Harvey v Barton

The issues 16The proceedings raise three issues. The first issue is whether Ms Barton is liable to repay Ms Harvey a debt of £38,000 ($109,132) under an agreement between Ms Harvey and Ms Barton made in about 1996 in relation to the purchase of the UK property. Ms Harvey claims that she loaned Ms Barton £38,000 to assist her to buy the UK Property on the basis that the loan would be repaid whenever the property was sold by Ms Barton. There is a question, which has not been raised by Ms Barton in her defence, as to whether Ms Harvey's entitlement to recover this debt, assuming that it is proved, is now statute barred. 17The second and principal issue is whether Ms Harvey is entitled to a beneficial interest in a residential property at 148 Kingsway, Woolooware, NSW (the "Home"), of which Ms Barton is the sole registered proprietor. Ms Harvey claims an equitable interest by reason of her contributions to the purchase price of the Home, as well as the conversations between herself and Ms Barton concerning the manner in which title to the Home would be held. On Ms Harvey's case part of her contribution to the purchase price was the $109,132 that Ms Barton was obliged to repay her from the proceeds of sale of the UK property. If Ms Barton owed that sum to Ms Harvey, and as the Home was purchased before any relevant limitation period expired, the debt was capable of forming part of Ms Harvey's contribution to the purchase price. If Ms Harvey succeeds in her case that she is entitled to a beneficial interest in the Home based in part on her contribution of the amount of the debt towards the purchase price, then she would not be entitled as well to repayment of the debt. In that case the question whether Ms Harvey would otherwise be disentitled from recovering the debt because of the lapse of the limitation period would disappear. 18The third issue is whether, at the time Ms Harvey left the Home, certain personal property items listed in par 28 of the second further amended statement of claim remained at the Home, and whether Ms Barton has converted that property to her own use by failing or refusing to return the property to Ms Harvey following a demand being made by letter written by Legal Aid NSW on 27 April 2012 that she do so.

Loan to purchase UK property 19An extract from the records kept by H. M. Land Registry that was tendered into evidence establishes that the UK property was transferred to Ms Barton on 13 May 1996 for a price of £27,730 and that the transfer was filed at the Registry on 23 May 1996. 20Ms Harvey gave evidence of conversations between herself and Ms Barton concerning the provision by Ms Harvey of £38,000 as the price for the UK property. Ms Harvey said that she was perplexed when the extract from the Registry established that the price was only £27,730. Ms Barton did not contest that Ms Harvey provided £38,000, although according to Ms Barton, Ms Harvey paid £28,000 to Ms Barton and a further £10,000 to Ms Barton's then partner, in each case as a gift and not as a loan. 21Ms Harvey's evidence on this subject is to be found in pars 17 to 42 of her principal affidavit, which was sworn on 19 September 2012. Relevantly, she said that some time in 1996 Ms Barton told her that she had the opportunity to buy the UK property, which was a council house in which the family had been living. Ms Barton said: "I can't buy it without you because I have no money. I need you to give me the money." Ms Harvey said that she responded: "I'll do it but the property has to be in my name as well". Ms Harvey followed that evidence with the statement: "I agreed to lend (sic) my daughter Maria". The evidence of Ms Harvey's intention that she be on the title and at the same time that her payment would be a loan is inconsistent. Ultimately this inconsistency does not give rise to a difficulty, because it is clear from the evidence of the subsequent discussions between the parties, and Ms Harvey's evidence concerning Ms Barton signing a document which evidenced the making of a loan by Ms Harvey to Ms Barton, that Ms Harvey's case is that the parties agreed that Ms Harvey would make a loan rather than receive part ownership of the UK property. 22Ms Harvey raised the £38,000 by selling a boat called 'Close Encounter' which she had owned with her late husband, David. Ashley gave evidence of being present on an occasion when her mother said to her grandmother: "We won't be able to buy the property unless you loan me the money". 23Ms Harvey gave evidence that, after she had given the £38,000 to Ms Barton, Ms Barton told her that she and her partner had decided to put the house in their names and not in Ms Harvey's. That statement led to a disagreement that had the result that Ms Barton threw Ms Harvey out of the house so that Ms Harvey had to stay in cheap accommodation for about three days. During that time, according to Ms Harvey, Ms Barton again refused to put Ms Harvey's name on the title, but said: "We will make a contract that I will pay you the money back." 24Both Peter and Ashley gave detailed evidence that corroborated Ms Harvey's claim that she was thrown out of the house during the course of the argument as to whether or not her name would be put on the title to the UK property when it was purchased. They each said that they overheard a conversation between their mother and grandmother in which Ms Barton said, in effect, that if Ms Harvey did not contribute her money to the purchase of the UK property she would not see her grandchildren again. 25Ms Harvey gave evidence that Ms Barton prepared a written agreement which said that Ms Barton was borrowing £38,000 from Ms Harvey and that she would pay the money back with interest. Ms Harvey said that she discussed the loan with Ms Barton and said that she did not want the money paid back in instalments, but rather wanted the whole amount paid back when the UK property was sold. Ms Harvey said that she made a few copies of the agreement at various times, although she did not retain any of the copies at the time of the trial. Peter said that he was present at a time when his mother came down from upstairs with a typed piece of paper, and said to his grandmother: "This is what we have agreed". He said that his mother further said: "It says mum will give me the money, the house will be in my name, [Ms Barton's partner's name] will not be on it, when we sell it you will get your money back plus any profit". Ashley also said that on that day she saw her mother hand her grandmother a piece of paper with typed writing on it, and that her mother signed the piece of paper and gave it to Ms Harvey. 26The UK property was sold on 31 July 2002 for £142,000, which was $407, 809 in Australian dollars. 27Ms Harvey gave evidence that she did not learn about the sale of the UK property until about March 2003, when she was told of the sale by Ms Barton. Peter said that his mother had told him and Ashley not to tell Ms Harvey about the sale of the house, and that when Ms Harvey asked about the house Ms Barton would say: "Don't worry, when we sell you will get the money, but now is not a good time to sell it". 