs otherwise attributable, there should be not be any question of the second defendant, who was successful in the proceedings, suffering any abatement of her costs other than as allowed for in the general costs order.

59 Accordingly I would not make the exception the plaintiffs' minute provides for in relation to the costs incurred after 23 April 2010 resulting from the plaintiffs' abandonment of any claim for relief against the first defendant.

Whether there should be no liability of the plaintiff for any of the second defendant's costs from 28 May 2010

61 The potentially relevant provision in the RSC is O 66 r 8A, which reads:

8A. Costs where practitioner acts pro bono

(1) In an action or matter in which a practitioner provides free legal services to a party, the party shall be entitled to recover costs in the same manner and to the same extent as if the services were provided for reward.

(2) If an order is made for the payment of the party's costs, the practitioner may recover the amount ordered to be paid in respect of -

(a) fees for the practitioner's services; and

(b) disbursements incurred by the practitioner on behalf of the party.

62 I did not take it to be contest that an ordinary litigant in person cannot recover compensation for the time they spent in preparing and conducting their own case; however, such a person might be allowed their out of pocket expenses reasonably incurred, their reasonable expenses of preparing written submissions and their reasonable expenses necessarily and reasonably incurred in relation to the litigation of travelling or parking. See Civil Procedure in Western Australia [66.19.5] (Service 132). Whether when the litigant in person has free legal services provided to them by a legal practitioner within O 66 r 8A any of the expenses of the litigant in person would nonetheless have been reasonably incurred or necessarily and reasonably incurred, as the case may be, seems to me to be a matter for the taxing officer, not for me. No special costs order was sought in that regard here. Had one been sought, I do not consider it likely I would have granted it.

63 The plaintiffs' minute provides that the second defendant should not recover any of her costs, although I would understand the order as not affecting the possible recovery by the second defendant of the costs, Civil Procedure in Western Australia [66.19.5] above refers to. This is because the plaintiffs' case for its order is put in terms that no costs should be allowed in respect of the second defendant's time, the voluntary clerical assistance she received or the costs of counsel, Dr Hockley, who appeared for her at the September hearings and earlier provided services intended for her benefit.

64 In that last respect, it appears not to be in contest that Dr Hockley earlier provided professional advice to the individual who appeared for the second defendant at the hearing on 13 July 2010 as a McKenzie friend. Dr Hockley on 20 August 2010 informed the court at a hearing then that he acted pro bono for the organisation from which the McKenzie friend came, and that he had provided advice to that organisation to assist that individual and the second defendant. I also note, as counsel for the plaintiffs reminded me, that the transcript for that hearing shows Dr Hockley as appearing as 'amicus curiae for the second defendant'.

65 Counsel for the plaintiffs put to me that it was inconsistent with the position Dr Hockley occupied at the times of the hearings on 13 July 2010 and 20 August 2010 that that counsel at the first of the September hearings informed the court he appeared pro bono as counsel for the second defendant. I took it I should not accept at face value that latter characterisation of Dr Hockley's position. In any event the plaintiffs' case for the order they sought, at least as to Dr Hockley, was that by the time Dr Hockley first became involved, about 13 July 2010, the proceedings in the matter predominantly related to the further issues.

66 I would not make the order I understood the plaintiffs to be seeking. In my view it was clear from the 13 July 2010 hearing that Dr Hockley was assisting the second defendant, initially indirectly, then directly. This was sufficient in my view to bring his costs within RSC O 66 r 8A. Further, in view of the basis on which I concluded that the general costs order should be made, I am not persuaded considerations of the contributions the further issues made to the hearings from at least 13 July 2010 are not appropriately allowed for by that order. Finally, that general costs order in my view leaves room for a case to be put to the taxing officer for recovery of the costs of the second defendant as a litigant in person in accordance with the principles I have referred to.

Whether costs orders relating to case management hearings already made should be vacated with or without particular exceptions

68 I leave aside the exceptions made in the plaintiffs' minute to the order they seek, which as I consider were costs orders made in any event with which the plaintiffs have indicated no difficulty.

69 No submissions were directed to why I should make, as the plaintiffs' minute calls for me to make, no order as to the costs of those hearings for some of which (category 1) costs were ordered to be in the cause, in some cases fixed at particular amounts; for some of which (category 2) costs were reserved; and for the rest of which (category 3) no order for costs was sought or made.

70 It was not evident to me why for hearings in categories 1 and 2 costs should not (subject to the amount being fixed, in those cases) be as provided in the general costs order. As I have indicated, from an early stage both perfect gift and some at least of the further issues were, at least so far as the second defendant was concerned, involved in the proceedings. I do not see why allowance for that state of affairs made by the general costs order is not appropriate to the case management hearings in the present categories, let alone why the second defendant should be denied any of her costs of the hearings.

71 As to category 3, I do not see why I should make an order in relation to costs where the officer conducting the hearing did not himself or herself make one, including reserving costs.

72 Thus, I would not make the order of the present kind the plaintiffs seek. This I would understand as not affecting the costs orders the subject of the exceptions to that order the plaintiffs' minute specifies.

73 I turn now to the two matters raised in the submissions of the plaintiff which are not addressed, at least clearly, in their minute.

74 One is for the second defendant to pay the plaintiffs' costs of objecting and then arguing the objections to the admission of certain affidavit evidence, where that argument occurred on 16 and 17 September 2010. The other is that the second defendant should pay the plaintiffs' costs of preparing the plaintiffs' original submissions and the plaintiffs' reply submissions.

75 As to the first, the plaintiffs' case is that the argument resulted in consent or rulings that what in sum was a large proportion of the affidavit evidence for the second defendant was inadmissible.

76 It is indeed the case that most, and in some cases nearly all, of most the affidavits filed for the second defendant relied upon at the hearings was either as a matter of consent or as a matter of ruling found to be inadmissible.

77 However, in some cases, the matter was the subject of leave to ask questions of the deponent. Further, there were substantial portions of what was the largest affidavit for the second defendant, hers of 8 October 2007, that remained, while no affidavit for her that she sought to rely upon at the hearings suffered the fate that all of it was ruled inadmissible.

78 On those bases I do not consider I should make the order sought by the plaintiffs' minute.

79 As to the second further order, that the second defendant pay the costs of the plaintiffs' original submissions and the plaintiffs' reply submissions, I note that neither the plaintiffs nor the second defendant secured all or even most of the orders they respectively sought, at least in terms. I consider the results of their costs applications were mixed.

80 I therefore consider that it not appropriate to make any costs order in respect of either party's costs submissions.

81 I have concluded that the only order for costs I should make is that the second defendant have 40% of her costs of the action not otherwise provided for in orders previously made, including reserved costs, to be taxed if not agreed, subject to any orders for fixed costs previously made; and there should be no order as to the costs of the parties' submissions as to costs.

82 I will hear from the parties as to the detailed terms of these orders.