//
© 2026 Zoe. All rights reserved.
Zoe is a legal information platform. Always consult the Federal Register of Legislation for authoritative text.
[2006] NSWCA 184
Court of Appeal (NSW)
2006-07-14
Handley JA, Hodgson JA, Bryson JA, Barrett J
Original judgment source is linked above.
CITATION: KHOURY & ANOR v KHOURI [2006] NSWCA 184
JUDGMENT OF: Handley JA at 1; Hodgson JA at 9; Bryson JA at 26
CATCHWORDS: VENDOR and PURCHASER - agreement for sale of interest in land - no written memorandum under Conveyancing Act s.23C or s.54A - part performance by payments - brother and brother made oral agreement for sale of half interest as tenant in common held by vendor in common with sister - agreement operated as present declaration of trust - consideration whether compliance with s.23C necessary for enforcement - consideration whether compliance with s.54A necessary for enforcement - held that it is necessary - Doctrine of Part Performance considered - whether part payment to vendor and arrangement for third party to pay off mortgage for which vendor was liable constituted Part Performance - held they did not - consideration of history of Part Performance in applying Statute of Frauds - payments are not acts of Part Performance - appeal allowed.
Conveyancing (Amendment) Act 1930 (NSW) LEGISLATION CITED: Conveyancing Act 1919 (NSW) ss.54A and 23C, 23D(1), 7(1), 23E Law of Property Act 1925 (UK) Statute of Frauds 1677 (England) ss.3, 4, 7, 8 and 9.
Abjornsen v Urban Newspapers Ltd (1989) WAR 191 Acorn Computers Ltd v MCS Microcomputer Systems Pty Ltd (1984) 6 FCR 277 Adamson v Hayes (1973) 130 CLR 276 Australian and New Zealand Banking Group Ltd v Widin (1990) 26 FCR 21 Baloglow v Konstantinidis & Ors (2001) 11 BPR 20,721, [2001] NSWCA 451 Britain v Rossiter (1882) 11 QBD 123 Butcher v Stapely (1685) 1 Vernon 363, 23 ER 524 Cooney v Burns (1922) 30 CLR 216 Gunter v Halsey (1739) Ambler 586, 27 ER 381 Hagan v Waterhouse (1991) 34 NSWLR 308 CASES CITED: Halloran v Minister Administering National Parks and Wildlife Act 1974 [2006] HCA 3, 80 ALJR 519 ISPT Nominees Pty Ltd v Chief Commissioner of State Revenue [2003] NSWSC 697, 53 ATR 527 JC Williamson Ltd v Lukey & Mulholland (1931) 45 CLR 282 Khouri v Khoury [2004] NSWSC 770 Last v Rosenfeld [1972] 2 NSWLR 923 Maddison v Alderson (1883) 8 App Cas 467 McBride v Sandland (1918) 25 CLR 69 Regent v Millett (1976) 133 CLR 679 Secretary, Department of Social Security v James (1990) 95 ALR 615 Steadman v Steadman [1976] AC 536 Theodore v Mistford Pty Ltd [2005] HCA 45, 79 ALJR 1503, (2005) 221 CLR 612 Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387
Marina Khoury - 1st Appellant PARTIES: Peter Basil Khoury - 2nd Appellant Bechara Khouri - Respondent
COUNSEL: T.G.R. Parker SC & R.E. Steele - (A) A.J.L.Ogborne - (R)
SOLICITORS: Michie, Shehadie & Co. - (A) Di Lizio & Associates - (R)
LOWER COURT JURISDICTION: Supreme Court - Equity Division
LOWER COURT DATE OF DECISION: 26 August 2004
LOWER COURT MEDIUM NEUTRAL CITATION: [2004] NSWSC 770
IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 41151/04
HANDLEY JA HODGSON JA BRYSON JA
1 HANDLEY JA: In this matter I have had the great benefit of reading the reasons for judgment of Bryson JA in draft. I agree with his Honour's reasons and the orders he has proposed but will add some additional remarks.
2 Section 54A of the Conveyancing Act 1919 provides in substance that proceedings may not be brought "upon any contract for the sale or other disposition of land or any interest in land" unless there is a sufficient memorandum of that contract in writing signed by the party to be charged. Disposition is defined in s 7(1) as including a declaration of trust. The oral agreement between Peter and Bechara found by the trial Judge was, as Bryson JA has found (para [45]) a contract for the sale of Peter's half share in the property. As such the contract was within s 54A.
3 As Bryson JA has also noted (para [40]) the trial Judge characterised the agreement as a contract under which Peter promised to declare a trust in favour of Bechara. Such a declaration must be in writing (Conveyancing Act s 23C(1)(b)), but there is no reason why a contract to declare such a trust should be treated as outside s 54A. Such a contract would be one "for the disposition of land or any interest in land".
4 A declaration of trust of land creates an equitable interest in the land in favour of the beneficiary and does not convey an existing interest to him. A contract for the creation of a new interest, legal or equitable, in land is nevertheless a contract for the disposition of that interest.
5 This principle was well established in the case law on s 4 of the Statute of Frauds prior to the enactment of s 54A. Thus an agreement for a mortgage or charge of land was within the statute: Ex parte Hall (1878) 10 Ch D 615 CA, 620, 621. In Dalgety & Co Ltd v Gray (1919) 26 CLR 249 at 254-5 Lord Dunedin, delivering the judgment of the Privy Council, said: "That is … an agreement to get a mortgage, involving a promise on the part of the Company to produce a mortgagee and a correlative obligation on the plaintiff to execute a mortgage - all on the terms specified. That is an agreement to create an interest in land, and is struck at by the Statute of Frauds …" (emphasis supplied)
6 This principle has been applied to an agreement to grant an option of purchase: Jeffrey v Anderson [1914] QSR 66; an agreement for lease: Vaughan v Hancock (1846) 3 CB 766 [136 ER 307]; an agreement to create an easement: McManus v Cooke (1887) 35 Ch D 681, 689, 698; and an agreement to create a profit à prendre: Webber v Lee (1882) 9 QBD 315. There is also authority, if authority is needed, that a declaration of trust is a disposition of property, although the case was not decided on s 4 of the Statute of Frauds. In Richards v Delbridge (1874) LR 18 Eq 11, 14 Sir George Jessel MR said: "A man may transfer his property … in one of two ways: he may either do such acts as amount in law to a conveyance or assignment of the property … or [he] may, by one or other of the modes recognised as amounting to a valid declaration of trust, constitute himself a trustee … and declare that he will hold it from that time forward on trust for the other person."