28Ms Harvey said that some time after Ms Barton bought the Home, and she and her daughter were talking about sorting out their paperwork, Ms Barton asked Ms Harvey whether she had the written agreement about the money for the UK property. Ms Harvey said she had the agreement and gave it to Ms Barton at the latter's request. Ms Harvey said that Ms Barton tore up the agreement in front of her. Peter confirmed that he heard his mother asking his grandmother where the agreement was, and that his mother looked for the agreement from time to time. One day Ms Barton found the written agreement, which Peter recognised from the time he was present in England when it was prepared. Shortly afterwards Ms Barton asked Peter to drive her to the shops, and while he was driving Ms Barton tore the piece of paper up in front of him, and then threw the pieces in different garbage bins. Peter did not give evidence that Ms Harvey was present when the agreement was torn up and disposed of. There is an obvious element of inconsistency between the versions of events as recalled by Ms Harvey and Peter. Both, however, gave clear evidence of being present when the written agreement concerning the loan to purchase the UK property was torn up by Ms Barton. 29Ms Barton's position concerning the purchase of the UK property was that Ms Harvey made a gift to her of the amount of £28,000 on the basis of an agreement that the property would be put in the name of Ms Barton, and that Ms Barton would allow Ms Harvey to live in that property with her family as long as she wished to do so, and would be included in the application that the family members intended to make for permission to migrate to Australia. 30Ms Barton denied that she signed a written agreement which provided for Ms Harvey to make any loan to Ms Barton in respect of the purchase of the UK property, and accordingly denied that she tore up the loan agreement. 31My finding is that Ms Harvey did pay £38,000 to Ms Barton to fund the purchase of the UK property, that the payment was a loan and not a gift, that the agreement between Ms Harvey and Ms Barton was that the loan would be repaid from the proceeds of resale of the UK property, when that eventually occurred, and that their mutual intention was that the agreement would be legally binding. I also find that Ms Barton prepared, and signed, and gave to Ms Harvey a written document that generally recorded the terms of the agreement. That document was torn up by Ms Barton some time after the Home in Woolooware was purchased. 32The evidence established that the UK property was sold on 31 July 2002, which was the date when the £38,000 became repayable. According to Ms Harvey's own evidence, she became aware of the sale no later than about March 2003. 33Ms Harvey's cause of action to sue Ms Barton for recovery of the loan arose on 31 July 2002, or in any event no later than about March 2003. Ms Harvey commenced her proceedings to recover the loan by filing, by her tutor, her original statement of claim on 21 September 2012, more than nine years after her cause of action arose. By the time the proceedings were commenced it is likely that the claim was statute barred, whether under section 14 of the Limitation Act 1969 (NSW) or section 5 of the Limitation Act 1980 (UK), each of which provide for a limitation period of six years from the date on which the cause of action accrued for an action founded on a simple contract. 34Ms Barton's defence does not plead the available limitation defence. I raised with counsel for Ms Harvey the issue of what the court should do in a case where a plaintiff's pleadings and evidence established that a claim for the repayment of the debt was statute barred, but the defence of a party who appeared to represent herself did not raise that defence. The response given on behalf of Ms Harvey was that the defence was irrelevant because it had not been raised on the pleadings. Counsel relied upon the fact that Ms Barton was represented by a solicitor, who apparently drew her amended defence. 35As a result of the finding that I make below that Ms Harvey and Ms Barton agreed that Ms Barton could apply the amount of the loan towards the purchase price of the Home, it is not necessary for me to decide whether it would be proper for me to reject Ms Harvey's claim for the repayment of the loan because the claim is statute barred, notwithstanding that a limitation defence has not been pleaded. 36I am, however, inclined to the view that the statutory injunction in section 56(1) of the Civil Procedure Act 2005 (NSW) that the overriding purpose of the Act and the rules of court is to facilitate the "just" resolution of the real issues in the proceedings would require me to dismiss a claim for a contractual debt in the case of a self represented defendant, where the plaintiff's own pleadings and evidence clearly show that the debt is statute barred. Ms Barton, representing herself at the trial, has denied that she is indebted to Ms Harvey as claimed, but Ms Barton evidently does not appreciate the principles concerning the limitation of actions, or the need to plead any limitation defence if one is available to her.

Beneficial ownership of the home 37Ms Harvey then claims that Ms Barton holds the title to the Home partly on trust for Ms Harvey. Ms Harvey makes the claim on the alternative bases that Ms Barton's ownership of the Home is subject to a constructive trust or a resulting trust. She claims in her second further amended statement of claim: "3. ...a Declaration pursuant to the Court's equitable jurisdiction that the Defendant holds her title and interest in [the Home] on constructive trust for the Plaintiff in the amount of ($109,132+ $156,000)/$760,000 being 34.88% of the purchase price of the Home or such other amount as determined by the Court. 4. Alternatively, a Declaration pursuant to the Court's equitable jurisdiction that the Defendant holds her title and interest in the home on resulting trust for the Plaintiff in the amount of ($109,132 + $156,000)/$760,000 being 34.88% of the purchase price of the Home or such other amount as determined by the Court." 38In each of these orders the numerator is the total of $109,132, being the £38,000 debt arising from loan made by Ms Harvey to Ms Barton to purchase the UK property converted into Australian dollars at the date of the sale of that property, plus an amount of $156,000 which Ms Harvey alleges she additionally provided to Ms Barton as part of the purchase price for the Home. The denominator is the purchase price of the Home plus the costs of purchase. 39In pars 6 and 7 of her claim for relief Ms Harvey claims orders in the same terms as paragraphs 3 and 4 respectively, save that in each case the numerator in the fraction is only $156,000. These alternative claims proceed upon the assumption that the court finds that Ms Harvey contributed the $156,000 towards the purchase price of the Home as she alleges, but does not accept either that the £38,000 contributed by Ms Harvey to the purchase of the UK property was made as an enforceable loan, or if it was, that the Australian dollar equivalent of that amount was not by agreement included with the $156,000 as part of Ms Harvey's contribution to the purchase price of the Home. 40Ms Harvey makes a further alternative claim in par 8 for a declaration that she is entitled to a charge over the title to the Home for an amount equal to 34.88% of the purchase price of the Home, where the fraction is calculated in the same way as the fraction in par 3 and 4. Ultimately in her submissions Ms Harvey did not seek to support her claim for a declaration as to the existence of a charge, and did not explain the legal basis for her claim, or how it arose on the evidence. 