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[2026] QSC 67
General information, not legal advice.
Supreme Court of Queensland
2026-04-07
Sullivan J
Original judgment source is linked above.
REAL PROPERTY - PARTITION OF LAND - STATUTORY TRUST FOR SALE OR PARTITION - SALE - where the plaintiff seeks the appointment of trustees for the sale of land - where the plaintiff and defendant own the properties as tenants in common in equal shares - where the legal interests of the plaintiff and defendant are commensurate with their beneficial interests - where the defendant opposes the plaintiff's application - whether the court should exercise its discretion to appoint statutory trustees to effect the sale of the properties
EQUITY - TRUSTS AND TRUSTEES - IMPLIED TRUSTS - CONSTRUCTIVE TRUSTS - COMMON INTENTION - where the plaintiff and defendant were members of a family with an arrangement to pool monies together to allow family members to invest in real property - where monies were pooled into several bank accounts which held the monies on trust for various family members - where the plaintiff and defendant purchased two properties as tenants in common in equal shares - where the deposit was paid using monies from a bank account that was a part of the family arrangement - where the plaintiff and defendant were joint mortgagors with equal liabilities - where the mortgage loan was discharged using monies from a bank account that was part of the family arrangement - where the plaintiff and defendant both assumed responsibilities for the maintenance of the properties at various times - where evidence was given in a previous proceeding by the plaintiff and the defendant that the properties were owned equally by the plaintiff and the defendant - where there were conflicting statements by the plaintiff and the defendant as to the beneficial ownership of the properties - where the defendant submits that it was the common intention at the time of the acquisition of the properties that he would have a 100 per cent beneficial interest in the properties - whether there was a common intention between the plaintiff and the defendant as to the beneficial ownership of the properties - whether the plaintiff held all or part of his 50 per cent interest in the properties on trust for the defendant
EQUITY - TRUSTS AND TRUSTEES - IMPLIED TRUSTS - CONSTRUCTIVE TRUSTS - where the plaintiff and defendant were members of a family with an arrangement to pool monies together to allow family members to invest in real property - where monies were pooled into several bank accounts which held the monies on trust for various family members - where the plaintiff and defendant purchased two properties as tenants in common in equal shares - where the deposit was paid using monies from a bank account that was a part of the family arrangement - where there was no exact evidence as to what monies were used to make contributions to periodic mortgage loan repayments - where the mortgage loan was discharged using monies from a bank account that was part of the family arrangement -whether there was a joint endeavour between the plaintiff and the defendant to develop and sell the property - whether it would be unconscionable for the plaintiff to retain his full beneficial interest in his 50 per cent share of the properties - whether the plaintiff held all or part of his 50 per cent share of the properties on trust for the defendant
EQUITY - TRUSTS AND TRUSTEES - IMPLIED TRUSTS - RESULTING TRUSTS - WHEN ARISING - JOINT PURCHASE OF LAND - where the plaintiff and defendant were members of a family with an arrangement to pool monies together to allow family members to invest in real property - where monies were pooled into several bank accounts which held the monies on trust for various family members - where the plaintiff and defendant purchased two properties as tenants in common in equal shares - where the defendant submitted that he made a greater contribution to the purchase price of the properties - where the deposit was paid using monies from a bank account that was a part of the family arrangement - where the plaintiff and the defendant made equal contributions to the remaining purchase price by reason of a joint loan - whether the plaintiff held all or part of his 50 per cent interest in the properties on trust to reflect the defendant's alleged greater contribution to the purchase price of the property
EQUITY - EQUITABLE REMEDIES - EQUITABLE COMPENSATION - OTHER CASES - where the plaintiff and the defendant were members of a family with an arrangement to pool monies together to allow family members to invest in real property - where monies were pooled into several bank accounts which held the monies on trust for various family members - where the plaintiff and the defendant owned two properties as tenants in common in equal shares - where the plaintiff and defendant were joint mortgagors - where the periodic mortgage loan repayments were met by the monies received by way of rental and, where necessary, monies from the family's bank accounts - whether an equitable charge existed over the plaintiff's 50 per cent interest in the properties to reflect the unequal and greater contributions allegedly made by the defendant to mortgage loan repayments
Property Law Act 1974 (Qld), s 38
Property Law Act 2023 (Qld), s 34, s 37
Baumgartner v Baumgartner [1987] HCA 59; (1987) 164 CLR 137
Bosanac v Commissioner of Taxation (2022) 275 CLR 37
Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336
Calverley v Green [1984] HCA 81; (1984) 155 CLR 242
Galati v Deans [2023] NSWCA 13
Gissing v Gissing [1970] UKHL 3; [1971] AC 886
Habchi v Jason H Pty Ltd as Trustee for the Jason H Family Trust [2025] QSC 305
Hinrichsen v Hinrichsen [2025] QCA 252
Imam Ali Islamic Centre v Imam Ali Islamic Centre Inc [2018] VSC 413
Muschinski v Dodds [1985] HCA 78; (1985) 160 CLR 583
Nathan v Williams [2020] QCA 138
Sivritas v Sivritas [2008] VSC 580; (2008) 23 VR 349
Slater v Strawberry John Pty Ltd [2002] WASC 204
N H Ferrett KC, with S M Derrington, for the plaintiff
[2] This proceeding involves a dispute between two brothers, Mr Habib Habchi ("Habib") and Mr Jason Habchi ("Jason"). Without meaning disrespect to either of the Habchi brothers, in order to differentiate between them, I will refer to them as Habib and Jason.
[3] More relevantly, this dispute involves two residential properties, being 7 Mine Street, Redbank and 9 Mine Street, Redbank ("the Mine Street properties").
[4] Habib and Jason are registered as tenants in common on an equal basis on the title of each of the Mine Street properties.
[5] Jason, who is the plaintiff, seeks an order for the appointment of statutory trustees under s 38 of the Property Law Act 1974 (Qld)[1] to sell the Mine Street properties, and an order for the distribution of the net proceeds on an equal basis.
[6] Habib opposes the making of those orders and seeks other relief via a counterclaim. His relief can be broadly summarised as follows:
(a) a declaration that all, or a part, of Jason's 50 per cent legal interest in the Mine Street properties is held on a constructive, implied or resulting trust for Habib;
(b) in the alternative, Jason pay the sum of $45,084.14, being half of the sum of $90,168.27 paid on 4 May 2005 in discharge of the mortgage over the Mine Street properties, together with a declaration of an equitable charge in that amount over Jason's one-half share of the properties.
[7] It is also important to identify what is not sought in this proceeding.
[8] Neither party seeks a full equitable accounting as some form of independent relief in these proceedings.
[9] In effect, Jason relies upon the presumption that the beneficial ownership of the Mine Street properties is commensurate with the legal ownership.
[10] This is to be contrasted to Habib, who maintains that the entirety of Jason's 50 per cent interest is held on trust for him such that he effectively is entitled to 100 per cent of the Mine Street properties. His alternative forms of relief are really based on the premise that if he cannot show that he has an equitable interest in 100 per cent of Jason's legal interest, then he can show that he either has some lesser equitable percentage interest, or he has a right to an equitable charge arising from contributions he has allegedly made to Jason's legal interest.
[11] The pleadings in this case raise the following real issues.
[12] First, was there a common intention constructive trust? The onus to establish this trust lies on Habib.
[13] Secondly, was there a failed joint endeavour constructive trust founded on Habib contributing more than 50 per cent to the joint endeavour? The onus to establish this trust lies on Habib.
[14] Thirdly, was there a purchase money resulting trust claim, deriving from Habib having contributed more than 50 per cent of the purchase price for the Mine Street properties? The onus to establish this trust lies on Habib.
[15] Fourthly, and as a subset of real issues two and three, was Habib entitled to an equitable charge in respect of amounts used to discharge the mortgage debt over the Mine Street properties? Again, Habib bears the onus to establish such a charge.
[16] It was acknowledged by the Court of Appeal in Nathan v Williams [2020] QCA 138 per Brown J (as her Honour then was) at [24] (with whom Sofronoff P and Philippides JA agreed) that a common intention constructive trust has been recognised in Australian law.
[17] It will arise where the parties have agreed, or it is their common intention, that a claimant should have an interest in property owned by the other and the claimant has acted to his or her detriment on the basis of that agreement or common intention.[2]
[18] Generally, the constructive trust will be established where:
(a) there is an actual or inferred common intention of the parties as to their beneficial interest in that property; and
(b) there has been detrimental reliance on that common intention by the claimant.
[19] There is some debate as to whether there is an additional element, namely that it would be an equitable fraud on the claimant to deny his or her interest in the property. In Hinrichsen v Hinrichsen [2025] QCA 252 at [51]- [52], Doyle JA identified the possibility that there may be situations where there is some significance in the difference between establishing detrimental reliance on the existence of the common intention by the party claiming the beneficial interest on the one part, and the need to establish the unconscionable assertion of title and denial of that beneficial interest on the other part. However, the unconscionable assertion of title will generally be established where there has been detrimental reliance by the claimant. The two concepts can certainly be regarded as being closely connected.
[20] As observed previously, the onus of proving such a constructive trust lies on the party asserting the beneficial interest against the legal owner.[3]
[21] The trust itself creates substantive rights and will generally take effect from the moment on which the conduct giving rise to its imposition occurs. In that sense, it should be seen as an institutional constructive trust rather than a remedial constructive trust.
[22] In the search for a common intention of the parties at the time of acquisition, light will rarely be shed by evidence of their uncommunicated states of mind, rather it is to be inferred from what the parties do or say.[4] As Lord Diplock observed in Gissing v Gissing [1970] UKHL 3; [1971] AC 886 at 906: [5]
"As in so many branches of English law in which legal rights and obligations depend upon the intentions of the parties to a transaction, the relevant intention of each party is the intention which was reasonably understood by the other party to be manifested by that party's words or conduct notwithstanding that he did not consciously formulate that intention in his own mind or even acted with some different intention which he did not communicate to the other party. On the other hand, he is not bound by any inference which the other party draws as to his intention unless the inference is one which can reasonably be drawn from his words or conduct. It is in this sense that in the branch of English law relating to constructive, implied or resulting trust effect is given to the inference as to the intentions of parties to a transaction which a reasonable man would draw from their words or conduct and not to any subjective intention or absence of intention which was not made manifest at the time of the transaction itself. It is for the court to determine what those inferences are."
[23] It is the point of acquisition which is the relevant point in time for determining the beneficial interests of the parties. The evidentiary material from which the court might draw the inference as to intention includes the parties' acts and declarations before or at the time of the purchase, or so immediately after it as to constitute a part of the transaction. Those acts and declarations are admissible, either for or against the party who did the act or made the declaration, but any subsequent declarations will generally only be admissible as admissions against interest. In some cases, it is possible to treat the concurrence of one party with the other's payment of the mortgage instalments as an admission of the former's exclusive interest, but the circumstances attending the payment of mortgage instalments is no more than one of the relevant facts. The relationship between the parties may also be a relevant factor.
[24] The first real issue involves a determination as to what, if any, common intention was held by Habib and Jason at the point of acquisition of the Mine Street properties. The acquisitions occurred in 2003.
[25] The topic of the acquisition of the Mine Street properties and the surrounding circumstances were the subject of evidence given by members of the Habchi family, including Habib and Jason, in a separate proceeding some years after the acquisition. The content of this evidence is of importance to the real issues to be determined.
[26] In 2013, the Habchi family, including Habib and Jason, were involved in a dispute with the Australian Taxation Office ("ATO") in respect of their various taxation liabilities for a period broadly between the financial years ending 2001 to 2008.
[27] This dispute resulted in a proceeding in the Administrative Appeals Tribunal ("AAT") where, amongst others, Habib and Jason gave sworn testimony ("the AAT Proceeding").
[28] The position advanced by Habib in the AAT Proceeding, both by a statement of facts, issues and contentions ("the Statement of Facts") he had approved, and by his sworn evidence, was that a particular fruit business known as Farmer Charlie's Fruit Market ("Farmer Charlie's") was owned equally by Habib, Jason and his sister, Marina, in a three-way partnership. Consistent with Habib's evidence in the AAT Proceeding, each of those three siblings had signed and filed tax returns for the financial years ending 2001 to 2005 that showed that Farmer Charlie's was operated on the basis that each of the three siblings held a one-third interest in the partnership.
[29] Additionally, the position advanced by Habib in the AAT Proceeding, both by the Statement of Facts and his sworn evidence, was that an arrangement known as the "Family Arrangement" existed, whereby income from various family members was placed into a number of bank accounts, and those accounts were then operated as a pooled resource for the larger family to advance monies to individual family members, primarily for the acquisition of real property. Those advances from the pooled resources were said by Habib in the AAT Proceeding to be loans.
[30] Both before and after 2003, a number of pieces of real property were purchased in a variety of family members' names. In the case of the Mine Street properties, each of those properties were purchased in the names of Habib and Jason as tenants in common in equal shares.
[31] In the AAT Proceeding, Habib gave sworn evidence as to the existence of the Family Arrangement, to the existence of the three-way partnership in Farmer Charlie's, and to the purchase of the Mine Street properties with his brother Jason on a 50/50 basis.
[32] The Statement of Facts was prepared for the AAT proceeding by a Mr Drakos, who was a solicitor acting on behalf of the Habchis. It is dated 6 March 2013. Habib agreed in cross-examination at trial that this document was reviewed by himself, and that if there had been anything in the document which was untrue, he would have told Mr Drakos.
[33] The Statement of Facts set out with specificity the nature of the Family Arrangement. It is relevant to reproduce certain portions of it:
Facts relevant to all Applicants: The Family Arrangement
1.22 The Family Arrangement involves a combined family initiative for providing loans to family members.
1.23 The purpose of the loans was to assist family members to become financially established.
1.24 The loans were used for the acquisition of financing (including repayment) of properties.
(b) repayments and contributions made into family bank accounts; and
(c) borrowing against the equity in existing family-owned properties.
1.26 The Family Arrangement requires that the loans be repaid when the recipient has capacity to do so.
1.27 This feature ensures that the capacity to provide loans is not exhausted amongst older family members; and allows similar assistance to be given to younger family members at a later time.
1.28 Accounts were utilised in the course of the Family Arrangement are:
1.29 The bank statements for these accounts show that under the Family Arrangement:
(a) money was transferred between these family accounts;
(c) transfers and withdrawals occur for loan and interest repayments..."