7 These principles are confirmed by Williston on Contracts 2nd ed, 1936 which states (p 1413) that an oral contract to mortgage or give security on real estate is unenforceable; that (p 1414) a promise to give or take a lease is within the statute, and that the statute applies to contracts for the creation or sale of equitable interests (p 1416).
9 HODGSON JA: The appellants, who for convenience I will call Marina and Peter, are registered proprietors as tenants in common of a house at Bass Hill. The primary judge did not make a finding as to any mortgage over the property. However, he did find that in 1996 a previous loan from the Commonwealth Bank was paid out by a loan of $130,000.00 or thereabouts from the Arab Bank, secured by a mortgage, presumably over this property; and the Amended Defence alleges that this loan was paid out in 2000 by a loan from the ANZ Bank, again presumably secured by mortgage over this property. So it seems likely that there is a mortgage over this property, probably to the ANZ Bank.
10 On 25 November 2004, Barrett J made a declaration that Peter holds, and since 1992 has held, his one-half share in this property on trust for the respondent, who I will call Bechara.
11 The basis of this order was a finding that in 1992 there was an oral agreement between Peter and Bechara to the following effect: Bechara to pay Peter $30,000 initially and pay Peter's share of instalments under the Commonwealth Bank loan (under which Peter and Marina were borrowers) in exchange for Peter's promise to hold his one half share in the Johnston Road property for the benefit of (that is, on trust for) Bechara.
12 The primary judge also found that Bechara had performed his obligations under the agreement by paying $30,000.00 to Peter in 1992, and paying $70,000.00 to Bishop Rimlawi, who in turn paid this amount to the Commonwealth Bank thereby discharging Peter's share of that loan.
13 In relation to a defence relying on s.54A of the Conveyancing Act 1919, the primary judge held that it did not apply to this agreement; and that even if it had applied, and even though Bechara never entered into possession of the property, the payments made by Bechara coupled with Peter's giving up possession and ceasing to make loan repayments in 1992 were sufficient acts of part performance.
14 It is clear in my opinion that the agreement could not take effect as a present declaration of trust: it falls squarely within s.23C(1)(b) of the Conveyancing Act.
15 If it could take effect at all, it was as an agreement to create a trust. The primary judge held that such an agreement was not affected by s.54A of the Conveyancing Act. In my opinion, he was in error. Although a declaration of trust in respect of land is a creation of an interest in that land rather than a transfer or assignment of such an interest, it is in my opinion plainly a disposition of an interest in land, within the meaning of s.54A. The grant of a lease is a creation of an interest in land rather than a transfer or assignment of such an interest; and I do not think it could be said that it is not a disposition of an interest in land. In my view, a declaration of trust is not relevantly different.
16 Accordingly, the contract was enforceable by Bechara only if he could establish part performance. This requires that there must be acts done under and by force of the contract that are unequivocally and in their own nature referable to some such agreement as that alleged: Regent v. Millett (1976) 133 CLR 679 at 682-3; Walton Stores (Interstate) Limited v. Maher (1988) 164 CLR 387 at 432.
17 It seems clear that the circumstances in which acts were done are to be considered in order to consider whether the acts pass this test; but in my opinion, there cannot be included in these circumstances alleged oral agreements either between the parties in question or with others: that would entirely subvert s.54A. Accordingly, in this case, Bechara cannot rely on an alleged oral agreement between himself and Bishop Rimlawi to use the $70,000.00 paid by Bechara to the bishop to pay off Peter's share of the loan from the Commonwealth Bank, as support for Bechara's alleged acts of part performance.
18 In my opinion, the acts and circumstances that could possibly be relied on are: (1) Payment of $30,000.00 by Bechara to Peter at about the time of the agreement. (2) Peter leaving the property and ceasing to pay mortgage instalments at about the same time, and applying $30,000.00 towards another property. (3) Payment of $70,000.00 by Bechara to Bishop Rimlawi over the following months or years. (4) Payment by Bishop Rimlawi of $70,000.00 in reduction of the Commonwealth Bank loan, this being approximately Peter's share of what was to be paid under that loan.
19 It is important to note that the effect of item (2) was not to give Bechara possession of the property, but merely to leave Marina (and perhaps other family members) in possession. It is also relevant that Marina paid Bishop Rimlawi over $70,000.00 out of the proceeds of refinancing the property with the Arab Bank.
20 In my opinion, items (3) and (4) must be considered without regard to the alleged oral agreement between Bechara and the bishop; and also considered in circumstances where no close link in time or amount was shown between any payments by Bechara to the bishop and any payments by the bishop to the bank, and where Marina also paid a similar sum to the bishop. In those circumstances, in my opinion, those items cannot be considered, either alone or in combination with items (1) and (2), as being referable to some such agreement as alleged.
21 Items (1) and (2) in combination could be considered as being referable to an agreement whereby some consideration was to go from Peter to Bechara, but not in my opinion as being unequivocally referable to an agreement whereby Bechara acquired an interest in the property. Bechara himself did not exercise any right in relation to the property or undertake any duties in relation to the property, so that Peter's giving up of possession and ceasing mortgage payments is equivocal, at least in that this could relate to benefits given to and burdens undertaken by Marina. His application of $30,000.00 towards another property is also equivocal. The combination of these matters with Bechara's payment of $30,000.00 to Peter does not in my opinion give that payment the character of being unequivocally referable to an agreement whereby Bechara acquired an interest in the property.