41In par 9 Ms Harvey seeks an order for the sale of the Home and the distribution of the net proceeds in accordance with the parties' respective interests as declared by the court. In par 7 of her supplementary written submissions Ms Harvey sets out in detail the order which she asks the court to make in order to vest the Home in trustees for the purpose of its sale. 42Ms Harvey pleads (in par 18) that prior to his death Mr Corbett made financial provision for the plaintiff, and that between 20 November 2003 and 17 November 2004 Ms Harvey withdrew approximately $156,000 from a number of bank accounts into which she had paid the money received from Mr Corbett "and gave these monies to the Defendant with the express and common intention that the Home would be purchased by the Plaintiff and Defendant as the Registered Proprietors, and that the Defendant would care for the Plaintiff for the remainder of the Plaintiff's life". Ms Harvey further pleads (in par 19) that in the alternative to the $109,132 Australian dollar equivalent of the £38,000 being a debt due from Ms Barton to Ms Harvey, it was an additional contribution to the price paid by Ms Barton to acquire the Home. 43In par 20 Ms Harvey gives particulars of 10 withdrawals that he made from three banks that she says she paid to Ms Barton. The particulars to par 21 identify three deposits of $150,000 in total that Ms Barton made into a bank account. The withdrawals made by Ms Harvey were on dates between 21 November 2003 and 17 February 2004. The deposits made by Ms Barton were allegedly made between June and September 2004. There were therefore significant time gaps between the withdrawals made by Ms Harvey and the deposits made by Ms Barton. The Home was purchased on 13 July 2004 and the transfer was registered on 19 July 2004. 44Ms Harvey said in her affidavit that Ms Barton imposed upon her after the death of Mr Corbett to withdraw money from her accounts in cash and to give the cash to Ms Barton. Ms Harvey does not know how much was withdrawn. Peter and Ashley obtained records from the Australian Transaction Reports and Analysis Centre that were annexed to her principal affidavit. Those records prove that Ms Harvey made each of the withdrawals as alleged, and that each of the alleged deposits was made by Ms Barton. 45Ms Harvey gave evidence that Ms Barton kept the money which was given to her in a locked metal money box at home. Peter and Ashley both corroborated Ms Harvey's evidence that Ms Harvey gave Ms Barton substantial sums in cash that were stored in metal moneyboxes. 46Ms Harvey said that she did not intend to make a gift or a loan of the money she gave to Ms Barton. She said that Ms Barton had said to her many times words to the effect (par 45): "Mum with the money from the house in England and what you got from George and I got from Albert we can buy this house and you can live here for the rest of your life and I will look after you. You don't have to worry about anything." 47The use of the word "we" would ordinarily signify that both Ms Harvey and Ms Barton would become owners. Ms Harvey also gave evidence of Ms Barton describing the proposed new home as "a family home where we will all live together". Further, according to Ms Harvey, Ms Barton acquiesced in many statements made by Ms Harvey during their search for a new home, in which Ms Harvey said that the property would pass to Ms Barton when Ms Harvey died, and then to the children after Ms Barton's death. These conversations were consistent with Ms Harvey having a beneficial interest in the Home. 48Peter gave evidence of a conversation between his mother and grandmother which took place in about early October 2003 in which Ms Barton said (par 79): "Mum we will use the money from the house in England plus the money you got from George to buy the house then any money I get from Albert will also be used so we can buy a big house. It will be great I will take care of you for the rest of your life, you will be happy seeing the kids all the time and you can use your pension to do whatever you like go bowling, doing your paintings whatever it is you want to do you can." 49Again, the use of the word "we" would convey the meaning that the house would be bought in the name of both Ms Barton and Ms Harvey. 50Ashley recalled a similar conversation which she related in the following terms (par 122): "My mother: 'I am sick of living in a council house. I want to buy a house of our own that we can live in.' My nan: 'How are you going to buy a house?' My mother: 'If we use the money from George and the house in England then we could buy something.' My nan: 'I don't know Marie. I would like to use that money to live by myself. I liked it in Queensland but I came back so I could see the children.' My mother: "If you let me keep the money from the house in England and put in the money from George then you can live with us for good. I'll look after you for the rest of your life and we will all be happy.' My nan: 'Ok Marie. I just want peace and quiet." 51Viewed as a whole this evidence also supports the inference that the agreement was that Ms Harvey would become a part owner of the home, particularly in the use of the words "our" and "we". 52Ms Barton did not contest the proposition that Ms Harvey supplied money that was used to assist in the purchase of the Home. Her position was that it was always agreed that the Home would be purchased in the name of Ms Barton, who would be the sole owner. The consideration which Ms Harvey was to receive for providing the money was that she would be permitted to live in the Home for as long as she wished to, which among other things would give her continuous, close access to her grandchildren. 53Had that been the consideration which Ms Harvey agreed to accept, it would have been very tenuous indeed, given the evidence of Ms Barton's preparedness to throw Ms Harvey out of her home when sufficiently displeased by Ms Harvey's conduct. The evidence shows that the proceeds of sale of the boat owned with Mr Harvey before his death, and the provision that Mr Corbett made for Ms Harvey, represented the totality of Ms Harvey's life's capital. Ms Harvey's only income flowed from her entitlement to UK and Australian pensions. It is inherently improbable that a woman of Ms Harvey's age, in her position in life, would readily give away the whole of her capital in return for a tenuous promise of future accommodation. 54The weight of the evidence favours a finding that the agreement between Ms Harvey and Ms Barton was that they would both have their names on the title to the Home. That is so even though the evidence does not establish that they turned their minds to the proportions in which they would hold the beneficial ownership of the property. The evidence may have supported an inference that, in the circumstances, it was implicit that they accepted that the property would be held in equal shares. Ms Harvey's claim to a beneficial interest that is proportional to her financial contribution to the purchase price may be seen to be a reasonable and relatively conservative approach to establishing her proportional entitlement.