[34] In respect of the Mine Street properties, the following was specifically identified in the Statement of Facts:
1.51 On 13 January 2003 Habib, together with his brother Jason, purchased two houses situated at 7 and 9 Mine Street, Redbank, each house costing $70,000...
1.52 Jason relied on Habib to undertake all the arrangements for these purchases.
(a) a Commonwealth Bank loan account number [XXX 3208];
(b) loans under the Family Arrangement from Suncorp account number [a]..."
[35] A sworn witness statement by Habib from the AAT proceeding was also put into evidence at trial. That sworn witness statement included the following evidence by Habib:
[36] In relation to the Mine Street properties, the sworn witness statement of Habib stated, in effect, as follows:
[37] More generally in the sworn witness statement of Habib, he stated, in effect, as follows:
[38] In the AAT proceeding, Habib gave the following sworn oral evidence.
[39] In relation to Farmer Charlie's and the Family Arrangement, he relevantly stated:[6]
"MR HABCHI: So we started the business Farmer Charlie's. When we registered the - - -
MR HABCHI: We took - I took the business as Farmer Charlie's and started it from scratch. We didn't buy it. We took a fresh lease from The Professionals in Oxley (Indistinct) and I started that business. Dad, you know, would help us as children and whatever, and when you look at that Suncorp family trust account or whatever, that is money that belongs to what you want to call the family. It's not dad's money, it's not mum's money, it's not Habib's money, it's not Jason's money; we put money together as a family. So that maybe can - understand a little bit about why it's in a trust account for dad.
Now, if dad wants to go to the casino, we don't tell him no, you know, but that money is not dad's money. That money is for the family to - the goal is always in - like, our culture, and I think the way we have been brought up is, like, whoever needs something, everyone helps out and gives in. You know, like, for example, when Habib wanted to buy his first house, well, dad took money out of that trust account and gave it, you know, 20,000 or $30,000 as a deposit, and then we borrowed the rest of the money from the bank. Get back to the start again and we will come over these things.
So we started Farmer Charlie's and we opened Farmer Charlie's in Habib and Jason and Marina's name. Jason was at school at the time, or studying to be a builder. He wasn't operating in the business. He didn't know any thing about the business. He did not know about fruit and veges. Marina, my sister, she was - you know, we would put our names on the business. Like, my thinking of what I'm doing is to share whatever profits between the family to obviously not be one person's all income because we are a family unit. Marina as well, she didn't work in the shop.
She worked in the shop, like, serving at the register, sorry, but nothing to do with buying fruit and knows what this was and what this was regarding, all these financial and T-docs and whatever. So Habib operated this shop and Habib was sort of, like, the representative or the leader or whatever Habib said in the family everyone did, or if Habib wanted $20,000 we would collect this money between each other and Habib wants to buy a house, and we bought that house for Marina, we bought that house for Jason, we bought that - so we operate this business, Farmer Charlie's, and then we go to - when we open the shop, we go to the CBA Bank branch in Oxley to open a bank account.
At that time, we hadn't registered the name Farmer Charlie's so the bank told us, "You can't open a bank account in Farmer Charlie's name because you have got to have it registered with the BN number and whatever," so because we couldn't wait, we opened the bank account in Habib and Jason Habchi's name because Marina wasn't with us during the day to open Habib and Jason and Marina, so we opened it in Habib and Jason Habchi's name. So the business of Farmer Charlie's was in the account of Habib and Jason Habchi, and if I remember correctly, it's that 2271 bank account for Farmer Charlie's.
MR HABCHI: So Ranya never earnt any money, she never had an income. My sister, Marina, that's a different story. Marina was married to her husband, I don't know what her husband did after 2006. But as long as they are, like, within my family unit when they're at home with mum and dad and all of us, I know my sister from 2001 she was a shareholder in Farmer Charlie's. Farmer Charlie's, we told her, "Mimi, go work, try and get some more money just in case we can't pay the rent or can't pay somebody, so we have some money."
She can go work. Jason is studying. I'm in the shop. And then we all help each other out. 2003, this Fruit Direct stuff exploded. 2006, opportunity comes up in the markets, I go to the markets. My sister gets married, Mimi, I think in 2006, and she goes and lives in Sydney. What happened in 2006 I don't - I can't explain, like, for my sister Marina. But prior to that, Marina, Moni and Ranya absolutely have had no - well, sorry, Marina has earnt some income but Moni and Ranya have not earnt one income because it's all borrowed money. How else can I explain things?
[40] Generally as to how members of the family acquired property, Habib gave the following answers:[7]
"MR HABCHI: It is a mess. Even I know it's a little bit of a mess. It's not - but that's - we're one unit, we are - and what other accounts can I explain for you? Okay. See, for example, in 2001 a property, 61 Cook Street, that's the first house I bought in my name. We paid $109,000. In the asset betterment or in the assessments that the ATO has done, they haven't recognised any loans. I can show you that there is an ING Bank loan attached to that. I borrowed - I got a $7000 first home owner grant which the government hasn't seen. There has been dad's transfer, which you can easily identify which - I know I have got it somewhere.
It's in the witness statements of Stephen Haines. You can see the transaction from that trust account to - for settlement for that deposit, and then you can see the other bank money coming in for $109,000. In the asset betterment test of the ATO or the way they are calculating our assessments, whichever one it is, they are saying Habib had no loan. I bought that with $109,000 of cash or whatever, and they are wanting me to explain where the income - it wasn't income. I didn't have cash. All our properties were purchased by debut and they are continually being refinanced as equity increases and we are continually buying another property as I see equity. That's how our property assets - we are making property, and to this day, we still have - this debt is continually growing. As we buy another property, we have a bigger debt. As we buy another property, we have a bigger debt.
SENIOR MEMBER: Are you effectively leveraging yourself? Yes, you are. You will be leveraging yourself into more properties.
SENIOR MEMBER: You don't necessarily own much. You didn't have large equity in any of them.
MR HABCHI: No, I had no equity. The good thing that happened to me - and I'm scared the ATO wants to take it all away from me, is because the property value increased. These properties were in 2001. We bought these properties for 85,000, 109,000. Over that period of time, what is the value of one of those houses now? Maybe $400,000. So that - equity is the way we are financing to buy more properties. We are not buying more properties from income that we haven't declared or income that I have found from the air. Money can't fall from somewhere, your Honour. You have to - I'm substantiating or showing you the source of how we are buying the property, and we had good fortune. We struggled to get the deposit, we got the bank loan and then equity goes up.
[41] In relation to the Mine Street properties, Habib gave the following answers:[8]
Now, you purchased that with Jason, didn't you?---Yes.
Did you ever live in that house?---No, we didn't live in that house.
And there is another house there - sorry. And how is the $70,000 purchase price - how did you come up with that money?---We, you know, you have got the bank statements for that Suncorp trust account, so we - mum - dad, the trustee of that account, transferred the deposit and we borrowed the balance from the bank, the Commonwealth Bank.
Okay. And you are still half owner in each of those properties?---Yes, yes.
[42] In relation to Suncorp account number [XXX 8620] and NAB account number [XXX 8847], and the family arrangement, Habib gave the following evidence:[9]
"SENIOR MEMBER: Right. And the trustee account that your father - - -
SENIOR MEMBER: - - - for which he is the trustee that sits outside all of that?
MR HABCHI: That sits outside of all of that. The trustee account that my father is the trustee for which is most of the family member's children - children's name sits outside of all that and then like all of us from - or mum and dad from 40 years ago have been saving and whatever we can put together that would go under the umbrella of that trustee account and then dad would give us money to buy from that when we needed to buy a house or something as a deposit.
MR HABCHI: Okay. That's a loan account, that's borrowed money from the bank. The four-way account is borrowed money from the bank. 8847 is just a clearing house for the NAB accounts. 3661 and the other one, I think, is 3741 they're all loans; they're not income.
SENIOR MEMBER: And where did that money go to? It goes out on properties?
SENIOR MEMBER: Properties purchased in the individually family member's names?
MR HABCHI: What we did, your Honour, when we first bought the property, I think, most of the property we bought is one in 2001, one in 2002, one in 2003, something like that and they were all individually loans from ING Bank, from a Commonwealth Bank, every loan was individually borrowed. What we did in, I think it was 2005 or 2006 when this 8847 account showed up we refinanced and got a line of credit on a number of the properties. So do you want to keep this or ds - - -[?]
[43] Jason also gave sworn evidence in the AAT Proceeding. A portion of the transcript of his evidence was tendered at trial. Jason gave answers to the following effect:
"Yes. In 2002 you purchased, with your brother, a place at 7 Mine Street?---A house, 7 and 9 Mine Street.
And you rented those out; is that right?---Habib - Habib purchased the houses; he put them in both our names and I believe so; I'm not sure.
You don't know if those - - -?---I don't know. We purchased them in joint names. Habib used to handle those properties. Yes."
"What about Oldfield Road, Sinnamon - - -?---I don't - I don't - I don't comment on that. I just - I don't know nothing about that house. Apparently my name was in the house but I don't remember, I don't recall. Was my name in the house? I can't, yes. I don't remember and I don't recall. Habib used to handle our financial affairs back then. If he tells me to sign, I used to sign."
[44] It seems that at some stage during the AAT Proceeding a document had been produced by the ATO called "A calculation of taxable income by asset betterment method". It had a calculation for Habib, both in terms of his assets and liabilities. The entry for the Mine Street properties showed Habib having a 50 per cent ownership and having a 50 per cent liability for the CBA home loan for those properties at the time of acquisition.
[45] The Statement of Facts and Habib's sworn evidence was consistent with this entry in the ATO document.
[46] In the current proceeding, Habib effectively contends, amongst other things, that the various positions which he advanced in the AAT Proceeding were false. He now contends, in effect, that:
(a) the Farmer Charlie's business was at all times beneficially owned 100 per cent by him;
(b) the Mine Street properties, and indeed all the properties acquired at this time, were 100 per cent beneficially owned by him;
(c) the monies used to pay for the Mine Street properties were all Habib's, this included the monies from the Suncorp account number [XXX 8620] (for the deposit) and NAB account number [XXX 8847] (for the discharge of the mortgage debt); and
(d) no Family Arrangement existed at the relevant times, the only arrangement was what Habib called the "Habib Arrangement", namely all the monies and all the properties were 100 per cent Habib's.
[47] Habib's evidence at trial was consistent with the new contentions. For example, his evidence included the following:[12]
"HIS HONOUR: So I'll rule on that after Mr Ferrett considers the matter. So what's next?---I'm going to now run you through - because my dad's the trustee of that Suncorp trust account, I'm going to show you my dad was a pensioner since 1998 and he doesn't even recall opening that account from the ATO documents that - that's already been tendered. So - - -
How does this go - sorry - - - ?---So, I'm going to show you that my dad and when they say "Habchi family arrangement", that word should be "Habib". It shouldn't be - you know, my sisters are young, no one works. My sister Marina was working at Virgin Airlines, earning about 500 bucks a week and Jason was unemployed at the time, trying to get his TAFE college to get a builder's and my dad was a pensioner. All right. So when they talk about this "Habchi arrangement", it's Habib. It's all Habib's money. "Habib arrangement' it should be. But anyhow, if you look on page 1021, your Honour, and look at point 25. Around about - I'll start at 20 and:
It also seems to be another pension being paid into this account. Do you agree with that? So on 3 January there were two pension payments? Do you agree with that?
Is the other pension payment your wife? Is it? Maybe.
That's evidence in another proceeding. It's not evidence in this proceeding?---So this is evidence relating to the Suncorp bank account. My father had no money. My father was a pensioner. I'm showing you that so when I go back to the Suncorp bank account and show you all the deposits, who's depositing that money. The heir's not depositing it. Jason's not depositing that money. My sister's not depositing that money, and then they can't come up with some story that my dad deposited that - my dad's a pensioner. My dad had no money. My dad is a gambler.
Yes?---Habib owned Farmer Charlies. All the money in Farmer Charlies, when we purchased Farmer Charlies and when I renovated Farmer Charlies and when I made it a fruit shop, I did. When Habib owned W Arkell and Sons in the Brisbane Markets, Habib used to buy and sells fruit and vegetables in the Brisbane Markets and trade. And in 2003 to 2008, we were also exporting apples in large, heavy volume with lots of money. I was the only person, at this time, that could have the capacity to do these deposits and to buy and sell houses.
Other then when you say your father took money out to gamble and then put - - -?---Yes, yes.
Page and where it is?---So I - I'll tell you how this money came about and how everything came about, so just to put it into context, right? Prior to Farmer Charlies, I owned another fruit shop with my Uncle Sam in Stafford called Fresco's Fruit Market. So I had finished from Sam. He paid me my half and whatever. And I brang that money, and I opened the shop Farmer Charlies. And then I put the money into a trust account, and that account I opened, Habib and Jason Habchi, the Commonwealth Bank Account. And that was the trading account for Farmer Charlies. But no one ever contributed with me because they didn't have any money to contribute when I opened the Farmer Charlies business. But I used - just like I used my sisters in that 8847 account, I used Jason's name and my sister's name to make it as a partnership: Habib and Jason and Marina's partnership for the Farmer Charlies.
Sorry, explain that to me one more time?---So just like in 8847, I never always used my own name. I always used my family member's name like a shelter for me to operate. So for risk, for financial structuring and whatever, I always used my family members as a shelter for me to trade. So when we did Farmer Charlies, Farmer Charlies was all of Habib's money. I was in the fruit shop, and I used my sister Marina and Jason as - trading as Farmer Charlies. Like, it was a three-way partnership on the documents with the tax. But it was not really a partnership. It was - it's Habib. So then we open Farmer Charlies in 1999, and we traded. And so money - and then I used to sell, at the same time, mangoes on the side of the road which I talked about. And I'd collect cash from the side of the road and from Farmer Charlies. Whatever money we didn't have to put in that 2271 account to pay the market bill and the rent - whatever - I would sink in here.