22 For those reasons, along with those given by Bryson JA with which I substantially agree, I would allow the appeal.
24 First, although this was not made a ground of appeal, I am doubtful whether this claim should have been resolved by a simple declaration of right. Given the effect of s.23C(1)(b) of the Conveyancing Act, the relevant remedy had to be specific performance of a contract and, assuming there is a mortgage to the ANZ Bank over the property, there is a question whether a bare declaration of right could be justified by its utility, and a question whether it avoids multiplicity of proceedings. It is perhaps implicit in the judgment that, in so far as Peter's share of the property is encumbered by such a mortgage, it should somehow be exonerated, but that question was not explored. Ultimate enforcement of Bechara's rights would also involve sorting out the rights as regards the legal estate, having regard to the rule in Saunders v. Vautier (1841) 4 Beav 115, 49 ER 282. This would in turn raise questions as to the position of the mortgagee and what was to be done about the mortgage.
25 Second, it is conceivable that alternative remedies may be available where alleged part performance of a contract affected by s.54A consists in payments of money, which are held not to be unequivocally referable to the kind of contract alleged. Money paid in those circumstances could conceivably be regarded as money paid for a consideration which has totally failed; and it is conceivable that some more general notion of estoppel could apply. There may of course be problems with claims of this kind, including limitation problems. The possibility of such remedies was not explored below or raised on appeal.
26 BRYSON JA: The appellants Marina and Peter Khoury, who were defendants in the Equity Division, appealed from the judgment of Barrett J. of 26 August 2004 [2004] NSWSC 770 and order of 25 November 2004 in a sad dispute among family members about ownership of the house property at 93 Johnston Road, Bass Hill. Bechara Khouri the respondent was the plaintiff in the Equity Division. I respectfully refer to the principal figures by their forenames for the sake of clarity. Marina, Peter and Bechara are three of seven brothers and sisters. Marina and Peter purchased the house in 1988 and became registered proprietors as tenants in common in equal shares; and they still are. From then on they and their parents lived in the property as their home. In 1992 Peter purchased a property at Glenfield and moved out of the house at Bass Hill; and he has not occupied it since. Their parents moved out in 1996. Marina has remained in occupation, and Bechara has never occupied the house. Bechara claimed that he is entitled to the share of the house of which Peter is registered proprietor as a result of an oral agreement made between Bechara and Peter in 1992. The terms of the agreement were found by Barrett J. (Judgment [26] Red 27): 26. … I find that Peter did make an oral agreement with Bechara … On balance, the most likely version is that Bechara and Peter had an agreement that Bechara "owned" a one-half share in the Johnston Road property despite Peter's name being on the register, there being no promise to transfer the legal estate. I therefore find the agreement made between Peter and Bechara in 1992 to be to the following effect: Bechara to pay Peter $30,000 initially and pay Peter's share of instalments under the Commonwealth Bank loan (under which Peter and Marina were borrowers) in exchange for Peter's promise to hold his one half share in the Johnston Road property for the benefit of (that is, on trust for) Bechara.
27 At an earlier point in the judgment the Trial Judge said (Judgment [5] RED 19): 5. Bechara seeks to characterise the agreement in two alternative ways. First, he says that Peter agreed that, upon the nominated consideration being given, the legal estate would remain in Peter's name but be held in trust for Bechara: in short, an agreement to create a trust. Alternatively, Bechara says that Peter promised to transfer the legal estate in the property to Bechara for value, with the transfer to be deferred until requested by Bechara. For convenience I will refer to these alternatives as the "trust agreement" and the "land transfer agreement.
28 The findings clearly adopt the first characterisation, and it should be noticed that according to the finding Peter's promise to hold his one half share for the benefit of Bechara was exchanged for Bechara's promise to pay Peter's share of the instalments, so that the nominated consideration was the promise to pay the instalments. Peter's obligation to hold his share for Bechara was not deferred until payment was actually made.
29 The findings in Judgment [26] did not establish exactly what was said by each party so as to constitute an oral agreement; in the circumstances that was not really possible, and the findings state the meaning and effect of what they said; while the parenthetical reference to a trust states the construction which the law puts upon that agreement. The finding does not mean (of course) that the oral agreement used the word "trust" or that Peter said that he promised to hold his one-half share on trust; or any formulation which spoke of a trust, or of a declaration of trust.
30 Bechara asserted his interest in a formal way for the first time in August 2002, about 10 years after the oral agreement and the promise to hold the share for his benefit. He commenced these proceedings in 2002 and his Statement of Claim, which was amended twice, secondly on 22 June 2004 while the hearing proceeded, claims a declaration that Peter holds his interest in the land on trust for Bechara. There were other and alternative formulations, including a claim for specific performance. The declaratory order which Barrett J. made on 25 November 2004 was: The Court: 1. DECLARES that the second defendant (Peter Khoury) holds, and since 1992 has held, his one-half interest in the land identified in folio 8/230379 and known as 93 Johnston Road, Bass Hill, New South Wales, on trust for the plaintiff (Bechara Khouri). There was also an order for costs and an order and a note of an undertaking relating to caveats. There was no order for specific performance.
31 The declaration which Barrett J. made seems to carry an implication that the agreement could be enforced by specific performance notwithstanding ss.54A and 23C of the Conveyancing Act 1919 (NSW), without deciding other issues relating to specific performance. The doctrine of part performance relates only to equitable remedies, usually specific performance, not to common law remedies. Hence it did not apply to a claim for damages for Wrongful Dismissal where s.4 operated on a personal service contract: see Britain v Rossiter (1882) 11 QBD 123. If part performance is proved the next step is the judgment of the Court on the equities arising from the parties' conduct. It does not necessarily follow that if there has been part performance there will be an order for specific performance, although this step would often require little consideration. The declaratory order leaves Peter in the position of a bare trustee for Bechara and does not address whatever difficulties there might be if Bechara called for the transfer of registered proprietorship. As there was a registered mortgage to the Commonwealth Bank in 1992, which has since been discharged, and as there is now another registered mortgage to the Arab Bank, in which Peter and Marina are the mortgagors to secure a loan to Marina and her husband which Peter guaranteed, transfer might be difficult.