Credibility of witnesses 55It is convenient at this stage to consider the evidence concerning the credibility of each of the witnesses. 56It appears from the evidence that the family has suffered a total breakdown in the family relationship, and that Ms Barton is now estranged from her mother and children. Ms Harvey, Peter and Ashley gave the address of Legal Aid NSW as their addresses on their affidavits. 57The evidence that was tendered, and explored in great depth in cross-examination, delved into the interpersonal relationships between Ms Barton and her family, including various male partners of Ms Barton from time to time, over the whole of the period from about 1994. Some of this evidence was highly personal, and it would not be appropriate or helpful for the court to record that evidence in these reasons for judgment unless it is necessary for the determination of the issues before the court. 58The family lived under the one roof for most of the time from about 1993, immediately after the death of Mr Harvey, until about the beginning of 2006 when Ashley left the Home permanently. The residences in which the family lived included rental accommodation at 10 Berkeley Crescent, East Barnet, Hertfordshire, the UK property, which was initially rented and then purchased in the name of Ms Barton, rental properties at Sylvania, Sylvania Heights and Sutherland in NSW after the family emigrated to Australia, and finally the Home. As has been noted, for a period Ms Harvey resided in Queensland with Mr Corbett. She returned to live with Ms Barton and her family following the death of Mr Corbett. Peter left the Home in about December 2010, and Ms Harvey did so on about 4 March 2011. According to Ms Harvey, Peter and Ashley each left the home following relatively traumatic emotional episodes involving the conduct of Ms Barton. Each of Ms Harvey, Peter and Ashley gave evidence that Ms Barton suffered regular and acute mood swings, which caused emotional episodes which were highly destructive over an extended period of the emotional bonds within the family. Ms Barton is not a large woman, but the other witnesses gave evidence of frequent violent episodes on Ms Barton's part. 59Ms Harvey, Peter and Ashley gave detailed evidence in their affidavits in proper evidentiary form of relevant events extending back to about 1993 or 1994. The contents of the affidavits were highly consistent, including as to the details of conversations which occurred up to a decade or more ago. Some of these conversations occurred when Peter and Ashley were young children, starting with Peter being about seven years of age, and Ashley being about five. It would be natural for the court to have some initial scepticism as to the veracity and reliability of evidence of this nature. 60However, Ms Barton cross-examined the witnesses for Ms Harvey at considerable length. The process of that cross-examination substantially involved Ms Barton taking the witnesses to a large proportion of the paragraphs in their affidavits in numerical order, and exploring with the witnesses whether the events deposed to occurred in the manner set out. Ms Barton tended not to put contradictory versions to the witnesses, but invited them to elaborate in various ways on their written evidence. 61The effect was that the witnesses were required, albeit incompletely and somewhat randomly, to give their affidavit evidence again orally, and extensively. This afforded the court the considerable benefit of hearing the evidence of Ms Harvey's witnesses out of their own mouths. 62This process led me to form the clear view that the witnesses in Ms Harvey's case gave credible, honest and genuinely recollected evidence. Peter and Ashley's evidence was given without evident rancour, was as dispassionate as the circumstances would permit, and was apparently given more in sorrow than in anger. Peter has responsible employment as a case manager in a financial corporation, and Ashley graduated from her law degree during the course of the trial. Notably, in cross-examination both witnesses gave evidence of significant emotional episodes associated with the events in the course of their childhood of which they gave detailed evidence in their affidavits. This evidence provided encouragement to the court to accept much of the evidence that had initially raised some scepticism. 63I also accept Ms Harvey as a witness of truth. She answered all questions put to her promptly and responsively, with consistency and apparent candour. Ms Harvey responded appropriately to questions that were sometimes somewhat provocative in the emotional context with considerable dignity and directness. 64The evidence given by Ms Harvey, Peter and Ashley was consistent, particularly in respect of the events that are critical to the outcome of the dispute. 65So far as Ms Barton's evidence is concerned, it must be acknowledged that she behaved respectfully and with considerable dignity in the way she conducted her own defence. The paramount forensic issue was whether contributions of money which Ms Harvey made to the purchase of the UK property and the Home were agreed to be gifts made by Ms Harvey to Ms Barton, or whether in the case of the UK property the money was agreed to be a loan, and in the case of the Home whether the UK loan and the money contributed by Ms Harvey were collectively agreed between Ms Harvey and Ms Barton to give Ms Harvey a beneficial interest in the Home. 66At its highest Ms Barton's evidence took the form of an assertion, repeated over and over again, that the substantial effect of relevant conversations was that Ms Harvey had agreed to make gifts to Ms Barton, in return for Ms Barton's agreement to allow Ms Harvey to live in the relevant home, and be looked after and cared for by Ms Barton, as long as Ms Harvey should want. Ms Barton's evidence suffered naturally from the fact that it was formulated and presented by a layperson, and Ms Barton's case did not have the benefit of any confirmatory evidence by other witnesses to corroborate her version of events. 67There were, however, aspects of the manner in which Ms Barton gave evidence, particularly in cross-examination, as well as a number of actions on her part that were explored in cross-examination, which undermined her credibility as a witness as well as the plausibility of her evidence. 68First, Ms Barton responded to a considerable number of questions in cross-examination, which required her to acknowledge a relatively simple fact which ought to have been within her own knowledge, by saying: "I am not sure", or words to that effect. Ms Barton attempted to justify this form of response by asserting that, as she was under oath, her recollection was not absolutely clear enough to enable her to acknowledge the truth of the proposition being put to her. This approach was unconvincing when first employed, but was used by Ms Barton to a degree that, it is unfortunate for me to have to say, became farcical. 