HIS HONOUR: So what page?---So then on page 63 - I'm trying to find that deposit. Where is that - there it is there. I think - you know the $40,000 deposit you just referred to from this bank account? I've tried to find it, and it doesn't make sense from what I've read. But I believe from my - from what I know and me digging up who the real estate agent is because I've brought the property, I'm sure when we - no one else knows who the real estate agent is because I brought the property. Not my brother. But anyhow, I think the real deposit is 25,737. That's the deposit, I think, though. The owners of the land, if I remember correctly, that I purchased it from, was AI Caswell. So you can see in the space of one month - - -
All right. And where do I see this?---On the 10th of the 1st, about a third down the page. AI Caswell. You'll see a cheque being drawn for $25,737.61. That is the deposit for 7 and 9 Mine Street. And what I'm trying to show you is we just paid out Jason's Esanda Finance because he couldn't make the repayments and I'm telling you that's from the 9th and from the 12th. How could he - he doesn't have any money on it at that time to purchase. He doesn't have the capacity to buy property at that point in time and he owes me $28,381. That's paid out his car. He had a HSV Commodore with Esanda Finance or some finance company and we paid it out because he couldn't make the repayments and that's the same thing what I was showing you before in the Bank of Queensland. His house he purchased at 64 Tarragindi Road, he couldn't make the repayments and then I paid $675,000 to pay out his house, but I left it in his name.
Continue on with your answer, Mr Habchi?---So if you remember at the start, I said there's no family arrangement in the instance that my sister had money or Jason had money or anyone had money. It was a Habib arrangement at the time, because the family was Habib. Because Habib was the only source of money at that time. Because my dad was a pensioner, my mum's a pensioner. Jason's still 21 years old. My sister, Mimi, she was - worked for Virgin Airlines. And the only person that was making money in the amounts that you could buy property at the time is Habib. When we came to 2014, when we included this 7 and 9 Mine Street in the family agreement, I didn't have cash then. So then we made a family agreement so we know what we're doing in the future. Then my brother, we - I don't know if I'll go into this again. I surrendered those assets to my brother and told my wife to do a power of - because everyone knows I bought those properties. Jason owns another property in 59 Cook Street. I never asked him for that because he used his money to buy that. I'm not going to go to Jason and say I own half of 59 Cook Street. These properties at that time, I purchased them in their names. Jason purchased 59 Cook Street at a different time when he had money. He didn't have money back then and, when you talk about family, the family arrangement, at that time, I'm saying it's a Habib arrangement. There was no other family member pooling money with me at that time.
[48] In relation to the Mine Street properties, Habib says that it was his and Jason's common intention at the point of acquisition that both of those properties were to be beneficially owned by Habib.
[49] Habib contends that what was represented by himself and other members of the family in the early 2000s to have been the true legal and equitable position for both the Farmer Charlie's business and the Mine Street properties was falsely done for the purpose of asset protection and taxation reasons.
[50] Habib was given a warning against self-incrimination several times during the trial in respect to evidence he may give about the truth of the evidence he gave before the AAT. At one stage during cross-examination, in respect of the alleged misrepresentation as to the true beneficial interest in Farmer Charlie's and the Mine Street properties, Habib gave the following evidence:[13]
"If we come over the page to - if we come over the page we see a similar set of questions starting at line 9 about Mine Street?---Yes.
All right. You understood, didn't you, that one of the - one of the things that was in issue - - -?---Yes.
- - - was who was going to be liable for any tax that arose from paying those - from the income from those properties; correct?---Yes.
And you didn't think to say, well, look, Jason is on the title, but I'm the real owner?---Yeah. I am the real - I - I am the real owner.
You didn't say that in the hearing anywhere, did you?---Yeah. It doesn't say who paid for the house.
MR FERRETT: - - - you were the real owner, did you?---Sorry?
You never told the senior member in the AAT that you were the real, 100 per cent owner of either of those Mine Street properties?---He didn't ask for me to tell him.
You understood, though, didn't you, you were explaining your affairs so that people could assess - - -?---Where - where - - -
- - - so that the Tax Office could assess tax?---Yeah. So - so as a normal person, as normal people do, they try to save money on tax, on going shopping at the - finding a discount, bread at the shop. Everyone - everyone is - is doing - yeah. You - you're trying to save money.
MR FERRETT: What you really mean by that when you say normal do it this way, is that what you say to the Tax Office is one thing - - -?---Yeah.
- - - and what you say is the truth is another; is that what you're saying?---No. No.
All right?---You - you are holding something for me in trust. You haven't paid for it. If you pay for it, it's a different story.
[51] There can be no mistaking the evidence of Habib at the trial. It was directly inconsistent with the Statement of Facts and his sworn evidence in the AAT Proceeding on:
(a) the ownership of the Farmer Charlie's partnership;
(b) the existence of the Family Arrangement; and
(c) the ownership of the Mine Street properties.
[52] The two sets of positions taken by Habib cannot be reconciled with each other.
(d) Post-acquisition conduct relied upon by Habib
[53] In large part, Habib sought to rely on certain post-acquisition conduct by Jason as constituting admissions or acknowledgements that Jason had always understood that the Mine Street properties were to be entirely beneficially owned by Habib. He also sought to rely on the content of certain documents as constituting prior consistent statements by himself to rehabilitate his credit where the allegation from Jason was there had been recent fabrication by Habib.
[54] The context for this evidence is that in 2008 Habib left Australia to reside with his wife in Lebanon. He remained overseas until approximately 2014. He returned to Australia periodically during that period but he did not permanently reside in Australia at that time.
[55] On or about 29 September 2014, a deed of settlement ("the Settlement Deed") was entered into between the ATO and six members of the Habchi family, including Jason, Habib and their father, Peter. Its purpose was to resolve the then dispute over taxation and, amongst other things, put in place agreed assessment values for the six family members who were a party to the deed. This included an agreed assessment value for Habib of $491,133.09, an agreed assessment value for Jason of $185,897.88, and an agreed assessment value for their father of $335,551.09. The total settlement sum to be paid by the Habchis was $1,257,775, to be made in three tranches, as follows:
(a) $400,000 within 21 days;
(b) $400,000 within 12 months; and
(c) $457,775 within 18 months.
[56] The Settlement Deed provided that the Commissioner of Taxation would apply the payments in a set priority hierarchy. Jason's tax liability was to be met first, Habib's tax liability was to be met fourth and their father's tax liability was to be met fifth.
[57] The Settlement Deed with the ATO was agreed to be made without admissions by any party.
[58] At the time the Settlement Deed was being entered into, Jason and Habib entered into an agreement known as the "Family Agreement".
[59] The Family Agreement was between Habib and Jason and provided as follows:[14]
This Agreement is to provide clarity for future business relationship as follows:
HPH has accumulated property assets since 1999 and since 2008 a tax dispute has been ongoing.
During this period JH has expended personal Cash to cover expenses related to the ongoing tax dispute.
On 29 September 2014 a Deed was executed for settlement in the total amount of $1,257,775.00 to be paid within 21 days of execution $400,000.00 following 12 months further $400,000.00 following 6 months balance $457,775.00.
61 Cook Street, 63 Cook Street, 47 Ellen Street, 115 Main Greenswamp Road, 13 Quarry Road, 538 Sherwood Road, 35 Strauss Place, 64 Tarragindi Road, 7 Mine Street, 9 Mine Street.
JH cash paid approximately $700,000.00 (JH to confirm this amount) plus further $400,000.00 within 21 days for Deed executed total $1,100,000.00.
On execution of this Agreement HPH will give full control of all assets and income from all the above assets to JH.
JH is to offset $1,100,000 at his discretion against Bank value for above properties.
In exchange JH will make HPH a partner 50-50 for any development or property purchase from the date this agreement is executed, including the property at Stanley Street, Indooroopilly development.
For any personal Cash JH expends he can at his discretion either offset against Bank value of above properties or recover and deduct cash at end of development before distribution.
On completion of any development JH can distribute at his discretion.
[60] Habib relied upon the statement in the Family Agreement that he had "accumulated properties". He submitted that "accumulated" meant he had accumulated the entirety of the beneficial interests in the properties despite some being registered partly in the names of other family members. The "accumulated" properties were as follows:
(a) 61 Cook Street;
(b) 63 Cook Street;
(c) 47 Ellen Street;
(d) 115 Main Greenswamp Road;
(e) 13 Quarry Road;
(f) 538 Sherwood Road;
(g) 35 Strauss Place;
(h) 64 Tarragindi Road;
(i) 7 Mine Street; and
(j) 9 Mine Street.
[61] There is no allegation in this proceeding that the Family Agreement legally operated so as to alter any legal or beneficial interest in the Mine Street properties. The operation of the Family Agreement, and its potential breach, are being dealt with in another proceeding. That other proceeding has already been the subject of separate questions answered by Freeburn J in Habchi v Jason H Pty Ltd as Trustee for the Jason H Family Trust [2025] QSC 305.
[62] The relevance of the Family Agreement for this proceeding is as post-acquisition conduct which is said to support the prior common intention now contended for by Habib.
[63] In addition to the Family Agreement, Habib pointed to other communications between himself and Jason, both pre and post the Settlement Deed.
[64] In an email chain commencing 8 July 2013 at 6.50 pm, Habib had written to Jason and to his father. The first email stated:[15]
"I have sat down with DAD and gone through his spreadsheet for ownership.
We discussed and he said we must make clear the ownership of properties and then decide later weather we combine or work together.
These properties will be mortgaged to Jayhab Developments Pty Ltd and the ownership will always be as in spreadsheet
The total LOC with BOQ 2,000,000 is to be for Habib 1,300,000 and Jason 700,000.
[65] The attachment to that email had a spreadsheet of properties and three execution places, one for each of Habib, Jason and their father, Peter, respectively. Relevantly, the spreadsheet included the Mine Street properties, which were both recorded as being 50 per cent owned by Habib and 50 per cent owned by Jason. The property at
64 Tarragindi Road was recorded as being owned by Jason 100 per cent and 47 Ellen Street was also recorded as being owned by Jason 100 per cent.
[66] On 8 July 2013, at 11.13 am Jason responded to Habib as follows:[16]
The rest of the properties belong to you and the rest if family"
[67] Habib responded on 8 July 2013 at 2.59 pm as follows:[17]
What do you mean 100% you've not paid I off 64 Tarragindi Rd you have not even paid all the interest.
Please make everything clear do not make confusion.
[68] Next, Habib relies on various text message or email chains from 2019 and 2020.
[69] It is clear enough that by the beginning of 2019, Habib and Jason had fallen into dispute about the operation of the Family Agreement. On 3 February 2019, the following email messages were exchanged:[18]
"As discussed in tmrw transfer title for Apartment and further make calculations and distribute balance in apartments.
For 10 years you have had my properties for security and you have not distributed nothing."
"We are not transferring any titles. Distributions will be made after all townhouse at gap are sold, as we have discussed timd and time again.
Stop emailing Andrew as he has nothing to do with you. Send your queries direct to me"
[70] There was then an email from Andrew Hanna, who was somebody involved with Jason in the development of a property at The Gap which was being discussed in these texts. Mr Hanna stated, in effect, that he does not wish to be involved in Jason's and Habib's dispute.
[71] Habib then made a demand to Jason for a unit to be assigned to him and closed the communication by saying:[19]
"10 years and nothing...No more excuses and bullshit"
"NOT TRANSFERRING ANY UNITS. YOULL GET YOUR PROFIT SHARE ONCE THERE IS PROFIT TO DISTRIBUTE"
[74] Jason replied that he was happy to sit down and go through everything, and that he had all the figures. Jason suggested a meeting at their father's house the following day.
[75] The final email message in this 3 February 2019 chain was from Habib as follows:[22]
"I don't want to discuss it it will same story as before
You guys cannot make money with my assets and I don't want anything to do with you
Work out and give back properties and make settlement for all and work yourself
Don't tell me wait anymore because that piss me off."
[76] Habib relies upon the references to "...my properties" and "...my assets" as a reference to the identified accumulated properties referred to in the Family Agreement. In effect, Habib relied upon the references as constituting prior consistent statements by him.
[77] Next, there was an email chain commencing on 25 June 2019 and ending on 26 June 2019. They related to a dispute which was similar to the one being dealt with in the previous email chain. Habib was looking for a distribution of profit from the Family Agreement and particularly from one of the developments that had occurred. Jason was disputing that there should be any such distribution.
[78] Relevantly for this proceeding, on 26 June 2019 at 12.24 pm, Habib wrote, in part:[23]
You have been using assets for your personal benefit (10 years) You have distributed anything from Lantona which holds assets that you have rolled over"
[79] Jason responded, indicating why, from his position, nothing was distributable at that time.
[80] This led to a further email on 26 June 2019 at 4.36 pm from Habib, where he stated, amongst other things:[24]
"You have Habib assets in your possession you transfer titles and you use assets for your own benefit.
First step is to return these then you can calculate like you are.
You are not owed anything until you return Habib assets.
After 10 years and using all Habib assets with value of approximately $6M which can service itself (you used at your discretion) You want to own half of this for nothing and then on top of that I owe you money And the only distribution after 10 years is $150k
I understand now why you are embarrassed and want somebody you don't know to sort this out.
2. 1 AUG 2019 I will prepare 2 options with independent person 3. 1 SEP 2019 you will reply to either and make your changes if needed 4. 1 OCT 2019 we agree on something and put this behind"
[81] Jason replied to this email on 26 June 2019 at 4.51 pm as follows:[25]
"I don't agree, we can settle now get an accountant. I'm sick of this. Without me you wouldn't have any assets. Take your assets but give me back the money I'm owed. You have done nothing and contributed nothing. I don't need your assets never have needed them. You put a huge burden on me when you fucked off to Lebanon and left everything in chaos. I SAVE YOUR ASSETS otherwise the ATO would have taken them you remember that. If it wasn't for you putting me in this mess I would have been much better off. You have never put your hand in your pocket for anything. Who do you think you are, dictating terms to me of when I should put money in your account. Screw you. You should be ashamed of yourself"
[82] Habib then issued an email requesting figures for the value of the Lantona development with him saying he would organise finance and settle this.
[83] On 26 June 2019 at 7.42 pm, Jason then emailed as follows:[26]
"Will gladly do this. I'm preparing June 30th 2019 financials for lantona. Redbank will have free title. Your shed will have free title and you can transfer back in your entity. Currently LOC has 2 million owing. Work out how you want to settle this because as per my current spreadsheet I am owed over $1,600,000. When I work out your share in lantona then perhaps we can offset it against the 1.6 mil"
[84] I pause to note that the reference to "LOC" is a reference to a line of credit which had been previously put in place and the reference to "Redbank" was a reference to the Mine Street properties which were in the suburb of Redbank.