32 The Further Amended Statement of Claim dated 22 June 2004 did not make any claim against Marina or her registered interest, and did not refer to it, although there were references to the loan of $130,000 secured by mortgage to the Commonwealth Bank with which Marina and Peter purchased the property. It seems that Marina was joined as a defendant because there was some basis for thinking that she was or claimed to be equitable owner of Peter's share in competition with Bechara's claim; but whatever underlay that is no longer in point. In the Amended Defence dated 17 June 2004 Marina relied on Bechara's delay in commencing the proceedings and gave particulars of action to her detriment relating to borrowing money, making payments in reduction of the Commonwealth Bank loan and repaying the balance by borrowing from the Arab Bank; and then making repayments of that loan, partly by a further borrowing from ANZ Bank. Evidence to which the Trial Judge referred raised a suggestion that Marina was no longer or for a time was not the equitable owner of the half share of which she is registered proprietor. In the interest of resolving the whole controversy it is as well that Marina is bound by the declaratory order, although aspects of the controversy remain unresolved.
33 The hearing in the Equity Division was complex, occupied five days followed by written submissions and involved a large body of evidence from a number of people as well as the parties, and some documentary material which was difficult to understand. Documents including banking records, which one might have wished to see for corroboration of relevant events, were not available and in view of the interval before commencement of proceedings this is not surprising. It seems very remarkable and strange that the parties did not put their arrangements in writing, either in 1992 or later. No finding deals with the reasons why the agreement was not recorded in writing. It must be obvious to anyone with any business experience and to any adult who gave any thought to his or her own interests that an arrangement involving significant sums of money about something so important as ownership of a family home should be written down. There has been a law requiring dealings with land to be in writing if they are to be effective in England for well over three centuries, and in Australia for as long as there has been a legal system here, and what that law requires is no more than reasonable people would do if they considered their own interests.
34 The Notice of Appeal dated 21 March 2005 raised many grounds which were not maintained, and only two grounds appear in the Amended Notice of Appeal dated 21 September 2005 on which argument was based. These do not attack the findings of fact. They are (Orange 2): 1. The primary Judge erred in holding that: (a) section 23C of the Conveyancing Act 1919 (NSW); and (b) section 54A of the Conveyancing Act 1919 (NSW), did not apply to the agreement between the Respondent and the Second Appellant as found by the primary Judge or as alleged by the Respondent. 2. The primary Judge erred in finding that the payments of $30,000 by the Respondent to the Second Appellant and $70,000 by the Respondent to Bishop Gibran Rimlawi were acts of part performance such that either payment was unequivocally referable to an agreement of the general nature of either agreement alleged by the Respondent.
35 Argument related to the meaning and legal effect of the findings. The Court of Appeal was not given a transcript of the evidence or copies of the exhibits. The effect of the appellants' argument was to claim that, notwithstanding the respondent's success on the issues of fact, the Trial Judge should have dismissed the proceedings because of provisions of the legislation commonly called the Statute of Frauds, and of the doctrine of part performance which relates to the operation of that legislation. In New South Wales the legislation which is the successor to the Statute of Frauds 1677 (England) is found in ss.23C, 23E and 54A of the Conveyancing Act 1919: 23C (1) Subject to the provisions of this Act with respect to the creation of interests in land by parol: (a) no interest in land can be created or disposed of except by writing signed by the person creating or conveying the same, or by the person's agent thereunto lawfully authorised in writing, or by will, or by operation of law, (b) a declaration of trust respecting any land or any interest therein must be manifested and proved by some writing signed by some person who is able to declare such trust or by the person's will, (c) a disposition of an equitable interest or trust subsisting at the time of the disposition, must be in writing signed by the person disposing of the same or by the person's will, or by the person's agent thereunto lawfully authorised in writing. (2) This section does not affect the creation or operation of resulting, implied, or constructive trusts.
23E Nothing in section 23B , 23C , or 23D shall: … (d) affect the operation of the law relating to part performance.
54A (1) No action or proceedings may be brought upon any contract for the sale or other disposition of land or any interest in land, unless the agreement upon which such action or proceedings is brought, or some memorandum or note thereof, is in writing, and signed by the party to be charged or by some other person thereunto lawfully authorised by the party to be charged. (2) This section applies to contracts whether made before or after the commencement of the Conveyancing (Amendment) Act 1930 and does not affect the law relating to part performance, or sales by the court. (3) This section applies and shall be deemed to have applied from the commencement of the Conveyancing (Amendment) Act 1930 to land under the provisions of the Real Property Act 1900 .
36 The provisions of the Conveyancing Act with respect to the creation of interests in land by parol are found in s.23D(1), which gives them "the force and effect of interests at will only".
37 In argument references were made to some definitions in s.7(1) of the Conveyancing Act: Assurance includes a conveyance and a disposition made otherwise than by will; and assure has a corresponding meaning.
Conveyance includes any assignment, appointment, lease, settlement, or other assurance by deed of any property; and convey has a meaning corresponding with that of conveyance.
Disposition includes a conveyance, and also an acknowledgment under section 83 of the Wills, Probate and Administration Act 1898 , vesting instrument, declaration of trust, disclaimer, release and every other assurance of property by any instrument except a will, and also a release, devise, bequest, or an appointment of property contained in a will; and dispose has a corresponding meaning. These are no more than definitions of inclusion and do not purport to state meanings exhaustively.