69Secondly, the following conduct by Ms Barton undermines her standing as an honest person in relation to matters going to her own financial interests. 70The Home was purchased in the name of Ms Barton on 13 July 2004. 71For that purpose Ms Barton borrowed $250,000 from Wizard Home Loans Pty Ltd ("Wizard"), which was secured by a mortgage over the Home. Ms Harvey's affidavit sworn on 18 December 2012 annexed two documents that were brought into existence for the purpose of the loan application to Wizard. 72The first document is a statutory declaration under the Oaths Act 1900 (NSW), which was declared by Ms Harvey. 73The operative part of the statutory declaration says: "I, MARIA LUZ HARVEY of 7 MURONGA PLACE KIRRAWEE 2232 in the state of NEW SOUTH WALES do hereby solemnly declare and affirm that: - I WILL BE GIVING MY DAUGHTER MARIA LUZ BARTON NON-REFUNDABLE GIFT OF $275,000.00 TO ASSIST HER WITH HER NEW INVESTMENT PROPERTY PURCHASE." 74Ms Harvey's signature on the statutory declaration was witnessed by Mr Con Anton, who is described as Wizard's Business Writer in Ms Barton's loan application to Wizard. In her affidavit Ms Harvey says that she had no recollection of signing the document. She says that she did not sign the document in front of Mr Anton. Ms Harvey says that she did not give her daughter $275,000 as a non-refundable gift. Ms Harvey says that she went with Ms Barton only on one occasion "to the loan people in Caringbah". Ms Harvey says that "the man we saw told [Ms Barton] that he could not give her a loan, but he said that if she was a businesswoman she could get a loan immediately". Ms Harvey also gave evidence of a conversation between the man, who she could not identify, and Ms Barton, in the following terms: "The man: 'Tell me what you did in your life that we could convert into you being a businesswoman.' Maria: 'I used to do therapeutic massage for years'. The man: 'Fantastic. We can put you down as doing that. We will arrange that for you. I will talk to someone who will register you as a businesswoman. The only thing you need to do is make business cards and phone them tomorrow." 75This conversation corroborates to some extent the assertion made by Ms Barton in evidence that she filled in the loan application documents for Wizard in the manner recommended by a Wizard representative. This issue will be dealt with in more detail below. Of course, even if some representative of Wizard advised Ms Barton to include false information in her application for a loan, that does not absolve Ms Barton of the falsehood, or rescue her credibility. 76Ms Harvey gave evidence that on at least two occasions she could remember signing papers that Ms Barton gave her to sign, saying to Ms Harvey that she just needed to sign the document and Ms Barton would fill it in later. The first time was before Ms Harvey went to Queensland in 2000 or 2001. That occasion concerned a car accident about a year before Ms Harvey went to Queensland. The second occasion was when Ms Harvey and Ms Barton were dealing with the money Ms Harvey was getting from Mr Corbett after he died. Ms Harvey said that in each case Ms Barton asked her to sign the document on the basis that Ms Barton would fill it out later. Ms Harvey did not specifically link these arrangements to the circumstances in which her signature appeared on the statutory declaration. 77Ms Barton agreed in cross-examination that the operative part of the statutory declaration was in her handwriting (T 334.40). 78Two aspects of the statutory declaration are questionable. The first is that the amount of $275,000, stated as being the non-refundable gift made by Ms Harvey to Ms Barton, could not have been correct, even if Ms Barton's claim that Ms Harvey had given her the $109,132 which represented the £38,000 which came from the sale of the UK property, and the $156,000 which came primarily from the gift made by Mr Corbett to Ms Harvey, was correct. If Ms Harvey did not make any gift to Ms Barton then the statement that a gift of $275,000 was made was clearly wrong. But, even if Ms Harvey did make the gift to Ms Barton, the statement was still wrong. The arithmetical reason why this last observation is correct will be considered below in relation to a relevant aspect of the loan application made by Ms Barton to Wizard. 79The second false statement made in the statutory declaration is the proposition that the gift was made to assist Ms Barton with her new investment property purchase. It is clear that Ms Barton's intention at the time was that the Home would be used as the family home, and not as an investment property. 80I will call the second document annexed to Ms Harvey's 18 December 2012 affidavit the "loan application". It is a composite document made up of a number of separate documents. 81The first part of the loan application is a Wizard form called "FASTDOC 65 OR Fastdoc Plus". It is three pages long and is apparently signed by Mr Anton. It contains the following material information. 82On page 2 part of the form has the heading "BACKGROUND REPORT". There is a statement of the purpose for which the loan is required. The purpose given is: "THE CLIENT HAS PURCHASED AN INVESTMENT PROPERTY AT WOOLOOWARE FOR $750,000. SHE HAS PAID 0.25% DEPOSIT OF $1875 AND IS ON A 5 DAY COOLING OFF PERIOD. THE CLIENT LIVES AT HER MOTHERS PROPERTY AT KIRRAWEE RENT FREE. THIS ENABLES HER TO RENT OUT THE WOOLOOWARE PROPERTY TO ASSIST WITH THE LOAN REPAYMENTS + TAX BENEFITS." 83The statement that Ms Barton had purchased an investment property was false. The statement that Ms Barton lived at her mother's property rent-free was also false. Ms Harvey did not have a property at Kirrawee or anywhere else. Ms Barton, who was responsible for the payment of the rent, was the tenant of the property at Kirrawee. 84On page 3 Ms Barton stated that she had been a "SELF EMPLOYED PHYSIOTHERAPIST FOR 12 MONTHS". Ms Barton was not employed as a physiotherapist over that period. Her statement that her income was $60,000 per annum was also false. Ms Barton also represented that she would have rental income of $420 per week. I take this to refer to the expected income of the Home, which Ms Barton stated on her loan application was intended to be an investment property. In fact, she proposed to acquire the property as the family home. Accordingly, it would not generate rental income. The statement of the funds required to complete the purchase repeated the representation that the acquisition would be as an "investment property" and that Ms Barton had available "$275,000 NON-REFUNDABLE GIFT FROM CLIENTS MOTHER (See attached Statutory Declaration)". 