[85] Habib responded by asking for the accountant to do certain work in relation to the Lantona development. There was obviously some type of spreadsheet in existence at the time and there was an indication that Habib did not agree with its content in full. That spreadsheet was not in evidence. There was some further emailing where Jason indicated that he was under pressure.
[86] Again, Habib refers to these chains of emails as containing admissions by Jason that there was a mutual understanding that the accumulated properties were, in truth, Habib's properties, including the Mine Street properties, and, where applicable, constituted prior consistent statements by Habib that he owned the properties outright.
[87] The third chain of email messages commenced on 29 August 2019 at 7.04 am. This chain of emails starts with Habib emailing an NAB officer and copying in Jason and "Andrew", whom I infer is the same Andrew Hanna who had been working with Jason. The email is acrimonious and states:[27]
You transfer properties that rightfully belong to Habib and use Jason and Andrew property.
Today you release properties and take your security on Jason and Andrew."
[88] This then drew a response from Jason on 29 August 2019 at 9.04 am, where Jason emailed directly to Habib only. It relevantly stated:[28]
"Stop making false accusations and claims. We have agreement in place signed by both you and me and a solicitor and we are in agreeance of moneys owing to Jason Habchi. If you wish to terminate our agreement, I am happy to do so but it must be handled in a professional manner. Your abusive out burst and random rants towards toward my colleagues will not be tolerated. This behaviour is not acceptable nor will it be responded to. I suggest you handle this more professionally manner or go seek legal advise because what your demanding make absolutely no sense. Be professional and I'm more then certain this can be resolved. The more you carry on the way you are. The worse this will get.."
[89] This, in turn, drew a response from Habib on 29 August 2019 at 9.09 am, where he stated to Jason:[29]
"The longer you delay and hide and talk bullshit This going to get much worse
Go get value for Lantona and make meeting today with solicitor and split
The last thing you want is HABIB to become your enemy."
[90] Jason responded to Habib by an email message later on 29 August 2019, copied to Jason's solicitor, indicating his accountants were doing a valuation and that certain profits were to be exported to Jayhab Developments Pty Ltd and from there split with the termination of their agreement.[30] It then provided:[31]
"Don't make contact with me anymore. I suggest you get yourself a solicitor to handle it from here on. I have already engaged mine. You are unreasonable and un predictable. Any further requests, please send directly [to his solicitor]."
[91] Other contemporaneous email messages at about this time reflected the fractious relationship between the brothers. An earlier email on 28 August 2019 from Jason to Habib stated, amongst other things:[32]
[92] A responding email from 29 August 2019 from Habib stated, amongst other things:[33]
[93] It is fair to say that the relationship between the brothers had well and truly broken down by this date.
[94] The fourth chain of messages commenced on 21 August 2020. This chain also concerned the ongoing dispute over the Family Agreement. On 21 August 2020 at 17.07, Jason wrote to Habib as follows:[34]
[95] This was followed immediately by a further text from Jason which clarified as follows:
[96] The chain then proceeded with Habib talking about when a split was to occur and his asking for a response from Jason.
[97] Later, Jason stated in two text messages on 21 August 2020 at 17:16:[35]
"I am not extending LOC. Take propertys and refinance
And you can have Beenleigh also. I want to finish from this..."
[98] Then later at 17:24 after further texts, Jason stated:[36]
"Look at all the spreadsheet that I have sent you. Not going through this again. It's all there
I'm just letting you know that I'm not extending the facility for XP. If you want it take it and all your properties and you can even take Beenleigh. If not, then we have to sell to pay back LOC."
[99] The messages continued on, discussing an apparent disagreement about the spreadsheet referred to. The spreadsheet being discussed was not in evidence at the trial.
[100] Habib relies on the reference to Jason saying, "...take...red back...", and "...take it[37] and all your properties", as constituting admissions by Jason that there was a mutual understanding that the accumulated properties were, in truth, Habib's properties.
[101] Finally, Habib then points to a chain of emails on 6 April 2020.
[102] The first email is from Jason on 6 April 2020 at 1.17 pm as follows:[38]
If splitting everything then you take over/refinance LOC and the properties that you will have in your possession is as listed below
Note. I have taken Mum and Dads house off this list as I believe there house should be unencumbered. But this is up to them"
[103] Shortly thereafter, Habib responds at 1.39 pm on 6 April 2020:[39]
You don't own Redbank you never owned Redbank we went to Anthony office previous and you confirmed this to Anthony with your Dad as a witness
Now value Lantona and make split Or tell me what properties belong to me in Lantona or offset with Beenleigh and 59 cook and give value for Lantona 25%
LOC refinanced your house and you have never made payment nor contributed interest since it was refinanced
Stop delaying and holding onto things that do not belong to you
Go get somebody that you know rather than me and do what I suggested:
you take agreement and explain your stuff to him when you have completed I will explain to him and then let this person watch and guide how to split that is fair as per our agreement since I don't want you to think I am biased in any way whatsoever
[104] There was then a further response from Jason at 2.43 pm on 6 April 2020 which included the following:[40]
We need to get a mediator as we should not be discussing this topic between each other any more. Are you organising one or should I . id much prefer if you did but I think I might know someone
[105] Habib relied upon "Correct, you own redbank" as constituting post-acquisition admissions from Jason and, where relevant, his assertion of ownership of Redbank as constituting prior consistent statements from Habib, to support his oral evidence at trial to the effect that the Mine Street properties had at all times been his, both legally and beneficially.
[106] In aid of his case, Habib also sought to generally attack the credit of Jason.
[107] He did so in relation to a sale transaction involving a property at 115 Main Greenswamp Road. It had been a property mentioned in the Family Agreement.
[108] A contract for the sale of this property, dated 24 March 2015, was put into evidence by Habib. It had been signed by Jason with a sale price of $575,000. A transfer document dated 8 May 2015 was then put into evidence by Habib. The transfer document recorded a consideration of $450,000. Finally, a settlement statement dated 1 June 2015 was put into evidence by Habib. That document recorded a contract price for the transaction as $450,000.
[109] I note on the transfer document that transfer duty had originally been recorded in typed numerals as being $18,000. Those typed numerals had then been crossed through and replaced with handwritten numerals $14,175. The $18,000 typed figure would have equated to a sale price of $575,000 for the property. The $14,175 figure equated to a sale price of $450,000.
[110] It was put to Jason by Habib that the true sale price had been the larger $575,000 figure rather than the $450,000 recorded on the transfer. It was put to Jason that the transfer document had, in effect, deliberately understated the consideration for the transaction. Jason's response to this was, in part, that he could not remember whether the contract which was produced in evidence was the ultimate contract for the property, or what the consideration for this property had been in mid-2015. Habib submitted that this transaction represented fraudulent conduct on the part of Jason. The submission was that Jason was, at least, seeking to defraud the Office of State Revenue in respect of transfer duty of $3,825 and Habib's wife, Moni, of $125,000. This property had been registered in the name of Moni, Habib's wife.
[111] I found these documents suspicious, particularly given the alteration made to the duty recorded on the transfer. Jason's answers on this issue were also suspicious. The reduction of a purchase price in the amount of $125,000 (being a reduction of approximately 21.74 per cent) for a property Jason was selling seems likely to be something a person such as Jason (that is, a property developer) would remember, even eight years after the event. Despite this, I note the finding sought is in respect of a collateral credit issue which was of a very serious nature, and which had not been a pleaded allegation. Although I hold suspicions, I cannot be satisfied on the evidence presented that there was the type of fraudulent conduct alleged in closing submissions against Jason to the degree contemplated by the Briginshaw[41] principle in respect of the application of the balance of probabilities.
[112] The second credit point raised was that Jason had intentionally put false and misleading information into a sworn affidavit which had been filed in support of his originating application, which later became the claim in this proceeding. In that affidavit, he had deposed that certain handwriting on a document was the defendant's when, in fact, it was not. The offending statement can be seen at paragraph [12] of the affidavit of Jason dated 24 October 2022.[42] It stated a belief that the handwriting was that of Habib because it was said to be familiar to Jason as he had seen it on many occasions.
[113] In cross-examination, Jason now accepted that that handwriting was, in fact, someone else's handwriting.[43]
[114] Again, this is a serious accusation and I am not satisfied on the evidence before the Court that there had been a deliberately false statement made by Jason at the time of his swearing of that affidavit.
[115] I accept Jason's explanation that he honestly believed at the time of swearing his affidavit that the handwriting had been Habib's but now accepted it was not.
[116] I note that the affidavit was not read and relied upon by Jason in his evidence-in-chief as being correct at the trial. In this way, Jason was not continuing to assert the handwriting was Habib's after the time he became aware that it was not.
[117] The third point of credit was an allegation that Jason had been inconsistent in his evidence as to the ownership of 47 Ellen Street, Oxley. In particular, paragraph [33] of Jason's affidavit was pointed to where Habib and his father were identified as the equal beneficial owners.
[118] I am satisfied in part with the evidence given by Jason on this issue. He identified that after the interactions constituted by the 8 July 2013 emails, he treated the 47 Ellen Street property as beneficially owned by Habib and his father Peter in equal shares. In effect, the differing articulation of ownership of that property was said to be explicable as they occurred at different points in time. In his evidence-in-chief, Jason maintained that he had owned 47 Ellen Street at its acquisition.[44] Part of his explanation was that the attached spreadsheet to the 8 July 2013 email had been executed.
[119] I accept that from about the time the spreadsheet was sent, Jason started to treat
47 Ellen Street as beneficially owned by Habib and his father, Peter. The likely reason for this was that the person who Jason seems to have respected was his father. I should note that Habib clearly shared that respect for his father.
[120] When the affidavit in question was sworn, I accept that Jason was prepared to accept the ownership of that property in a way which would recognise a 50 per cent beneficial interest in favour of his father and in favour of Habib. In those circumstances, I do not treat this part of the affidavit as having been falsely sworn.
[121] Despite my view of these three credit points, I find that there were other unsatisfactory aspects of Jason's evidence which did affect his credit. I will deal with these later in the reasons.
[122] It was noted by Jason that Habib's pleaded position was that there were four factors said to support the common intention:
(a) a purchase in the name of Habib and Jason;
(b) Habib being responsible solely for the payment of the deposit as well as the subsequent mortgage payments;
(c) Habib being responsible for the costs and expenses incurred for the maintenance and upkeep of the two properties; and
(d) the two properties being purchased in a one-half share in the name of Jason for tax minimisation and financial planning reasons.
[123] It was said by Jason that Habib's pleaded reference to "tax minimisation and financial planning reasons" was a euphemistic way of saying that Habib was going to dress up the ownership of the land so as to appear different to the true position, in order to defraud the ATO.
[124] Jason submitted that the Briginshaw[45] principle would apply to the extent such a finding was sought against him in respect of such allegations. It was submitted that the evidence did not come close to approaching the clear and certain proofs required for such a finding on the balance of probabilities.
[125] It was submitted that the common intention case must fail because in this case there was no such common intention present, and Habib had failed to discharge his onus to establish that he engaged in detrimental acts.
[126] It was noted that the first act of detrimental conduct was said by Habib to be Habib's paying of the deposit for the two properties. Jason submitted that the deposit for the two properties in the amount of $40,000 came from a trust account in his father's name, being Suncorp account number [XXX 8620], where the account was styled as his father as trustee for Rania, Maria, Jason, Jeremy, Christina and Rachel. That the payment came from this account was an admitted fact on the pleading.
[127] Jason gave evidence that this was one of the accounts to which members of the family pooled their money for the purposes of the Family Arrangement. Jason submitted that any payment from this account could not have been a detrimental act by Habib as it did not then solely represent Habib's money.
[128] Next, Jason submitted that there was no common intention that Habib had the 100 per cent beneficial interest in the two properties.
[129] In aid of that submission, Jason gave evidence at trial that there was a discussion on the way to an evening auction of the Mine Street properties to the effect that the properties would be owned jointly by them in equal shares. Jason gave evidence as follows:[46]
"Habib goes, look, we have both worked equally hard enough during this period when my parents were overseas. If we buy these properties we're going to buy them together in joint names fifty-fifty."
[130] I pause to note that this alleged conversation was not pleaded. It was, however, put to Habib in cross-examination, and he denied that it occurred.
[131] Habib denied that there was such an evening auction.
[132] Jason then went on in his evidence to say immediately after the auction on the same night he had a further conversation with Habib as follows:[47]
"All right. What happened at the auction?---At the - at - what - sorry. We were the highest bidders, but there was a reserve.
Okay. And did you do anything about buying the property after - or did the two - - -?---Yeah. So - - -
- - - of you do anything about it?---So as we looked into it and we were further negotiating with the agent, I - I kind of - you know, I noticed that the zone was residential C. And because it was Ipswich City Council, I wasn't really familiar with that zoning. It was different to Brisbane so that time I rang up an architect - Albert, AAD Design - just to query him about res C; what it means. And his response was, you know, it's the same as - back then I think it was called RB4 or LMR in Brisbane, meaning you can build medium density units up to three levels. And after that conversation, me and Habib had a conversation about it and thought, you know, maybe it is a good idea to buy and, you know, might have some future potential or future gain, being it's a - - -
All right. So just - - -?--- - - - development site.
- - - pausing there. After that, did you have any more discussions with the real estate agent about buying it or was that left to Habib?---Well, Habib and I were together, but Habib was - he was discussing with the real estate agent.
Is this still after the auction, is it?---This is after the auction. Yeah.
All right. And so you were there - - -?---It was actually that evening. It was at night.
That evening. You're quite right. That evening. So you were there, but Habib was doing the talking; is that right?---Habib was doing the talking. Correct.
All right. And do you remember what was said then?---Yeah. So - so I can't remember exactly what the price was under the hammer, but we paid a little bit extra to secure both properties."
[133] This evidence was broadly consistent with the case pleaded by Jason at paragraph [7C(c)] of the Answer to the Further Amended Counterclaim.
[134] Jason then gave evidence that there was no discussion with Habib about the possibility of him owning the Mine Street properties 100 per cent. I pause to note on this last factual issue that Habib had never suggested in his pleading or in his evidence that he had such a conversation.