38 The Conveyancing (Amendment) Act 1930 (NSW), which inserted ss.23C, 23E, 54A and the definitions of "Assurance" and "Disposition" also repealed some (but not all) of the provisions of the Statute of Frauds: see the Schedule. Section 54A was amended in minor ways by Act 1970 No.52 Second Schedule (itself amended by Act 1972 No.41 Second Schedule): these amendments did not change its meaning. Section 23C(1)(a) relates to subjects earlier dealt with by s.3 of the Statute of Frauds, para.(b) relates to s.7, para.(c) relates to s.9; and s.23C(2) corresponds to a provision, to a similar effect but quite differently expressed, in s.8 of the Statute of Frauds. Section 54A relates to some words which formed a small part of s.4 of the Statute of Frauds; the rest of s.4, which made the same requirement for writing for various transactions not necessarily involving interests in land, continued in effect, and were repealed much later. The words of s.4 which antecede s.54A(1) were: … no action shall be brought … upon any contract or sale of lands, tenements or hereditaments, or any interest in or concerning them; … unless the agreement upon which such action shall be brought, or some memorandum or note thereof, shall be in writing, and signed by the party to be charged therewith, or some other person thereunto by him lawfully authorized. The provisions inserted in the Conveyancing Act did not simply reproduce the earlier legislation; the language used was recast. Among the departures from the earlier language was the introduction of the words "or other disposition". Some words used are defined in the Conveyancing Act , so as to attract the defined meanings (unless the context or subject-matter otherwise indicates or requires - see s.7(1)). This affects "dispose", "convey", "disposition" and "assurance". It also affects "land", defined in s.7(1): Land includes tenements and hereditaments, corporeal and incorporeal, and every estate and interest therein whether vested or contingent, freehold or leasehold, and whether at law or in equity. There was no reference in the Statute of Frauds to the law relating to part performance: ss.23E(d) and 54A(2) do not represent earlier statute law. In my opinion ss.23C and 54A do more than simply re-enact and continue the previous statutory provisions, and they should be given effect upon the construction of their own language.
39 The Trial Judge was of the view that ss.23C and 54A, upon which the appellants relied in their Amended Defence and on appeal, did not apply to the respondent's claim. His Honour's views appear from the following passages in the judgment (Judgment [46] to [50] Red 35-36): The Statute of Frauds does not apply 46. The next question to be considered is whether the equitable interest created by a contract to declare a trust is an interest to which the Statute of Frauds applies. I had occasion to consider this issue in ISPT Nominees Pty Ltd v Chief Commissioner of State Revenue (2003) 53 ATR 527. I there came to the view that such an interest was not unenforceable for lack of writing.
"If this analysis be correct, it permits a harmonious relationship between s 54A of the Conveyancing Act and s 23C. The former arises at the stage of agreement to create or dispose of an interest in land. It has its own requirement of writing, less stringent than the requirement in s 23C in that a note or memorandum of the agreement is sufficient and the signing agent need not be authorised in writing. The latter arises at the stage of performance of an agreement or where there is no prior agreement, and in keeping with the importance attached to property rights has a more stringent requirement of writing in that the creative or dispositive instrument itself must be in writing and the signing agent must be authorised in writing. Section 54A excepts the operation of the law relating to part performance, material to an executory agreement, while s 23C excepts the operation of the law relating to trusts, material to property rights. Section 23C is in a Part of the Conveyancing Act dealing with property and a Division of that Part dealing with assurances, and otherwise concentrates on property rights, see s 23C(1)(b) dealing with declarations of trust and 23C(1)(c) dealing with disposition of subsisting equitable interests. There is no encouragement in its language to make it apply to executory agreements under which property rights are to be created or disposed of when the agreement is performed." 48. On this view, s.23C only applies to the immediate act of creating or disposing of an interest in land (s.23C(1)(a)), declaring a trust respecting any land or interest therein (s.23C(1)(b)) or disposition of an equitable interest or trust subsisting at the time of disposition (s.23C(1)(c)). Any antecedent act or agreement is not governed by the section. As noted by Giles JA at [191], "s.23C does not apply at all - whether as to creation or as to disposal of an interest - if there is no more than an agreement to assure the property in the future."
40 I deal first with submissions on the application of s.54A to the agreement. The Trial Judge refers (Judgment [46] and [49] Red 35-36) to the agreement in terms which are not the same as those in the finding in Judgment [26]. The Trial Judge refers at [46] to "a contract to declare a trust" and at [49] to "an agreement under which Peter promised to declare a trust in his favour." These expressions depart materially from the terms of the finding about the agreement at [26]: Peter's "promise to hold his one half share in the Johnston Road property for the benefit of (that is, on trust for) Bechara" took effect immediately. A promise in those terms, given for valuable consideration, has the immediate legal effect which would have been produced by a declaration of trust in lawyers' language. Judgment paras [46] and [49] do not contain findings of fact, which were very distinctly made in the earlier part of the judgment where findings of fact were appropriate, and those paragraphs express interpretations (in my respectful view misinterpretations) of facts which his Honour had earlier found. Subject to whatever difficulties ss.23C and 54A create, if Bechara sought equitable remedies controlling disposition of the half share, or requiring the half share to be transferred to Bechara, there would be no need for an intermediate stage in which Peter signed, or was compelled to sign a declaration of trust which was effectual under s.23C(1)(b). If Bechara sought to have the court compel Peter to execute a declaration of trust and not transfer the land to Bechara he would I suppose be entitled to that remedy, but the trust was fully constituted without any formal declaration. When the Trial Judge considered (at Judgment [46] to [50]) whether the Statute of Frauds applied he introduced a further stage which is not part of the findings of fact, in which Peter gave a contractual promise that he would declare a trust, which would be a different event at a later stage than the making of the agreement itself. Unless this stage is introduced, and making a declaration of trust is something which Peter promised to do in addition to his promise presently to hold his one half share for the benefit of Bechara, the Trial Judge's reasons cannot be understood.
41 Although the Trial Judge did not refer to an implied term I observe that there is no ground for making an implication of a term in which Peter promised to execute a declaration of trust, because such an implication is not necessary; the construction the law places on the agreement as found, made for consideration, is that a trust exists immediately.
42 The Trial Judge referred to his judgment in ISPT Nominees Pty Ltd v Chief Commissioner of State Revenue [2003] NSWSC 697, 53 ATR 527 at 599-601 paras [316]-[322]: [316] It remains, however, to consider the operation of s 54A in these circumstances. There does not seem to be any explicit authority on the question whether a contract to create a trust is a "contract for the sale or other disposition of land or any interest in land" and thus required to be in writing. It seems to me, however, that s 54A does not apply to such a contract. Two factors in particular tend towards that conclusion.