85The statement of funds to complete includes a statement that Ms Barton had "$340,891 CASH AT BANK (See Attached CBA printout)". The printout is not included in the annexure. The evidence suggests, however, that a printout from the CBA confirmed that Ms Barton had $340,891 in her bank account. 86The RESIDENTIAL PROPERTY LOAN APPLICATION that was signed by Ms Barton on 8 June 2004 repeated the claim that she had been a self-employed physiotherapist for 12 months on a current salary of $60,000 per annum. In the ASSET & LIABILITY STATEMENT Ms Barton stated that the rent that she paid per week was "$0". That statement was not correct, as Ms Barton was living in rented accommodation. 87As has been noted above, the UK Property was sold on 31 July 2002 for £142,000. The equivalent in Australian dollars was $407, 809. Ms Barton's income was relatively modest, and it may be inferred that her income was expended on day-to-day family needs. The amount of $340,891 in Ms Barton's CBA bank account must have been the remainder of the sale proceeds, and any other monies that Ms Barton may have received from sources other than Ms Harvey. A question arises as to the validity of Ms Barton's claim that Ms Harvey had made a gift to her of $275,000. Ms Harvey's evidence was that she had paid approximately $156,000 to Ms Barton in cash in the period before the purchase of the Home. Ms Barton did not give evidence that Ms Harvey had paid her a greater sum, and in particular did not say that the amount paid was $275,000. In the absence of an arithmetically sound explanation, it appears that in addition to the issue of whether Ms Harvey made any loan to Ms Barton at all of the $275,000, that amount substantially exceeded the sum which Ms Harvey had in fact handed to Ms Barton. 88Included in the loan application documents was a DECLARATION OF PURPOSE, which was expressly required to be completed if the applicant believed "that the proposed loan is NOT provided wholly or predominantly for personal, domestic or household purposes". A declaration of purpose was stated to be required under "the Consumer Credit Act, Section 11, and Regulation 10". The applicant was asked to sign the declaration: "If you have completed the Loan Purpose Checklist on the previous page and you believe that the loan you are applying for is to be used wholly or predominantly for investment or business purposes". Ms Barton signed this representation to the credit provider confirming that the credit "will be applied wholly or predominantly for business or investment purposes". A box on the documents in bold print set out immediately above the place for Ms Barton's signature stated: "IMPORTANT NOTICE: You should not sign this declaration unless this loan is wholly or predominantly for business or investment purposes. By signing this declaration you may lose your protection under the Consumer Credit Code." 89Finally, on 9 June 2004 Ms Barton signed a further DECLARATION, which again confirmed that she was a self-employed physiotherapist. 90Ms Barton was cross-examined at some length about the truthfulness of the information that she provided to Wizard in connection with her loan application. 91Ms Barton admitted that she was not a qualified physiotherapist, and did not have any qualifications in physiotherapy (Tp 314.45-315.1). At a later time when Ms Barton was pressed to admit that she was never a physiotherapist, she said she was advised by Wizard how to fill out the application forms. Asked twice to give a yes or no answer to the question her response was: "I've already answered that question" (Tp 332.30-40). Asked whether she knew that she had to fill out an application form so that Wizard could make a decision whether or not it would lend money, Ms Barton repeatedly said: "I'm not sure" (Tp 324.15-25). Asked whether she completed the loan application at an interview with Con Anton, Ms Barton said: "I'm not sure" (Tp 324.45). Ms Barton said that she was not sure whether, when she completed the document, that she was aware that she was making a loan application to Wizard (Tp 327.50). Ms Barton was not sure whether she entered into a contract of sale for the purchase of the Home (Tp 328.30-45). She was not sure why she made an application to Wizard (Tp 328.50). Ms Barton did not accept that at the time she made the application she had an available bank balance of $340,717 (Tp 330.20-50). When Ms Barton was asked to admit that she never earned a salary of $60,000 as a physiotherapist, her response was that she was advised by Wizard how to fill out the forms (Tp 332.40). Ms Barton gave the same explanation for her statement in the application form that the property would be purchased for investment purposes (Tp 334.5). When pressed to give a yes or no answer to whether she knew that the amount of $60,000 as her annual income was false, Ms Barton's response was: "As I continue to say, Wizard Home Loans advised me on filling out these applications". 92Ms Barton accepted that the handwriting on the statutory declaration was her own (Tp 334.40). When asked whether she received $275,000 from her mother as a gift after 9 June 2004 Ms Barton's response was: "I'm not sure" (Tp 335.35). 93Ms Barton was cross-examined about an incident that occurred in England when she was still a minor that led to her arrest and imprisonment (Tp 343.50-345.35). Ms Barton agreed that she was arrested at Euston station after a police officer was assaulted by something being thrown at him. Ms Barton said that she was an innocent bystander. She was convicted and incarcerated at Borstal for nine months. I have placed very little weight on this incident given Ms Barton's age at the time, and the period that has elapsed since it occurred. 94Ms Barton is something of an enigma so far as her credibility is concerned. Generally in the way she conducted herself in her defence before the court Ms Barton appeared to be reasonably forthright. However, in relation to the circumstances in which she acquired the Home, and obtained money for that purpose from her mother, and then defended her conduct in the witness box, her evidence is not reliable. Ms Barton's refusal to acknowledge reality during her cross-examination in the form of her persistent response of "I'm not sure", when confronted with obviously true propositions, strongly suggests that she knew full well what the truth was. There is no necessity for the court to speculate upon Ms Barton's general creditworthiness, because the only relevant issue concerns Ms Barton's entitlement to sole ownership of the Home, and on that issue the court could not accept Ms Barton's evidence in preference to the evidence of Ms Harvey and her grandchildren.