[135] On balance, I find that it is more probable than not that there was some type of conversation whereby Habib told Jason that they were purchasing the Mine Street properties equally together.
[136] This would have been consistent with how the properties were actually purchased and how the transfer document, loan agreement from the CBA and mortgage to the CBA would have to be drafted. On the balance of probabilities, it is more likely that Habib would have informed Jason of this intended purchase before acquisition.
[137] At the time of the acquisitions, the family was still a tight-knit unit and there seems little reason why Habib would not have informed Jason of this information.
[138] Further, such a purchase would have been consistent with the Family Arrangement, which included the accrual of investment properties by various family members. It would be a natural thing for Habib to have raised the proposed acquisition with Jason prior to the actual purchase.
[139] Jason gave evidence in the AAT Proceeding that he was aware that the Mine Street properties were acquired on a 50/50 basis. His evidence in the AAT on this issue can be contrasted to his evidence he gave on that occasion about a different property, namely, 99 Oldfield Road, Sinnamon Park.
[140] In his sworn statement, Jason stated as follows in respect of the Mine Street properties:
"These properties were financed by CBA home loan account no. [XXX 3208] for approximately $100,000... A copy of a bank statement is attached to this statement and marked 'JH-4'. The balance of finance came from Suncorp Family Trust account number [XXX 7620]."
[141] Jason's oral evidence at the AAT Proceeding showed a real distinction between his knowledge of the Mine Street properties and the 99 Oldfield Road property as follows:[48]
"Yes. In 2002 you purchased, with your brother, a place at 7 Mine Street - - - ?---A house, 7 and 9 Mine Street.
And you rented those out; is that right?---Habib - Habib purchased them in joint names. Habib used to handle those properties. Yes.
What about Oldfield Road, Sinnamon - - - ?---I don't - I don't - I don't comment on that. I just - I don't know nothing about that house. Apparently my name was in the house but I don't remember, I don't recall. Was my name in the house? I can't, yes. I don't remember and I don't recall. Habib used to handle our financial affairs back then. If he tells me to sign I used to sign."
[142] No corroborating evidence was led by either party as to the exact circumstances of the occasion of the purchase of the Mine Street properties. I am cautious in accepting either Habib or Jason's evidence on this issue beyond my finding that, on the balance of probabilities, Habib told Jason, prior to the acquisition of the Mine Street properties, that the properties were to be purchased by them equally.
[143] I turn then to the alternative argument advanced by Jason on the common intention issue. It was to the effect that even if Jason's evidence of a positive conversation on this issue was not accepted, Habib in any event did not advance a case that there was some positive communication between them that Habib was acquiring 100 per cent of this beneficial item for himself.
[144] Jason submitted that the common intention advanced by Habib was said to be inferred from the following matters:
(a) was financially reliant on the defendant;
(b) had no financial means to fund payment of the purchase price for the Mine Street properties; and
(c) who was undertaking a vocational training course at TAFE Queensland.
[145] The deposit for the Mine Street properties was paid entirely by Habib and not paid for or contributed to by Jason.
[146] In response to the case advanced by Habib, and as referred to above, Jason pointed out that no positive conversation was pleaded or relied upon by Habib to the effect that Habib was to own the whole of the identified interest in the Mine Street properties.
[147] Jason noted that in paragraph [7(e)(ia)(a)] of the Answer to the Further Amended Counterclaim, he had pleaded:
"...(a) at no time during late 2002 or early 2003 did the Plaintiff and the Defendant have a discussion, either verbally or in writing, during which it was expressly stated that:
[148] That allegation was admitted in paragraph 5(c)(i) of Habib's Amended Reply to Answer.
[149] Further, Jason gave evidence at trial as to the existence of the Family Arrangement and that the business of Farmer Charlie's had been owned equally by Habib, Marina and himself.
[150] In relation to the latter, Jason gave evidence that he did work in the fruit shop from which the Farmer Charlie's business was conducted. He gave evidence that his work at Farmer Charlie's varied over the years. For example, he gave evidence that he went to TAFE for a couple of months, but that was at nighttime. There was also evidence that in the later years of the Farmer Charlie's business he worked as a carpenter.
[151] Jason identified that in addition to Habib and himself, at different times his sister, Marina, his father and his mother worked there as well. He gave evidence that how much work he might undertake would vary from week to week. He said some days it was seven days a week. Some days it was three. Some days it was five. He said that they all lived under the same roof.
[152] In relation to the Family Arrangement, Jason gave evidence of his understanding of it. He said that it was "...back when we owned a fruit shop [being a reference to Farmer Charlie's]." He relevantly stated:[49]
"You know, it was a family business run by brother, myself, my parents and all the profits and proceeded[50] from the shop, we used to utilise that money to buy property, basically."
[153] Under cross-examination, Jason maintained that he had made a payment for each of the Mine Street properties via the Family Arrangement. He gave evidence that the deposit had come out of the Suncorp account number [XXX 8620], which he referred to as his father's trust account, into which proceeds from the Farmer Charlie's business had been paid. He maintained that he was a partner in Farmer Charlie's, so part of the money that had gone into the trust account had, therefore, come from him.
[154] Jason had also given evidence that he had regarded 47 Ellen Street and 64 Tarragindi Road to be his properties up until around 8 July 2013.[51] He referred to the spreadsheet which had been attached to the email of 8 July 2013. Jason said that the spreadsheet had, in fact, been signed in the room next to his father's kitchen. Jason gave evidence that he, his father and Habib were present and signed the document. He noted that in relation to 47 Ellen Street that he was the sole registered proprietor, and he believed up until signing this document that it was owned by him, but after the document had been signed, he believed that Habib and his father, Peter, were the 50 per cent owners.
[155] Obviously that was a reference to them each being 50 per cent beneficial owners.
[156] Jason gave this as his explanation for why in paragraph [33] of his affidavit he had identified this as the beneficial ownership position. Jason submitted that the table at paragraph [33] of the affidavit effectively reflected the spreadsheet which he said he had signed in July 2013. Up until signing that document, he said he regarded 47 Ellen Street as his property.
[157] I note that it was no part of the pleaded case of Jason that this 8 July 2013 spreadsheet had been signed and legally operated to alter property interests. The sending of the spreadsheet had been pleaded by Jason but not its execution.
[158] I find that Habib has not proved that there was a common intention of Habib and Jason that Jason held his 50 per cent interest in the Mine Street properties beneficially for Habib.
[159] In making this finding, I will first make some general findings as to credibility of Habib and Jason, and then will move to the more specific findings which support the conclusion that I have set out above.
(b) Observations as to the general credit of Habib and Jason
[160] During this trial, both Habib and Jason at various times were emotional and argumentative. Throughout the trial, I had to request one or both parties to stop yelling or otherwise engaging in inappropriate argumentative conduct.
[161] On balance, Habib engaged in this conduct more often, but to be fair to Habib, he was self-represented and was conducting his own case, including cross-examination and, accordingly, had more opportunities to express these objectionable behaviours.
[162] Habib would regularly fail to answer questions directly and would often be argumentative in his responses. At times, Jason would engage in similar non-responsive answers posed to him by Habib.
[163] As I have already summarised from portions of the evidence, these two brothers had fallen out at least by 2019 and both seemed incapable of speaking civilly to the other. Their dislike for each other appeared genuine.
[164] In relation to Habib, his credibility was irretrievably damaged by the fact that the overall effect of his pleaded case and his oral evidence presented to the Court at trial necessarily carried with it the premise that in the 2000s he had deliberately structured false appearances as to who owned the Farmer Charlie's business, and as to who owned various pieces of real property, including the Mine Street properties. His case necessarily involved the proposition that the maintaining of these purported false positions was done for tax purposes and asset protection purposes.
[165] I accept the submission by Jason that the reference to being for tax purposes and asset protection purposes was a euphemistic way of identifying that Habib was now asserting that he had falsely presented the ownership of the Farmer Charlie's business and the various real properties to the larger world in order to deceive the ATO so as to evade paying his lawful tax obligations and to deceive unsecured creditors who might in the future have had lawful claims against him which could then be sought to be recovered by way of execution over the assets of the business or the pieces of real property.
[166] Added to this position is the fact that for Habib to be believed on his current evidence in this proceeding, I would have to find that he engaged in giving intentionally false evidence before the AAT in the AAT Proceeding in 2013.
[167] Habib therefore comes to this Court and contends that this Court should now believe his most recent sworn evidence over his evidence from the AAT Proceeding.
[168] If I reject this contention, it means that I can only conclude that he has given false evidence on material issues at this trial. The position is stark.
[169] This situation must necessarily result in Habib's credibility being irretrievably damaged.
[170] Quite apart from this, Habib at times gave evidence which was unsatisfactory in other ways.
[171] At one stage, Habib gave evidence that he made the final payment on 4 May 2005 for the mortgages over the Mine Street properties from a particular NAB account number [XXX 8847], by way of monies said to be sourced from a business known as W. Arkell & Sons.
[172] Habib was challenged on this evidence in cross-examination. When it was suggested that Habib had not acquired the business in W. Arkell & Sons until a later date, Habib then said that he had been trying out that business without having purchased it and that the monies had therefore come from when he was trying out the W. Arkell & Sons business. No contemporaneous documents were produced to corroborate this material change in the story by Habib. It was an example of how he was prepared to mould his evidence to best suit his case.
[173] When he was further challenged on this evidence, he progressively suggested the money came from different sources. Eventually, he fell back on the simple assertion that it was Habib's money. I will revisit this evidence later in these reasons in more detail.
[174] I treat with great caution the oral evidence given by Habib in this proceeding, unless corroborated by contemporaneous documents, which I otherwise accept to be accurate. Having said this, merely because I do not accept Habib's evidence on certain matters does not mean that I must reject Habib's evidence on other matters.
[175] Jason's oral evidence did not suffer from the irretrievable problems which the evidence of Habib faced. However, there were still some unsatisfactory aspects of his evidence.
[176] An example can be seen in one of the matters which I have already touched upon. The spreadsheet which had been attached to the 8 July 2013 email chain had been formulated by Habib in a meeting with their father. At trial, Jason gave evidence that he, Habib and their father had executed the attachment to that email on the occasion of a meeting which occurred in a room next to their father's kitchen.
[177] That attachment purported to be a declaration by each of the three persons as to the property ownership of Habib, Jason and their father in respect of real properties, as at the date of its execution.
[178] Nowhere in Jason's pleadings is it alleged that the attachment was executed by all three parties, nor is it alleged that it had become operative in its terms.[52]
[179] The spreadsheet is referred to by Jason in his pleadings[53], but simply to provide the context of it having been sent by Habib. The failure by Jason to have raised its execution prior to his having given evidence, in my view, supports a finding that the document was, in fact, never executed.
[180] The fact that Jason says that the only written copy of the executed attachment was in the possession of Habib does not support a different conclusion. Merely because a party does not have a copy of an executed instrument does not change the fact that the instrument itself was always executed and enforceable as such.
[181] In the circumstances, this is an example of where I do not accept the evidence of Jason. I find that the instrument was not executed between the parties.
[182] This is not to say that the spreadsheet may not have held an influence on Jason. As previously observed on this issue, it was evident that the only person the two brothers seemed to have mutually respected was their father, albeit neither of the brothers were prepared to call their father as a witness in the trial. I do not doubt that the promulgation of this spreadsheet with their father's imprimatur would have carried weight for both Habib and Jason. Jason subsequently treated the property as being held on trust for Habib and his father, Peter.
[183] Another example which has been touched upon is Jason's evidence to the effect that, on the way to the alleged auction for the Mine Street properties, he had a positive conversation with Habib to the effect that because they had both worked hard they would both acquire the Mine Street properties on a 50/50 basis. That conversation was put to Habib during the trial, and Habib denied it. However, that conversation was never pleaded by Jason. The pleadings went through a whole series of amendments over time. Each side pleaded out the basis for their versions of what the common intention was. On Jason's side, the common intention was that they would have a 50/50 interest in the Mine Street properties. However, this purported pre-auction conversation never featured in the pleadings at any stage as a fact from which the intention was to inferred. No evidence was led that this alleged conversation had been raised prior to it being put to Habib in cross-examination at the trial.
[184] In circumstances where the issue of common intention was always front and centre in this litigation, the absence of a pleading reflecting this conversation supports a finding that this specific conversation did not occur in the fashion articulated by Jason.
[185] The third example was in relation to a conversation said to have occurred when Habib proposed the written Family Agreement. It was said that between when the draft of the Family Agreement was sent to Jason and it's execution, Jason had a telephone call with Habib. Jason's evidence was that on that occasion he raised with Habib the reference to the words, "HPH properties accumulated". Jason gave evidence that in that conversation he challenged Habib about those words as follows:[54]
"...what was said[?][55] - it refers - because the 64 Tarragindi Road, 7 and 9 Mine Street were as security in that line of credit facility and they paid out the original debt on 64 Tarragindi Road, Habib was concerned about if I didn't honour my end of the agreement and you know, do the monthly instalments, or take over the line of credit facility, then he'll be liable for that full amount - the $700,000 as in that agreement - the 1.3 million and the $700,000 split. So therefore, those properties become his. This was Habib's interpre-terpretation when he interpreted to me.
All right. Did you say anything in response to that?---No."
[186] I asked the counsel for Jason whether this alleged conversation with Habib had been put to Habib. The counsel for Jason identified that it had not.
[187] Again, the potential importance of the conversation and the occasion of it having occurred would ordinarily have been a matter which would have featured in the pleadings, and certainly is a matter which should have been put to Habib. The fact that it had not either been pleaded or put to Habib supports the inference that this was again an occasion where Jason was giving evidence which simply favoured himself, rather than giving accurate evidence of what occurred. I do not accept Jason's evidence in respect of this matter.
[188] These three examples illustrate that caution also must be shown in relation to accepting oral evidence from Jason. As with Habib's evidence, merely because I did not accept Jason's evidence on certain issues does not mean that I do not accept it on other issues.
[189] In short, both Habib and Jason were not good witnesses, and both of their credit was adversely affected at trial.
(c) Additional findings and conclusion on the first real issue
[190] I have concluded that there was a common intention that the Mine Street properties were to be held in equal shares by Habib and Jason both beneficially and legally.