[317] First, it is necessary to consider the effect of a declaration of trust and to determine whether it is a "disposition of land or any interest in land". The decision in DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties is useful in this respect. Gibbs CJ said (at CLR 442; ATR 880; ATC 4131-32): The property comprised in the declaration of trust was the entire property in the land in question. Before the transfer was executed 29 Macquarie was the legal owner of the land; it had the whole right of property in the land, but had no separate equitable estate in it, for its equitable estate was absorbed in the legal estate … However, the property as to which the trust was declared - the property comprised in the declaration - was the whole right of property in the land, and not the bare legal estate, for it was not until the declaration of trust became operative that any separate equitable estate was created. [318] Aickin J said (at CLR 463; ATR 895; ATC 4145): It is a fundamental principle of both the common law and of equity that the holder of an estate in fee simple cannot be a trustee of that fee simple for himself for what he holds is a single estate, being the largest estate known to the law. [319] Mason J drew attention to the fact that stamp duties legislation proceeds on the "fiction" that a declaration of trust amounts to transfer of an interest in land. His Honour said (at CLR 457; ATR 891; ATC 4141): The statute proceeds upon the fiction or footing that the declarant imparts an equitable estate or interest to the beneficiary. Dixon CJ in Tooheys Ltd v Commissioner of Stamp Duties (NSW) observed: ' … that in applying the rates appropriate to a conveyance to a declaration of trust, you are required to treat the person declaring the trust as imparting property to the objects or purposes of the trust'. Mason J (and Dixon CJ), therefore, clearly thought that a declaration of trust amounted to something other than the imparting of an interest in the subject property.
[320] Brennan J said (at CLR 473-74; ATR 902; ATC 4151): Before the transfer it [the trustee] did not hold legal and equitable estates in the property: it held the legal estate alone. There was no equitable estate, for a person cannot be trustee for himself alone. [321] In Acorn v MCS Microcomputer Systems Pty Ltd (1984) 6 FCR 277; 4 IPR 214 Smithers J said (at 219), referring to an agreement to assign intellectual property for value (where such assignment had not yet taken place, and the operation of s 196(3) of the Copyright Act 1968 (Cth) (which requires an assignment of copyright to be in writing in order to be effective): It is normally the consequence of such a transaction that, value having been given, an equitable interest in the subject thereof arises in the party giving it: see Central Trust and Safe Deposit Co v Sinder [1916] AC 266 at 272; Fairweather v Fairweather (1944) 69 CLR 131 at 154. In such a case the equitable interest arises not by way of transfer but by activation in equity of the conscience of the receiver of the valuable consideration. A trust is created; there is not a transfer or assignment; there is no transmission of an equitable interest. The estate arising from a declaration a trust is appropriately spoken of as the estate created thereby; thus per Gibbs CJ in DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 491; 12 ATR 874; 82 ATC 4125. It is appropriate also to speak of the fiction that by a declaration of trust the declarant 'imparts' to the beneficiary an equitable estate or interest upon which the Stamp Duties Act 1920 (NSW) operates; per Mason J in the last-mentioned case at 457. Where there is no transmission s 196(3) of the Copyright Act 1968 (Cth) is not involved. Similarly where there is an enforceable contract to transfer property the equitable interest arising in the proposed transferee is not the product of a transfer but an exercise in creation. [322] Smithers J therefore seems to have considered that in the case of both a declaration of trust and a trust arising consequent to an enforceable contract for value to transfer property the trust that is created involves no "transmission" of an interest, but exclusively a creation of an interest in the beneficiary. In my opinion this disqualifies a contract for the declaration of a trust from being a contract for the disposition of land to which s 54A would apply.
43 The absence of explicit authority referred to in para [316] is significant. If a contract to create a trust were not required to be in writing by s.54A, or by the predecessor provision, that is very unlikely to have gone unnoticed during the centuries during which s.54A and its predecessor have been in operation.
44 The Trial Judge's consideration after para [316] is directed to the words "disposition of land or any interest in land" and not the whole expression "contract for the sale or other disposition of land or any interest in land". The words "contract", "sale" and "disposition" in their ordinary and natural meanings have very extensive references. "Disposition" in its ordinary and natural meaning is broad and general in its reference to means of disposing of property, more so in s.54A(1) where it is presented as more than an exemplification of the reference to sale, itself a word of amplitude of meaning. The reference to "land or any interest in land" attracts the definition of inclusion in s.7(1) which enhances what would otherwise be an expression of very ample meaning. An ample approach to the meaning of s.54A(1) is assisted by the words "any" and the words "of land or any interest in land".
45 To categorise the agreement as found as not a sale of Peter's one half share of the Johnston Rd property, or as not a contract for the sale of that one half share, is to depart in a marked and striking way from the ordinary and natural meaning of references to a contract and to a sale. There is a price, there is property, and there is the passing of a proprietary right in the property. In my opinion there is no less a departure from the ordinary and natural meaning of those terms if a further stage is introduced in which there is an implied promise to declare a trust; if anything, the introduction of such a promise enhances the applicability of the ordinary and natural meaning of "contract for sale" and "sale" to the transaction because the contract itself confers equitable title to the property. I make similar observations about the use of "disposition"; to agree for consideration that one holds one's interest for the benefit of another person, so as to create a trust, falls centrally within the concept of a disposition.
46 In some submissions reliance was placed on anomalies and circularities which were said to arise from the application of the definitions of "disposition" and "dispose" in s.7(1) to those words appearing in ss.23C and 54A. It was said that in the definition of "disposition" the words "other assurance of property by any instrument except a will" show that the reference in the definition is to a declaration of trust by an instrument: that the words "by any instrument" relate not only to "every other assurance of property" but to the previously appearing "declaration of trust" (and, it would I suppose follow, "disclaimer" and "release"). While there is room for doubt I am inclined to the view that this contention is correct, and that the reference in the definition of "disposition" to "declaration of trust" is a reference to a declaration of trust by an instrument. The definition is no more than a definition of inclusion and does not limit what "disposition" would otherwise mean. Context and subject matter require that this definition should not be applied to "declaration of trust" in s.23C(1)(b) because it would be an absurdity to make the provision in para (b) with relation only to declarations of trust which were by instruments, that is in writing. Similar considerations of absurdity and circularity show that the definition does not apply to the word "dispose" in s.23C(1)(a) or "disposition" appearing twice in s.23C(1)(c); and that the definition cannot produce the result, in s.54A(1) that the disposition referred to is only a disposition in writing.