Ms Barton's submissions 95Ms Barton delivered to the court 88 pages of written submissions. She accepted an offer from the court to provide her submissions in written form in preference to her being put in the position of having to do justice to her case by means of oral submissions. She was given a number of extensions of time because she suffered from some physical incapacity that impeded her from producing written submissions. As it became necessary for the court to conclude the process of submissions, the proceedings were relisted on 30 October 2013 to permit Ms Barton to conclude her submissions by supplementing the written submissions that had already been delivered. It became apparent on that date that Ms Barton had been able to complete her submissions in writing on her laptop computer. An arrangement was made with her consent for the balance of her submissions to be sent electronically to the court, and they were accordingly printed out and provided to Ms Barton and the legal representatives for Ms Harvey. Ms Barton agreed that the court should receive the document as the balance of the submissions that she wished to make. The additional submissions were 44 pages in length. 96As a general matter Ms Barton's written submissions have been prepared in a coherent way, and convey reasonably clearly the points that she wishes to make in her defence. As a layperson Ms Barton has, on a number of occasions in her written submissions, gone beyond what is proper for the court to accept, in that she has included new evidence, made submissions on evidence that was rejected at the hearing, and made submissions as if evidence had been received at the trial, when it was not in fact received. I advised Ms Barton that I would take into account the parts of her written submissions that could properly be treated as submissions based upon the evidence at the trial, and that I would ignore the balance. 97Ms Barton's submissions have largely taken the form of setting out in some detail parts of the evidence led on behalf of Ms Harvey, and then making comments, often of a detailed nature, as to why the court should not accept that evidence. I do not propose to analyse Ms Barton's submissions in detail, although I have read all of them. Many of the points made by Ms Barton have some validity, but her attack on Ms Harvey's evidence was generally directed at the margins. Ms Barton did not really grapple with the fundamental issues in the case concerning the likelihood that Ms Harvey gave her money to Ms Barton in order to permit Ms Barton to buy the Home in her own name to the exclusion of Ms Harvey. A substantial part of Ms Barton's submissions challenged in detail aspects of the evidence going to the history of the family's tribulations that did not matter to the outcome of the dispute. It is often difficult to disentangle within the written submissions arguments that are properly founded on the evidence, and arguments that should have been put as evidence at the trial. 98The resolution of the present dispute ultimately depends upon the answers to a number of relatively simple factual questions. Did Ms Harvey pay to Ms Barton the £38,000 that the former said was paid? If so, was the money paid as a loan or as a gift. If it was paid as a loan, did Ms Harvey agree with Ms Barton that the latter could apply the amount of the loan towards the purchase of the Home? In relation to the series of payments which Ms Harvey made to Ms Barton, which Ms Barton applied towards the purchase of the Home, did Ms Harvey agree with Ms Barton that the latter could use the money to buy the Home on the basis that Ms Barton would be the beneficial owner, and Ms Harvey would be satisfied with Ms Barton's agreement to allow Ms Harvey to reside at the Home during her lifetime and accept Ms Barton's care and support during that time? Alternatively, did Ms Harvey and Ms Barton agree that Ms Harvey would apply the money, together with Ms Harvey's share of the proceeds of sale of the UK property, to the purchase of the Home on the basis that the both of them would own the Home beneficially together? 99The evidence strongly persuades me that each of these questions should be answered in the way that leads to the conclusion that the agreement between Ms Harvey and Ms Barton was that the money which Ms Harvey contributed towards the purchase price of the Home would be reflected in a share on her part in the beneficial ownership of the Home at least proportional to her contribution to the total cost of acquisition of the Home. 100In coming to this conclusion I have accepted the evidence of Ms Harvey, supported as it was by the evidence given by Peter and Ashley, in preference to the evidence of Ms Barton. 101In deciding that the evidence of Ms Harvey is to be preferred, I have given weight to the findings that I have set out above as to the circumstances which diminish Ms Barton's credibility as a witness, at least where the issue in dispute touches upon her personal ownership of property. However, of greater significance is my conclusion, based upon the whole of the evidence, that on the probabilities, in the period leading up to the purchase of the Home, it is extremely unlikely that Ms Harvey would willingly have given away the money which represented the whole of her worldly assets, and the only funds available to her to preserve her independence and to provide her with a reasonable level of security and comfort during the remainder of her life. I am satisfied that Ms Harvey is a reasonably independent woman who accepted a life within Ms Barton's family home for substantial periods over the years out of love for her grandchildren, and I believe her daughter as well. Ms Harvey is not naturally dependent, and I do not accept that she willingly gave away her worldly assets to her daughter in return for the uncertain benefits of Ms Barton's unrecorded agreement to provide her with indefinite comfort and support. 102The legal effect of the evidence is that Ms Barton holds the legal title to the Home partially on a resulting trust for Ms Harvey in the proportion that Ms Harvey's total contribution of funds to the acquisition of the Home bears to the total cost of the acquisition: see Calverley v Green (1984) 155 CLR 242 and Brown v Brown (1993) 31 NSWLR 582. 103In the general case, as a matter of law, a resulting trust arises where A pays to the vendor of property the price of acquisition on the basis that title to the property is transferred to B. That did not occur in the present case. Ms Harvey's share of the proceeds from the sale of the UK property was received by Ms Harvey as an undivided share of the net sale price. Ms Barton was obliged to repay that share to Ms Harvey, but instead Ms Harvey agreed that Ms Barton could use the money towards the purchase price of the Home. In the case of the cash payments which Ms Harvey made to Ms Barton, those payments were made on the basis that Ms Barton would keep the cash and eventually apply it in the manner agreed with Ms Harvey towards the purchase price of the Home. In Brown v New South Wales Trustee and Guardian [2012] NSWCA 431, Campbell JA, with whom Bergin CJ in Eq and Sackville AJA relevantly agreed, held at [51] that the principles which may give rise to a resulting trust are not limited to the situation where A physically pays the purchase money to the vendor, but extend to the case where A gives the money to B on the basis that B will hold it for the purpose only of paying the money to the vendor as the price, or part of the price, for the property. 104Ms Barton raised an argument in her closing submissions that, as Ms Harvey was her mother, there is a presumption of advancement such that the court should find that Ms Harvey intended to make a gift of the money to her daughter, Ms Barton, unless that presumption is rebutted. In my opinion the evidence objectively establishes that Ms Harvey did not intend to make a gift of the money to Ms Barton. Ms Harvey's evidence has rebutted the presumption of advancement. 105Had I not found that Ms Harvey's claim to the benefit of a resulting trust has been made out, I would have found that in all of the circumstances Ms Barton received the cash payments made to her by Ms Harvey, and agreed in relation to that money and Ms Harvey's share in the proceeds of sale of the UK property, that she would acquire the Home on behalf of Ms Harvey and herself. As she acquired the title to the Home in her own name alone, in breach of the understanding with Ms Harvey, Ms Barton would have held the title to the Home on a constructive trust for Ms Harvey as to the proportion that Ms Harvey's contribution to the price bears to the total cost of acquisition: see Vukic v Luca Grbin & Ors; Estate of Zvonko Grbin [2006] NSWSC 41.