[191] First, I am satisfied that in the relevant period between 2000 to 2006, the Habchi family was a close-knit group where they were prepared to operate as a group for the betterment of individual members of the family.
[192] Secondly, for at least the financial years ending 2002, 2003, 2004 and 2005, each of Habib, Jason and Marina signed tax returns which were consistent with each of them holding a legal and beneficial one-third interest in Farmer Charlie's. In doing so, the taxable income from that business was distributed amongst them on an equal basis. There was a sound logical reason for members of such a close family group to do so. This allowed them to organise their affairs so as to seek to minimise income tax. The sworn evidence given by Habib in the AAT Proceeding is that this reflected the true ownership position. The statement of facts submitted by the larger Habchi family in the AAT Proceeding, including Habib, Marina and Jason, unambiguously asserted that this reflected the true position. I find that this sound, logical and lawful method of tax minimisation did, during at least 2002 to 2005 reflect the true position.
[193] I am not persuaded by the oral evidence of Habib at this trial to the contrary. I do not accept that the Farmer Charlie's business was at all times during 2001 into the start of 2006 fully owned beneficially by him.
[194] No doubt Habib was the eldest son and had a large part of the day-to-day control of the finances of Farmer Charlie's, but that does not equate to beneficial ownership of the business.
[195] I am satisfied that Marina and Jason, their mother and father, at various times worked within Farmer Charlie's business. That is entirely consistent with the family operating for the greater good of the family. I do not accept the oral evidence of Habib that he was the only one who worked within the business. Given the close family arrangement which existed during that period, it is more probable that most of the family members at times worked within the partnership business. The fact that Peter Habchi and his wife were in receipt of pensions at that time does not alter my view.
[196] I accept Jason's evidence that sometimes he worked full time within that business, but at other times he carried out lesser work, sometimes five days a week, sometimes three days, sometimes not at all. No doubt as Jason became more engaged with his work as a carpenter, there were periods where he did not perform any work within Farmer Charlie's at all, particularly from 2003 onwards. That is consistent with the evidence which Jason gave in the AAT Proceeding.
[197] Regardless of how much actual physical work Jason undertook within the Farmer Charlie's business at particular points in time, if the partnership business was owned in equal shares between himself, Habib and Marina, then the income from the partnership business would have been owned legally and beneficially in one-third shares, in any event.
[198] The proposition that Habib was the sole person from his family working within Farmer Charlie's for the entire relevant period is implausible and I reject it.
[199] The conclusion which I have reached on this factual issue is consistent with the sworn evidence which Habib gave in the AAT proceeding. I favour the sworn evidence given in the AAT proceeding over the sworn evidence given by Habib in this trial on this issue. The AAT evidence was consistent with the tax returns which had been filed by Habib, Marina and Jason was consistent with the Statement of Facts relied upon in the AAT proceeding, and was a logical method for the family to legally minimise tax. On this factual issue, I favour Jason's evidence at trial over Habib's.
[200] Thirdly, I find that the Family Arrangement existed and operated during at least 2000 into the start of 2006. The sworn evidence of Habib and the Statement of Facts from the AAT Proceeding were to the effect that monies were pooled by various family members which would then be used to allow family members to acquire, both legal and beneficial interests in properties.
[201] Various accounts were used as part of the Family Arrangement. These accounts were specifically identified by Habib in the AAT Proceeding in the Statement of Facts. He had read and authorised that Statement of Facts. He also gave consistent evidence on this topic in the AAT Proceeding. One of these accounts was the Suncorp account number [XXX 8620], and one of these accounts was the NAB account number [XXX 8847].
[202] Both in the Statement of Facts and in his evidence at the AAT Proceeding, Habib effectively identified the existence and operation of the "Family Arrangement". Habib identified that, in part, this was to ensure that younger members of the family could have opportunities to acquire properties in addition to the older members of the family.
[203] Such an arrangement is one which was logical, given the then close-knit nature of this family.
[204] Fourthly, I find that Habib has not discharged his onus of proof to demonstrate that there was a common intention at the time of acquisition of the Mine Street properties that Jason was to hold his 50 per cent interest beneficially for Habib.
[205] The evidence of Habib and Jason at the AAT Proceeding was consistent with each of Habib and Jason believing that each had a 50 per cent interest in the Mine Street properties. At no stage in the Statement of Facts or in their sworn evidence was there any suggestion of the proposition now put forward by Habib that there was a common intention for Jason to hold his legal 50 per cent interest in the Mine Street properties beneficially for Habib. The ATO asset betterment document[56] recorded Habib as having only a 50 per cent interest in the Mine Street properties as an asset and as having only 50 per cent of the CBA mortgage loan liability for the Mine Street properties in 2003 at the time of acquisition. Habib and Jason, by their sworn witness statements in the AAT Proceeding, had sought to correct inaccuracies in the ATO's asset betterment analysis. The legal and beneficial ownership of the Mine Street properties was not sought to be corrected in the AAT Proceedings by either of the brothers in their written statements.
[206] As I have set out above, I do not accept that there was the particular positive conversation on the way to the auction for the Mine Street properties between Jason and Habib which occurred as alleged by Jason.
[207] However, I do accept that on the balance of probabilities that Habib told Jason prior to the acquisition that the Mine Street properties were going to be purchased in equal 50 per cent interests between them. That such a conversation likely occurred is consistent with:
(a) the then close-knit nature of the family;
(b) that Jason at the AAT Proceeding positively gave evidence of his knowledge of their equal interest, in contrast to the Oldfield Street property which he identified he did not have a recollection of;
(c) the Family Arrangement was in existence, so there would have been no reason not to tell Jason; and
(d) Jason was going to be asked to sign a transfer document, a loan agreement and a mortgage, where the existence of such prospective requirements would have made it more likely that Habib would have told Jason of the potential purpose.
[208] Jason had pleaded that a discussion had taken place after the alleged auction which was consistent with the likely discussion I have found. However, as neither party led evidence to corroborate the exact circumstances of the occasion of the purchase, I am reluctant to accept the totality of Jason's evidence of this alleged discussion beyond the finding I set out above.
[209] Even if I were incorrect on whether there was such a discussion before the acquisition, I find that there was no conversation where Habib told Jason that Jason's 50 per cent interest was beneficially to be held for Habib. Habib did not suggest that such a conversation occurred.
[210] In the absence of such a conversation, and where the Family Arrangement existed, it is entirely logical that Jason would have believed that the Mine Street properties were being acquired by the two brothers in equal 50 per cent interests, both legally and beneficially. Habib was approximately 29 years old whereas Jason was approximately 22 years old. Habib may have been the older brother, but he was the older brother within a close-knit family relationship where they were pooling money into various accounts for the benefit of the larger family. The fact that other properties were purchased in Jason's name, including one in 2000, does not change my view on this finding. Those purchases were also consistent with the existence and operation of the Family Arrangement.
[211] Fifthly, in accepting that the Family Arrangement existed and operated in the way explained in the AAT Proceeding for the period 2000 into 2006, I reject the evidence of Habib in this trial that the Family Arrangement never existed. This is directly contrary to the effect of the evidence Habib gave in the AAT Proceeding. I reject Habib's evidence in this trial that the arrangement which in truth existed was the "Habib Arrangement". His "Habib Arrangement" was simply, in effect, that he always owned everything and that any documents or registered interests which indicated to the contrary were just façades necessarily designed to conceal the real beneficial ownership of assets which were always his.
[212] In accepting the existence of the Family Arrangement and the three way ownership of Farmer Charlie's, I also accept that the Suncorp account number [XXX 8620] included the pooling of income from each of Habib, Marina and Jason from Farmer Charlie's. I find that the deposit of $40,000 for the Mine Street properties was paid out from the Suncorp account number [XXX 8620] and this was a payment made consistent with the Family Arrangement. That the $40,000 came from this account was an admitted fact.
[213] Even though Habib was not named as a beneficiary of this account, Jason does not suggest that the payment was not made for the joint benefit of both himself and Habib. I accept that the payment was made to both of them jointly as part of the Family Arrangement. Part of the Family Arrangement was that the monies were repayable by them.
[214] The payment of the $40,000 deposit therefore can be seen as a joint contribution on behalf of both Jason and Habib for the purchase price of the Mine Street properties.
[215] Sixthly, and in addition, both Jason and Habib jointly paid the residual purchase price by taking out a CBA loan. They were both personally liable on the loan and were both mortgagors under registered mortgages over the Mine Street properties.
[216] Habib submitted that this was only necessary because Jason was registered on the title. I reject that proposition. I regard Jason's status as a joint borrower of the money and a joint mortgagor as substantively reflecting that Jason was making an equal contribution to the purchase price of the property. It was consistent with Jason having a then intention to hold his 50 per cent interest in the Mine Street properties both legally and beneficially.
[217] Seventhly, Habib submitted that he was solely responsible for the subsequent mortgage repayments. Habib did not discharge his onus on this factual assertion. This would have required a detailed presentation of evidence which supported this assertion. That was not undertaken by Habib. Where I have found that the Family Arrangement existed, the more probable inference is that any repayments would have been made from rental obtained from the properties and otherwise pursuant to the Family Arrangement. I do not accept Habib's oral evidence to the contrary.
[218] Eighthly, the mortgage was subsequently repaid in full by a payment of $90,168.27 from funds held in the NAB account number [8847]. That particular account was held in the names of the Habib, Moni (Habib's wife), Rania and Marina. Habib had given evidence at this trial that the monies in that account had been solely contributed by him, and those monies were solely his monies. Jason's evidence was that those monies were part of the Family Arrangement. I accept Jason's evidence on this factual issue.
[219] The starting point for the issue is Habib's evidence-in-chief at this trial. Habib had said the monies for this account had come from his business, W. Arkell & Sons.
[220] I then note that in the AAT Proceeding, Habib had given sworn evidence that the NAB account [8847], when it was initially set up in 2005, was a clearing account. He gave evidence as follows:[57]
"What we did, your Honour, when we first bought the property, I think, most of the property we bought is one in 2001, one in 2002, one in 2003, something like that and they were all individually loans from ING bank, from a Commonwealth Bank, every loan was individually borrowed. What we did in, I think it was 2005 or 2006 when this 8847 account showed up we refinanced and got a line of credit on a number of the properties. So do you want to keep this or ds..."
[221] Later on as part of the questioning, the Senior Member in the AAT Proceeding asked Habib:[58]
"So your only source of income prior to - in the period up to 2006 was effectively Farmer Charlie's?"
"Farmer Charlie's, correct, and those minor things we talked about with the Fruit Direct credit card."
[223] Then Habib was asked about 2006 through to 2008, and his answer was:[60]
[224] Habib's evidence-in-chief in this trial included that the W. Arkell & Sons business had been purchased in 2005 or 2006.
[225] Then in cross-examination at trial, Habib accepted that he did not purchase W. Arkell & Sons until 2006.[61] In the cross-examination he described the 2006 purchase as a "physical purchase", but stated that he owned it before; that is, tried it out for approximately six months. It was then put to Habib that if it had not been purchased until 2006, the earliest that he could have "owned it" was in July 2005, which Habib agreed with.
[226] Habib then adopted as an explanation for the money in NAB account number [XXX 8847] that it was sourced from a separate apple export business which he had been involved in from 2003. He said that he made cash deposits from that business into the account. I accept that Habib did have an involvement with a fruit export business from 2003. However, Habib seems to have been an agent for a British entity known as "Fruit Direct". Fruit Direct was owned by a third party. To the extent Habib was receiving bundles of money in that business in respect of fruit exports, those bundles were not evidently wholly his money at the relevant time. Habib did not establish exactly what he earned from the Fruit Direct business. Habib tendered a series of cheque butts said to be associated with NAB account number [XXX 8847]. The cheque butts did not prove what the ultimate source of the funds in the account was. I was not prepared to accept Habib's oral explanations given in respect of the cheque butts and the source of the monies in the NAB account number [XXX 8847].
[227] Under further cross-examination at trial, Habib then offered a further explanation for the source of funds in NAB account number [XXX 8847] used to pay out the mortgages as follows:[62]
"HIS HONOUR: You're being asked what was the source - - -?---The source was - - -
- - - of that money?--- - - - was - the source was either W Arkell and Sons, if it was a little bit later or not. That specific point in time where there's W Arkell and Sons, there's the Fruit Direct business and there's the facilities that I've got with the NAB Bank.
MR FERRETT: You had facilities with the NAB - - -?---Correct.
- - - that you might have drawn on at that time?---Correct.
All right. That's the first time - - -?---So they're all linked together.
- - - we're hearing about that, isn't it?---Well, that's the first time you've actually asked me about that. But I think if you go through the transcripts, it's all in there.
Well, you would accept - do you accept then that it wasn't the Fruit Direct business from which you got that money?---Well, I'll have to look into it more deeper to be specific about - - -
Why did you say if you weren't sure - - -?---It's Habib.
- - - that it did come - - -?---Habib. Habib has done - - -"
[228] I do not accept Habib's evidence that the money paid from NAB account number [XXX 8847] on 4 May 2005 ought to be treated as being solely his money. This bank account was identified in the AAT Proceeding as being an account used as part of the Family Arrangement. Habib had given evidence in the AAT Proceeding to the effect that there had been some refinancing of existing properties prior to 2006, which allowed monies to be fed into this account but predominantly Farmer Charlie's remained the main source of income up to and including 2005.
[229] At this trial, Habib denied, when it was put to him, that the real position was that the proceeds for that account had come from the family pooling of funds.
[230] Ultimately, Habib has not satisfied me that the payout of the debt secured by the mortgages had come from funds which were separate to the Family Arrangement, which I accept existed and was operating as at 4 May 2005. He has not discharged his onus that the 4 May 2005 payment was one solely made for his benefit.
[231] Further, on the balance of probability, I find that as at 4 May 2005, pursuant to the Family Arrangement, the payment from the NAB account number [XXX 8847] was made for the equal benefit of Habib and Jason.
[232] This finding was consistent with the NAB account number [XXX 8847] being identified in the Statement of Facts in the AAT Proceeding as being an account used as part of the Family Arrangement.
[233] Ninthly, my conclusion on this is not altered by the purported prior consistent statements of Habib or the purported admissions by Jason.