47 The Trial Judge stated to the effect that the creation of a trust does not dispose of land or an interest in land and that a declaration of trust creates an interest in land and is beyond the operation of s.54A for that reason. This must be understood with the assistance of the Trial Judge's references to his judgment in ISPT Nominees. His Honour's observations on the different terms of ss.54A and 23C, which led him to see, in the use of the words "declaration of trust" in s.23C and their absence from s.54A, reinforcement for the view that declarations of trust are not dealt with in s.54A, are lacking in cogency. The history and also the terms of those sections show that it is not correct to see them as working closely together and dealing in a symmetrical and tightly drafted way, and exhaustively, with a single subject; the absence of the words "declaration of trust" from s.54A is far better explained by considering whether the words used in s.54A extend to declarations of trust among other things than by the supposition that whatever led the draughtsman to use those words in s.23C would have led him to use them again in s.54A if he intended s.54A to extend to the same concept. The consideration that no clear policy can be seen to be furthered by the exclusion of contracts to declare a trust from the operation of s.54A tells strongly against the view that s.54A does not extend to a declaration of trust. In my view it would be markedly anomalous if s.54A did not extend to a declaration of trust and no purpose for such an exception can be discerned; the desirability of requiring a memorandum or note in writing of an agreement for a sale or disposition by declaration of trust is just as strong as it is in any of the cases to which s.54A may be supposed to extend.
48 In ISPT Nominees Barrett J. at paras [317]-[322] shows the grounds for his Honour's opinion that a contract for the declaration of a trust is not a contract for the disposition of land to which s.54A would apply. Justice Barrett's treating this opinion as relevant and as a basis for decision in the present case is a product of his view that the contract as found is a contract by which Peter promised to declare a trust in Bechara's favour. As appears earlier, I am of the opinion that there is no such promise, and that, upon the contract as found, a trust arose upon the making of the agreement and passage of the consideration, without any declaration of trust being necessary or taking place. If it is necessary to consider whether and how the agreement as found falls within s.23C I am of the opinion that it falls within s.23C(1)(a) which operates to prevent an interest in land being created without writing, as well as to prevent an interest in land being disposed of except by writing. Whether or not a declaration of trust, or a transaction which the law construes as creating a trust is a disposition is something which it is not necessary to decide in order to discern that para (a) applies where a trust interest in land is created. In my opinion the passages in the judgments of Gibbs CJ and Aickin J. in DKLR Holding to which Barrett J. referred do not show or tend to show that a declaration of trust or other transaction which brought a trust into existence is not a disposition of an interest in land. Justice Mason observed to the effect that, when imposing a stamp duty, the legislation treated a declaration of trust as if it were a transfer of an interest in land, on which stamp duty is otherwise imposed. The interest in land which the creation of the trust conferred on the cestui que trust was not transferred or conveyed because it had no previous existence, but the legislature can subject that transaction to rates of duty appropriate to a conveyance if it chooses to do so, notwithstanding the property lawyer's clear understanding that it is not a conveyance at all, as appears from the passage of the judgment of Brennan J. cited in ISPT Nominees at para [320].
49 For another expression of the view that when an event creates an equitable interest in land which did not exist before the creation there is not a transfer or assignment and there is no transmission of an equitable interest see Acorn Computers Ltd v MCS Microcomputer Systems Pty Ltd (1984) 6 FCR 277 at 219 (Smithers J.).
50 In my respectful view the opinion expressed by Barrett J. in para [322] of ISPT Nominees that a contract for declaration of a trust is disqualified from being a contract for the disposition of land to which s.54A applies is incorrect, because it is not necessary, if a transaction is to be a contract for sale, or a contract for other disposition of land or any interest in land within the meaning of s.54A, that the interest sold or disposed of should already exist; a transaction which brings an equitable interest in land into existence at the moment of conferring it as much falls within the meaning of "other disposition" as a transaction which transfers ownership of an already existing interest in land. This reading accords with the ordinary and natural meaning of s.54A(1), and with the purpose for which it makes its requirements for writing.
51 In Baloglow v Konstantinidis & Ors (2001) 11 BPR 20,721, [2001] NSWCA 451 Giles JA (with the concurrence of Mason P) expressed the view (at 20,763 para [191] that s.23C "… does not apply at all - whether as to creation or as to disposal of an interest - if there is no more than an agreement to assure property in the future." This view places s.23C in apposition with s.54A "… because s.23C 'is essentially directed to creation of interests in land' and 'is not directed to agreements as such' (Abjornsen v Urban Newspapers Ltd (1989) WAR 191 at 200 per Kennedy J.). When property rights are involved, s.23C applies at the time of assurance." (Giles JA at [190]). I comment that agreements and creations of interests in land are not necessarily different events; as Giles JA said at [192], it will always come down to the agreement. In Halloran v Minister Administering National Parks and Wildlife Act 1974 [2006] HCA 3, 80 ALJR 519 at 528 [45] the leading judgment (Gleeson CJ, Gummow, Kirby & Hayne JJ) treats s.54A as distinct from s.23C in that s.54A "… is concerned not with dispositions but with the bringing of actions upon contracts for the sale or other disposition of land or any interest in land …". See too on Queensland legislation Theodore v Mistford Pty Ltd [2005] HCA 45, 79 ALJR 1503 at 1508 [29].