Conversion claim 106In pars 28 to 31 of her second further amended statement of claim Ms Harvey makes a claim for conversion in relation to 26 items of property against Ms Barton. Ms Harvey's case is that when she was forced to leave the Home these items of her property remained there. By letter dated 27 April 2012 the plaintiff, by her solicitor, demanded that the listed items be returned to her, but Ms Barton has failed to deliver the items to Ms Harvey, or to make available the items to be collected by her. 107Ms Barton has acknowledged that item a, being a grand piano and piano seat, are in her possession and she is prepared to permit Ms Harvey to collect them. Ms Harvey requests that the court make an order that Ms Barton deliver up the grand piano and piano seat within seven days. I will make that order, save that the order should provide that Ms Barton will make the grand piano and piano seat available for collection by Ms Harvey at the Home at some mutually agreed time. 108As I understand Ms Barton's position, she denies that she retains any of the other items claimed by Ms Harvey, and says that Ms Harvey removed her property when she left the Home 109In her pleading Ms Harvey alleges that the value of the 25 items of property that have not been delivered up to her and whose whereabouts remain in issue is $11,435 in total, save for items l, y and z, whose value is said to be unknown. Ms Harvey did not tender any evidence at the hearing to establish the value of the items. She submitted that the appropriate course to be taken in relation to these items is that, in the absence of some resolution by agreement between the parties, the court should make an order for a referral at which the value of the items can be established. 110Ms Harvey's evidence in support of her conversion claim consisted of one paragraph of her principal affidavit in which she said that when she left the Home "I left behind the following items of personal property", and then she listed the items and their estimated value, where known. Ms Harvey did not say where any of the items were located within the Home when she left. 111Ms Barton's evidence does not really respond to Ms Harvey's conversion claim at all. That may well be a consequence of the fact that Ms Barton prepared her own evidence. Her stance at the trial was, as I understood it, that she did not have the items and Ms Harvey had taken them with her. Ms Barton did not directly address whether she acknowledged that Ms Harvey had owned the items, whether to Ms Barton's knowledge the items were kept by Ms Harvey within the Home before her departure, whether Ms Barton knew from personal observation that the items were removed by Ms Harvey, or whether Ms Barton at any time redelivered any of the items to Ms Harvey. 112I do not regard the evidence led by either party on the conversion issue as being entirely satisfactory, and it is not a sound basis upon which to make a judgment that Ms Barton has converted each of the items of property by refusing to allow them to be collected by Ms Harvey. 113On balance I think it is more likely than not, given the circumstances in which Ms Harvey left the Home, that items of her property such as are listed in her statement of claim were left within the Home wherever they were located at the time of her departure. However, in all of the circumstances, particularly the relatively small value of the outstanding items, I would hesitate simply to make an order against Ms Barton at this stage that she pay damages for converting each of the items, and then make some consequential order as to how the value of the items converted should be determined. There is a significant likelihood that the cost of the exercise will exceed the value of the items. 114I propose to give Ms Barton a brief time to reconsider her position, and if she is able to do so to return identified items to Ms Harvey. In relation to any items which are not returned I will give Ms Barton the opportunity in the same short period to provide any specific explanation she is able to give concerning her knowledge of the presence of the items of property at the Home, what if anything was done with them, and their present whereabouts. In relation to any items that are not returned, I will invite both parties to submit brief evidence in simple form as to the value of the items. I will then make a summary determination of an appropriate amount of damages to be awarded, and will do so on the papers. I do not think it is appropriate for the court to subject the parties to the costs of a referral process.

Relief 115I will make the following orders in this matter. The orders in pars (2) to (7) will not become effective until the plaintiff complies with all relevant rules concerning the filing of consents and necessary affidavits in relation to the appointment of trustees for sale. It will be necessary for me to hear the parties as to the appropriate amount to be inserted into order (7). (1)Declaration that the defendant holds her title and interest in the land situate at 148 Kingsway, Woolooware, New South Wales Folio identifier 4/8658 (the "Property") on the basis that 35% is held on a resulting trust for the plaintiff, and the amount of any loan secured by any mortgage or charge over the title to the Property is to be discharged out of the 65% remaining interest in the Property held by the defendant beneficially. (2)Order that Andrew Barnden and Geoff Reidy of Rodgers Reidy Chartered Accountants be appointed as trustees for the sale of the Property. (3)Order that the Property be vested in such trustees subject to any encumbrances affecting any undivided share or shares therein to be held by the trustees upon statutory trust for sale under Division 6 of Part 4 of the Conveyancing Act 1919. (4)Order that the trustees can sell the Property, discharge any loan, and/or mortgage, or charge, and pay all disbursements incurred in the sale of the Property including but not limited to the trustees' professional fees, rates and taxes, real estate agent's marketing expenses and commissions, professional fees for the conveyance of the property, and any other expense, and to account to, and pay to each party the net proceeds of sale in proportion to their respective interest in the property. (5)Order that either of the parties is entitled to purchase the Property whether at auction or otherwise without payment of a deposit. (6)Order that either of the parties is entitled to purchase the Property whether at auction or otherwise by setting off that party's entitlement to the proceeds against the money bid or offered. (7)Order that the trustees are authorised to charge at a rate not exceeding $595 plus GST per hour, and in the total sum not exceeding $[insert amount], and are authorised to deduct all such expenses from the proceeds of sale. (8)Order the defendant to permit the plaintiff to collect from the Property the plaintiff's grand piano and piano seat at some mutually arranged time within 7 days of this order. (9)Direct the defendant in relation to the items of property listed in subpars 28 b to z of the plaintiff's second further amended statement of claim to take such of the following steps as she may wish to take (a)make arrangements for the plaintiff to be able to collect the item from the Property at some mutually convenient time within 7 days of the making of this order; (b)deliver to the plaintiff's solicitor and the associate to Justice Robb within 7 days of the making of this order a written statement of the defendant's knowledge of where each item was at the time the plaintiff left the Property and what has happened to the item since that time. (10)Direct the parties to deliver to the associate to Justice Robb within 21 days of the making of this order evidence of the value of each item of property that is not returned by the defendant to the plaintiff as at the date the plaintiff left the Property in March 2011. (11)Parties have leave to apply on 3 days' notice to the associate to Justice Robb. (12)Order that the defendant pay the plaintiff's costs on the ordinary basis.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 09 December 2013