[234] I have previously outlined the evidence Habib has sought to rely on as his prior consistent statements or as admissions by Jason to the effect that Habib owned the full legal and beneficial interests in the Mine Street properties. They are:
(a) the "HPH accumulated properties" in the Family Agreement;
(b) the statements in the 3 February 2019 chain of communication;
(c) the statements in the 25-26 June 2019 chain of communication;
(d) the statements in the 21 August 2019 chain of communication;
(e) the statements in the 28-29 August 2019 chain of communication; and
(f) the statements in the 6 April 2020 chain of communication;
[235] These communications do not alter my view for the following reasons.
[236] The starting point is to recognise that there were some other communications which were consistent with Jason having the beneficial ownership of his 50 per cent interest in the Mine Street properties.
[237] On 8 July 2013, Habib generated the spreadsheet which recorded Jason as holding both a legal and beneficial interest in the Mine Street properties at a 50 per cent level. Habib gave evidence that this represented a gift of that interest by him to Jason. I acknowledge that there were other interests in that spreadsheet which did not reflect the then registered title of other properties. Further, the covering email and the spreadsheet provided for the declaration of the interests as part of a larger agreement about Jayhab Developments Pty Ltd and the apportionment of debt under an existing line of credit. It, at most, reflects some preparedness to have properties declared by Habib to be owned by Jason under certain conditions.
[238] Next is Jason's 6 April 2020 email sent at 1.17 pm, where he effectively maintained that he owned his 50 per cent share in the Mine Street properties, albeit, Habib then responded, "You do not own Redbank", and Jason then counter responded, "Correct you own Redbank". Putting aside the subsequent response which I will return to later, the initial communication by Jason was consistent with the position he contends for at trial.
[239] The more important issue is the context in which the various communications relied upon by Habib occurred.
[240] There had been a close-knit family. The family had subsequently become a divided one due to a number of circumstances. One of those circumstances was that after 2008, the ATO started investigating the affairs of the family. At about this time, Habib resided outside Australia for a number of years.
[241] I am satisfied that during the absence of Habib, Jason was having to deal with a number of financial issues which the family was facing. This included the funding of legal costs associated with the ATO investigation.
[242] It also included specific liabilities associated with Habib.
[243] There is evidence that Jason had to pay off SPER[63] debts attributable to Habib or vehicles linked to Habib in an amount which exceeded $20,000. There was evidence that this occurred in 2013. The SPER debts had resulted in statutory charges being imposed over Habib's interests in the Mine Street properties.
[244] There was also evidence that Jason was arranging for payments to be made for child support on behalf of Habib.
[245] Habib had been the older brother in the family and, prior to leaving for Lebanon in 2008, he had been the dominant personality. In his absence, it seems Jason had taken on a more prominent role in the family.
[246] As the family participated in the ATO dispute and AAT Proceeding during 2013, it appears that Habib again started to reassert his dominant role within the family group.
[247] I find that as part of Habib seeking to re-establish his dominant position, he was seeking to assert a claim to as much of the property as possible that had been acquired via the Family Arrangement.
[248] Contextually, this included by way of the promulgation of the spreadsheet on 8 July 2013 and later the Family Agreement on 30 September 2014. Habib had drafted (or caused to be drafted) both of those documents.
[249] I find on the balance of probabilities that this is the explanation for the statement that Habib had "accumulated" all of the properties identified in the Family Agreement. I am satisfied for the Mine Street properties, that although the Family Agreement contained a statement asserting that the Mine Street properties were accumulated by Habib, that this statement did not reflect the true position, but rather it represented Habib having sought to assert ownership over as much property as possible.
[250] Jason gave evidence to the effect that, after having received the draft Family Agreement, he spoke to Habib, and received the explanation that I have previously set out. I have not accepted that evidence by Jason.
[251] However, I am nonetheless satisfied that Jason was content to sign the Family Agreement irrespective of the articulation of Habib's accumulation of properties.
[252] The Family Agreement gave Jason full control of all the properties in order to meet certain debts he had incurred or would incur for the purposes of the Settlement Deed. I am satisfied that the assertion by Habib in the document that he had accumulated the properties would not have been of present concern to Jason. Neither party contended in this proceeding that the Family Agreement operated to alter any proprietary interests which were actually held.
[253] There is a larger reason why I accept that Jason would have signed the Family Agreement, irrespective of the statement that Habib had accumulated the properties identified. That explanation was given in respect to Jason's evidence touching on later communications.
[254] Jason gave evidence relevant to the exchange which occurred on 6 April 2020 where he responded to Habib's statement, "You don't own Redbank" with the statement "Correct, you own Redbank". It was as follows:[64]
"Now, can you tell us why you said that?---May - at that - that - well, these emails come off the back of threats - off the back of being tormented for 10 years by him; off the back of being manipulated by 10 years - by him; off the back of - you know, doing everything for him. And it's the same - you know, I just want to end whatever relationship we have together. I just want it to be over with. That's it.
All right?---And I've tried for so many years. I've tried to get mediators involved, tried to get family involved, and this is the last resort."
[255] In a similar fashion, in the context of Jason's 21 August 2020 text at 5.07pm, where he had written to Habib, "Take red back and shed and also take Beenleigh. Your shed has free title and so does red back", Jason explained as follows:[65]
"All right. Now, you were asking him to please refinance the LOC and you said "Take Redback" which means Redbank, correct?---Yeah.
And you correct that the next one down. Can you tell us the circumstances in which those messages were sent?---Yeah. So these messages, they come from a - you know, just a long line of threats and being tormented. You know, and at that time, you know, my wife just goes, just get him out of your life. You know, he's threatened to execute my kids' heads - chop their heads off. Just nasty threats. Bashing on my door at 10 o'clock at night. You know, threatening me and my family, waking up my kids. And she goes, just get him out of your life. If - if - if that's what it - if that's what it's going to take, just - we don't want him around any more."
[256] The emails and text messages between Habib and Jason in 2019 and 2020 which I have set out previously illustrate a level of abusive and bullying language by Habib.
[257] There are other such bullying and abusive communications at later dates which further corroborate Jason's evidence of the reason for his desire to separate himself from Habib. In particular, I refer to:
[258] A text message chain on 26 November 2020 between the brothers, which included the following:[66]
Habib: "You resign today or I will execute your head off"
Jason: "No. And you can't do what you said you are going to do. Then I will sell up."
Jason: "You have really crossed the line by threatening my children."
Jason: "Don't make this personal. Enough with the threats. Go do what you said you were going to do from 6 months ago."
And stop lying to yourself and trying to convince yourself you are doing right"
Habib: "You are doing wrong and soon you will regret"
[259] An email from Habib on 10 December 2020, where Habib says to Jason:
[260] I note that the November 2020 text chain came after the 21 August 2020 email chain. It is unclear if similar threats to those made in the November 2020 texts had been made orally prior to the August 2020 emails. There was no real examination of this point.
[261] Regardless of whether Jason was conflating the subsequent texts with the August 2020 email events, I am nonetheless satisfied that Jason wanted Habib out of his life when the August 2020 email chain occurred.
[262] I accept that within the large amount of communications which were tendered into evidence that there were periods in 2019 and 2020 when the brothers were able to be civil with each other, albeit not in an overly friendly fashion. That such communications existed at certain periods does not change my overall assessment that Habib was a person with a forceful personality who was trying to reassert dominance over Jason from 2013 onwards.
[263] The sense which I have drawn from the various documents which were tendered, was that Habib did periodically but repeatedly seek by expressions of aggressive and bullying language to better his position.
[264] When Habib was taken to the 26 November 2020 entries that I have referred to above, and in particular the first communication being "Resign today or I'll execute your head off", Habib laughed in the witness box. He was then asked whether he found that funny, to which he responded:[67]
"...No, I don't find that funny, but you know, people get frustrated. It doesn't mean, you - you know - - -
What, and then they laugh about executing someone's head off?---No, I thought this was going to come up sooner or later.
Well, you knew it was going to come up because it demonstrates something about you, don't you?---I've got a - I've got - the police has put a domestic violence order on me."
[265] He was taken to the further text exchanges in the relevant chain of texts and then the questioning continued:[68]
"You're proud of that?---I'm not proud of anything. I'm frustrated. There's a reason why I'm saying that.
There's a reason why you're saying that?---It's - and you know, when you put a kettle on the stove, eventually the water boils - - -
There's a point - - -?--- - - - and what's going on is I'm boiling on the inside because my brother's stealing my properties.
And there's a point at which it's okay to make death threats against him and his family. Is that what you're saying?---Well, if you keep on reading the texts - - -
Oh, it gets better, does it?---Yeah, yeah, yeah, yeah."
[266] There was at the time and still is a larger dispute between Jason and Habib about the performance of the Family Agreement. This proceeding is not the vehicle to resolve that dispute. It may well turn out to be the case that Habib had a substantive reason to be angry at Jason in respect of breaches of the Family Agreement. Accepting that was a real possibility, it does not alter my overall assessment of the dynamic between Habib and Jason over time.
[267] I accept Jason's evidence to the effect that he would acquiesce or agree to positions put forward by his brother Habib at relevant times, because he simply wanted to move forward or wanted him out of his life. I accept that this was, in part, as a result of Habib seeking to reassert his dominance in the family in a way which most advantaged himself. When Habib did not achieve what he believed he was entitled to, his default position was to revert to a bullying and aggressive posture with a view to achieving a position which would most favour himself.
[268] For the above reasons, I do not treat the passages relied upon by Habib as admissions by Jason that he had a common intention to hold his 50 per cent interest in the Mine Street properties beneficial for Habib. While there are prior statements by Habib consistent with his case advanced at trial, they do not alter my view that his contended for common intention should be rejected.
[269] In conclusion, for the above reasons, I am satisfied that Habib has not made out the common intention that he has pleaded in the counterclaim that Jason was to hold his 50 per cent interest in the Mine Street properties for Habib.
[270] Further, I am satisfied that the true intention of both Habib and Jason at the time of the acquisition of the Mine Street properties was that each of Habib and Jason were to hold their respective 50 per cent interests in the Mine Street properties legally and beneficially for themselves.
[271] The principle relating to the joint endeavour constructive trust were articulated in Baumgartner v Baumgartner [1987] HCA 59; (1987) 164 CLR 137 by Mason CJ, Wilson and Deane JJ, particularly at 147 and 148. In doing so, their Honours approved the earlier observations of Deane J in Muschinski v Dodds [1985] HCA 78; (1985) 160 CLR 583.
[272] Relevantly, the principle operates where the substratum of a joint relationship or endeavour has been removed without attributable blame, and where the benefit of money or other property contributable by one party on the basis and for the purpose of the relationship or endeavour would otherwise be enjoyed by the other party in circumstances not specifically intended.
[273] The content of the principle is that, in such a case, equity will not permit the other party to assert or retain the benefit of the relevant property to the extent that it would be unconscionable for him or her to do so.
[274] Baumgartner concerned the termination of a de facto relationship. In that context, it was observed that where financial contributions had been pooled for a substantial period of time, the principle that equity favours equality was applicable, and there was much to be said for the view that the parties should be held to hold beneficial interests in equal shares as tenants in common, with suitable adjustments to take into account parties actual contributions, either financially or in kind.
[275] In Sivritas v Sivritas [2008] VSC 580; (2008) 23 VR 349 at [133], Kyrou J observed that the majority in Baumgartner also recognised that the court should, where possible, strive to give effect to the notion of practical equality, rather than pursue complicated factual inquiries which would result in relatively insignificant differences in contributions, or consequential beneficial interest.
[276] It was further observed by Kyrou J that in a case where the principle was being put forward, the person asserting that there should be a departure from the equality principle has the evidentiary onus of establishing there should be such a departure.
[277] Habib based his contention, at least in part, on the same facts he relied upon to support the common intention constructive trust. Habib variously contended:
(a) he solely contributed the $40,000 deposit;
(b) he solely purchased the Mine Street properties;
(c) he solely contributed the periodic repayments; and
(d) he solely contributed the payout of the CBA mortgage loan.
[278] I conclude that there is no reason in equity to find that there ought to be an alteration of the beneficial interests reflected by Jason and Habib's registered interests of the Mine Street properties as tenants in common in equal shares. That is, I am not satisfied that a constructive trust, or any other trust as pleaded, arises from a failed joint venture which would create a different beneficial interest in favour of Habib.
[280] First, I find that the deposit which was paid came from the Suncorp account number [XXX 8620], which I have found was an account where the family pooled their monies and then advanced monies to various family members for the purchase of property. The advance from that fund to pay the deposit on the Mine Street properties is not to be regarded as an advance of funds solely by Habib. Rather, those monies were contributed equally by Habib and Jason in discharge of part of the purchase price of the Mine Street properties.
[281] Secondly, for the reasons previously explained, I am not satisfied that Habib has discharged his onus to prove that the payment from the NAB account number [XXX 8847] should be treated as being made solely from his monies, or alternatively, in some amount greater than 50 per cent from his own monies.
[282] Thirdly, there was otherwise no careful evidence or financial analysis of the periodic contributions made prior to the payout of the mortgage loan on 4 May 2005. The evidence supports that during this period Habib was receiving the rental monies from the Mine Street properties. The rental monies were of a modest level, but Habib did not demonstrate that they were insufficient to meet the then mortgage payments.
[283] In addition, Habib did not demonstrate that any difference between the rental and the mortgage repayments was being met solely by him. I find on the balance of probability that any repayments were likely to have been met by the operation of the Family Arrangement and therefore would have represented equal contributions by Jason and Habib.
[284] It needs to be borne firmly in mind that it is Habib who is seeking to demonstrate that he made contributions to a failed joint endeavour so as to justify a finding that it would be unconscionable for Jason to retain his full beneficial interest in his 50 per cent share of the Mine Street properties. Habib has not done so. I do not accept Habib's general evidence to the contrary given at the trial.
[285] Fourthly, there was evidence which supported that at a later time Jason commenced receiving the rentals in the Mine Street properties.
[286] This trial did not involve a monetary claim or an equitable account in relation to the receipt of rental. The primary relevance of the rental on the Mine Street properties was in respect of its use as a mechanism for paying periodic mortgage debt instalments. Once the property had been paid for in full, any dispute as to the receipt of rent by either party ceased to be relevant to the alteration of the proprietary interests being asserted over the Mine Street properties themselves.
[287] In any event, there was no detailed evidence and analysis by either party so as to provide with any practicable exactitude what net rental was received by any particular party, after the taking into accounts the outgoings on the Mine Street properties.
[288] Jason did put in some evidence to show that at least when he was receiving the rent it was questionable as to whether at times there was sufficient rental being received to cover all of the holding costs of the Mine Street properties. Even that type of evidence by Jason did not provide a methodical calculation of rentals over the whole period coupled with an analysis of the holding costs over the same period.
[289] Accordingly, then, Habib has failed to discharge his onus to show that there were contributions in relation to the Mine Street properties which would have justified an implied or constructive trust over the whole of or a part of the 50 per cent interest held by Jason in the Mine Street properties.
[290] It is unnecessary to go further in relation to the elements of this particular claim. However, I will make the following observations.
[291] This was an alternative claim by Habib. His primary position was that there was no such joint endeavour because the Mine Street properties were said to have been held on a common intention constructive trust for himself. I have rejected that primary position.
[292] Jason, on the other hand, in his pleaded case effectively accepted the alternative plea that there was a joint endeavour to develop and sell the Mine Street properties.
[293] If it were necessary for me to make such a finding, I am satisfied that must have been an implicit intention of the two brothers at the point of acquisition that this was an investment property for both of them. There was no suggestion that either of the brothers ever intended to use these properties as either of their primary residences. The Family Arrangement, in part, operated to allow different members of the family to acquire pieces of real property for investment purposes. I would have found that a joint endeavour to hold the Mine Street properties as investments existed at the point of their acquisitions. I would have separately found that this joint endeavour had, at some stage, broken down irretrievably.
[294] The principles applicable to this resulting trust were discussed in Calverley v Green [1984] HCA 81; (1984) 155 CLR 242. Where only one party contributed the purchase price for a property, but the property was subsequently conveyed to two parties, equity presumes that it was intended that the party that contributed the purchase price was to be the owner of the property on a full beneficial basis.
[295] The second aspect to the principle is that if there are contributions to the purchase price in unequal shares, then equity will presume the two parties hold the property on trust for each other, consistent with the contributions to the purchase price.
[296] Again, the onus of proof to establish the presumption lies on the party seeking to establish the resulting trust.
[297] In the decision of Bosanac v Commissioner of Taxation (2022) 275 CLR 37, Kiefel CJ and Gleeson J at [64] referred to the presumption of a resulting trust in proportion to the contributions as being a presumption of fact, functionally akin to a civil onus of proof. It was said that the presumption would yield to an actual intention to the contrary if found on the balance of probabilities as an inference drawn from the totality of the evidence. The weight to be given to the fact of a contribution having been made to the purchase price in drawing an inference as to actual intention would vary according to the totality of the circumstances of the case.
[298] Their Honours then went on to observe at paragraph [66] that whether any, and if so what, inference was to be drawn about the actual intention of a contributor and the purchaser falls to be determined as an ordinary question of fact on the balance of probabilities. No pre-determined weight was to be given, either to the fact of a contribution having been made or to the characterisation of the relationship between the parties. The significance of each of those circumstances fell to be assessed within the totality of the circumstances of each case.
[299] Their Honours Gordon J and Edelman J, expressed the operation of the presumption as follows:[69]
"Whether it is classified as presumption of fact or a presumption of law, and although described as "entrenched", given the now weak nature of the presumption of resulting trust, the objective facts determine its position and significance (if any)." [Footnotes omitted]
[300] Accordingly, then, whilst the presumption is one which is so embedded in the jurisprudence that the High Court was not prepared to depart from its existence, the presumption is not one which should be overly weighted, but rather it should be approached in the manner identified by their Honours in Bosanac.
[301] Habib's contention on this issue mirrors his previous contentions. This involves a series of propositions, namely:
(a) all of the monies for the purchase of the Mine Street properties were Habib's monies;
(b) all of the deposit monies of $40,000 were Habib's monies;
(c) all of the mortgage repayments were from Habib's monies; and
(d) all of the mortgage repayments of $90,168.27 were from Habib's monies.
[302] The resolution of this contention is arrived at in a similar way to the prior contentions.
[303] Habib has failed to discharge his onus to establish that the contributions to the purchase price were made other than equally by the parties.
[304] First, for the reasons previously expressed, I treat the payment of the deposit from monies in the Suncorp account number [XXX 8620] as being a contribution made equally by Habib and Jason as a result of the operation of the Family Arrangement.
[305] Secondly, I find that Habib and Jason made equal contribution to the remaining purchase price of the Mine Street properties by reason of their joint loan obtained from the CBA, to which they were both parties and for which they were both mortgagors in respect of their interests in the Mine Street properties. Their joint liability equated to equal contributions to the acquisition of the Mine Street properties.
[306] Thirdly, the subsequent repayments of the mortgages were not themselves a contribution to the purchase price, but nonetheless they could have operated as contributions which could have given rise to an equitable charge over the property so as to reflect any unequal repayments of the mortgage debts of which both Jason and Habib were the registered mortgagors.[70]
[307] However, as I have found above, the NAB account number [XXX 8847] was being operated at the relevant time as part of the Family Arrangement and accordingly, the $90,168.27 payment from it to payout the CBA mortgage loans ought to be treated as an equal payment on behalf of Habib and Jason. I have separately found that Habib has not discharged his onus in proving that the said payment was made by him in an amount greater than 50 per cent of the total amount.
[308] Fourthly, Habib did not discharge his onus in proving that he had made unequal and greater contributions for the periodic mortgage payments, in order to give rise to an equitable charge to reflect payments greater than 50 per cent. Further, on the balance of probability, I have found that such periodic mortgage payments not covered by the rentals would have been paid in any event pursuant to the Family Arrangement. Accordingly, any such periodic mortgage payments which had been made would have been paid equally by Jason and Habib.
[309] Fifthly, any rental payments received by Jason or Habib after the mortgage was discharged are irrelevant to the creation of such a resulting trust or equitable charge.
[310] In these circumstances, I reject Habib's claim that there is a purchase money resulting trust or an equitable charge, over the whole of Jason's 50 per cent interest in the Mine Street properties.
[311] The result of these findings and conclusions set out above is that Habib has not made out his counterclaim and it ought to be dismissed.
[312] Habib having been unsuccessful in his counterclaim, I must then determine whether the relief for the appointment for trustees for sale under the Property Law Act 2023 should succeed. The answer to that question is that it should.
[313] The principles applicable to the appointment of trustees for statutory sale, under the former s 38 of the Property Law Act 1974, were summarised by her Honour Bowskill CJ in McPaul v Massignani (2023) 14 Qd R 332 at [24] - [28] as follows:
"[24]The purpose of orders for sale by statutory trust is "to provide a statutory mechanism for terminating the co-ownership of land when the co-owners fail themselves to agree on the manner in which the co-ownership shall be terminated". As Wilson J (with the agreement of Muir and Gotterson JJA) said in Bunnings Group Ltd v Asden Developments Pty Ltd [2013] QCA 347; [2014] 1 Qd R 493 at [45]:
"The statutory scheme for the appointment of statutory trustees for sale reflects the commercial reality that it is generally easier to sell the entirety than it is to sell a fractional interest, let alone a fractional interest that is encumbered."
[25] Whilst it has been confirmed that the power to appoint a statutory trustee under s 38 is discretionary, the circumstances in which that discretion would be exercised against the making of an order, when one is sought by a co-owner, are very limited.
[26]As McMurdo JA said in Wilson v Strzelcykowski [2016] QCA 227 at 2-3:
"The nature of a court's discretion under s 38(1) of the Property Law Act 1974 is confined in that ordinarily the discretion will be ordered in favour of the appointment of trustees for sale, essentially because the remedy under s 38 is a valuable ingredient of a co-owner's proprietary interest."
[27]His Honour referred to the statement made in Goodwin v Goodwin [2004] QCA 50, by McPherson JA with the agreement of Williams JA and McMurdo J (as his Honour then was), that "[i]t is well settled that, to an application under s 38 of the Property Law Act... there is practically speaking no defence". That is because the statutory right conferred by s 38 is an incident of the property of a co-owner.
[28]In relation to the New South Wales equivalent, in Foundas v Arambatzis [2020] NSWCA 47 at [63] the Court of Appeal of New South Wales (White JA, Bell P and Basten JA agreeing) said: "Although an order under s 66G is discretionary, such an order is almost as of right, unless on settled principles it would be inequitable to make the order. An order may be refused if the appointment of trustees for sale would be inconsistent with a proprietary right, or the applicant for the order is acting in breach of contract or fiduciary duty, or is estopped from seeking or obtaining the order ... Hardship or general unfairness is not a sufficient ground for declining relief under s 66G..." (Footnotes omitted)
[314] Those principles remain relevant to an order made pursuant to ss 34 and 37 of the new Property Law Act 2023.
[315] Here, there is no legal or factual basis raised which would justify an exercise of the discretion against the appointment of statutory trustees for sale.
[316] The proposed statutory trustees are Russell David Sparke and Phillip Leon Pennington. Both are solicitors of good repute. They have provided a written consent to being appointed as statutory trustees. Habib required them for cross-examination, but his cross-examination did not raise any issue which would militate against their appointment.
[317] I find that they are both appropriate persons to be appointed, and that I ought to exercise my discretion to appoint them in accordance with the orders which I will set out below. I exercise my discretion to make the orders pursuant to the provisions of the new Property Law Act 2023, which came into operation shortly after the final day of hearing of this proceeding. I would have made the same orders under the pre-existing provisions of the Property Law Act 1974 if they had remained in operation.
[319] In relation to both the costs of the plaintiff's claim and costs of the defendant's counterclaim, I will hear the parties in respect of those matters and make the appropriate costs order at a later date.
[1] At the time of the application the Property Law Act 1974 (Qld) was in force. The Property Law Act 2023 (Qld) is now in force, and the equivalent sections under the new Act are ss 34 and 37.
[2] Hinrichsen v Hinrichsen [2025] QCA 252 at [48] per Doyle JA (with whom Mullins P and Brown JA agreed), citing Galati v Deans [2023] NSWCA 13 at [53].
[3] Imam Ali Islamic Centre v Imam Ali Islamic Centre Inc [2018] VSC 413 at [402].
[4] Calverley v Green [1984] HCA 81; (1984) 155 CLR 242 at 261 per Mason and Brennan JJ (as their Honours then were).
[5] Approved of by Mason and Brennan JJ in Calverley v Green [1984] HCA 81; (1984) 155 CLR 242 at 261-262.
[6] AAT Proceeding: P-128 ll 23-27; P-128 11 43-47 to P-129 ll 1-42; P-165 ll 13-31.
[7] AAT Proceeding: P-165 ll 33-47; P-166 ll 1-27.
[8] AAT Proceeding: P-215 ll 40-46; P-216 ll 1-15.
[12] T1-62 ll 20-35; T1-63 ll 17-23; T1-70 ll 25-40; T1-71 ll 16-40; T1-73 ll 9-32; T1-144 ll 17-35.
[13] T2-80 ll 33-46 to T2-81 ll 1-22; T2-81 ll 46-47 to T2-82 ll 1-4.
[14] This extract of the Family Agreement has been precisely replicated, including any typographical and grammatical errors.
[15] These email extracts have been directly copied, including any typographical and grammatical errors.
[16] These email extracts have been directly copied, including any typographical and grammatical errors.
[17] These email extracts have been directly copied, including any typographical and grammatical errors.
[18] These email extracts have been directly copied, including any typographical and grammatical errors.
[19] These email extracts have been directly copied, including any typographical and grammatical errors.
[20] These email extracts have been directly copied, including any typographical and grammatical errors.
[21] These email extracts have been directly copied, including any typographical and grammatical errors.
[22] These email extracts have been directly copied, including any typographical and grammatical errors.
[23] These email extracts have been directly copied, including any typographical and grammatical errors.
[24] These email extracts have been directly copied, including any typographical and grammatical errors.
[25] These email extracts have been directly copied, including any typographical and grammatical errors.
[26] These email extracts have been directly copied, including any typographical and grammatical errors.
[27] This email extract has been directly copied, including any typographical and grammatical errors.
[28] This email extract has been directly copied, including any typographical and grammatical errors.
[29] This email extract has been directly copied, including any typographical and grammatical errors.
[30] I assume this was a reference to the Family Agreement.
[31] This email extract has been directly copied, including any typographical and grammatical errors.
[32] This email extract has been directly copied, including any typographical and grammatical errors.
[33] This email extract has been directly copied, including any typographical and grammatical errors.
[34] This text message extract has been directly copied, including any typographical and grammatical errors.
[35] This text message extract has been directly copied, including any typographical and grammatical errors.
[36] This text message extract has been directly copied, including any typographical and grammatical errors.
[37] Being a reference to the then debt which Jason was saying he was not going to refinance.
[38] This email extract has been directly copied, including any typographical and grammatical errors.
[39] This email extract has been directly copied, including any typographical and grammatical errors.
[40] This email extract has been directly copied, including any typographical and grammatical errors.
[41] Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336.
[45] Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336.
[50] Although the transcript states "proceeded", Jason likely meant "proceeds".
[52] Its intended operation is somewhat opaque. The covering email suggests that the properties were intended to be mortgaged to Jayhab Developments Pty Ltd, but the execution clause seemed to contemplate a transfer of the properties to Jayhab Developments Pty Ltd. The email and spreadsheet also contemplated an apportionment of the liability under an existing line of credit between Habib and Jason.
[53] Jason's Answer to Further Amended Counterclaim at [7(e)(i)] in the particulars at [K].
[55] I have added the "[?]" into the transcript to indicate where counsel's question ended and Jason's answer began.
[62] T2-114 ll 41-46 to T2-115 ll 1-18.
[63] State Penalties Enforcement Registry.
[66] These text message extracts have been directly copied, including any typographical and grammatical errors.
[69] Bosanac v Commissioner of Taxation (2022) 275 CLR 37 at [103].
[70] Sivritas v Sivritas [2008] VSC 580; (2008) 23 VR 349 at [135] per Kyrou J.
Habchi
Habchi [2026] QSC 67
(1987) 164 CLR 137
(2022) 275 CLR 37
(1938) 60 CLR 336
(1984) 155 CLR 242
(2023) 14 Qd R 332
(1985) 160 CLR 583
(2008) 23 VR 349