52 Justice Giles' view that there is a harmonious relationship between ss.54A and 23C appears from the following passage in Baloglow at 20,575 [162]: [162] … It has its own requirement of writing, less stringent than the requirement in s23C in that a note or memorandum of the agreement is sufficient and the signing agent need not be authorised in writing. [Section 23C] arises at the stage of performance of an agreement or where there is no prior agreement, and in keeping with the importance attached to property rights has a more stringent requirement of writing in that the creative or dispositive instrument itself must be in writing and the signing agent must be authorised in writing. S54A excepts the operation of the law relating to part performance, material to an executory agreement, while s23C excepts the operation of the law relating to trusts, material to property rights. S23C is in a Part of the Conveyancing Act dealing with property and a Division of that Part dealing with assurances, and otherwise concentrates on property rights, see s23C(1)(b) dealing with declarations of trust and s23C(1)(c) dealing with disposition of subsisting equitable interests. There is no encouragement in its language to make it apply to executory agreements under which property rights are to be created or disposed of when the agreement is performed.
53 In my view Baloglow establishes that s.23C does not apply at all - whether as to creation or as to disposition of an interest - if there is no more than an agreement to assure property in the future: see Giles JA at [191] and Mason P at [3]. I think it appears from para [112] that Priestley JA was of a similar view.
54 Upon the present facts, it is in my opinion that both ss.54A and 23C(1)(a) operate to prevent enforcement of the agreement as found unless enforcement is available under the doctrine of part performance. Paragraphs (b) and (c) of s.23C(1) do not operate on the agreement as found.
55 There were discussion and argument on whether the apposition of paras (a), (b) and (c) of s.23C(1) produces anomalies. I regard it as unproductive to look for a rationale of these paragraphs in which they operate exhaustively and deal with distinct subjects with no overlap; it could well be that para (b) deals, where there is a declaration of trust, with interests which would otherwise fall within para (a), and creates a requirement for writing in different terms to the requirement which para (a) would otherwise impose where an interest in land is created by a declaration of trust. As there is nothing which could be thought to be a written declaration of trust in the present case this does not need to be pursued.
56 On behalf of the appellants it was contended that Adamson v Hayes (1973) 130 CLR 276 is authority binding the Court of Appeal to hold that s.23C of the Conveyancing Act applies to a contract to declare a trust. While there was a majority in the High Court in favour of the view that the Western Australian legislation corresponding to s.23C was applicable to the pooling arrangement there under consideration, there was no majority establishing which of paras (a), (b) or (c) was applicable, and the pooling arrangement was altogether unlike the agreement now under consideration. In my respectful opinion the diversity of views in Adamson v Hayes means that that decision is not a binding authority. It does not deal with an agreement to declare a trust in the future and could not establish whether s.23C would apply if the agreement in the present case had the character which the Trial Judge spoke of it as having.
57 The respondent's counsel based several submissions on the view that the Trial Judge had made findings of fact in Judgment [46] and [49], but I do not deal with them in detail as they lack a basis. These included a contention to the effect that as Bechara performed his obligations under the agreement and paid the consideration Peter held his share in the property on a constructive trust for Bechara. It was then contended that if Peter held his share in the property as a constructive trustee for Bechara there was no room for the operation of s.23C(1) having regard to s.23C(2). I will not examine this argument further; it could well be right but would not overcome s.54A; and in any event it is not well based on the terms of the agreement as found.
58 The appellants' claim that s.54A applies is not supported by the definition of inclusion of "disposition". It is not in my opinion a correct process of construction to treat the definition of inclusion as supporting implications that transactions of kinds referred to in the definition of inclusion are impliedly excluded from references to "disposition" into which they would otherwise fall if they do not accord with the reference to them in the definition of inclusion; for example, that declarations of trust, disclaimers and releases which are not by instrument or appointments of property which are not contained in a will should be impliedly excluded although they would otherwise fall within a reference to "disposition". This is not what definitions of inclusions do, or what they are meant to do.
59 It was contended on behalf of Bechara (Orange 25 Written Submissions 24) that: 24. Looking beyond the wording of the definition, the Appellants' construction would play havoc with the accepted meaning and operation of s.23C of the Act. If "disposed of" in s.23C(1)(a) were to include, by definition, a declaration of trust other than by instrument, then s.23C(1)(a) would require all declarations of trust to comply with its requirements, contrary to what has been held to be the correct position in Secretary , Department of Social Security v James (1990) 95 ALR 615, Hagan v Waterhouse (1992) 34 NSWLR 308, Di Pietro v Official Trustee in Bankruptcy (1995) 59 FCR 470 and ISPT Nominees Pty Ltd v Chief Commissioner of State Revenue (2003) 53 ATR 527. Those decisions hold that s.23C(1)(a) does not apply to declarations of trust of land, so that s.23C(1)(b) is to be seen neither as otiose nor as imposing requirements additional to s.23C(1)(a). Similarly, if a "disposition" in s.23C(1)(c) included, by definition, a declaration of trust other than by instrument, then paragraph (b) would have to be regarded either as otiose or as imposing additional requirements to paragraph (c).
60 As ss.23C and 54A operate differently, and may according to circumstances and usually will operate at different points in a series of events, there is no reason to reject a construction of an expression in one section on the ground that it would not, if applied to the other, operate in a harmonious way. The circumstances that ss.23C and 54A and the definitions of "disposition" and "assurance" were all inserted in the Conveyancing Act by the same Conveyancing (Amendment) Act 1930, and that they had predecessors in the Law of Property Act 1925 (UK) and in the Statute of Frauds, do not require that a construction be rejected if would not be altogether harmonious if applied to both sections. Each of the provisions carries with it some marks of the predecessor legislation, reflected, for example, in the differing requirements about what the writing is to be and who may make it and when, in paras (a), (b) and (c) of ss.23C(1) and 54A(1). On literal meaning, dispositions affected by para (c) would include dispositions of land already affected by para (a), and declarations of trust affected by para (b) would cover some of the ground which would otherwise be covered by para (a). Anomalies and apparent anomalies among paras (a), (b) and (c) can probably be resolved, when it is necessary to do so, by giving primacy to a provision which deals specially with some situation, or by reading down what would otherwise be the natural reading of one provision to accommodate another, if it is thought unlikely that it was intended that more than one of them would apply to any particular case. Resolution of anomalies and uneven incidence of provisions of s.54A with provisions of s.23C(1) do not have the same claim for consideration as giving effect to what is indicated and delimited by the natural meaning of those sections.
61 It is correct that it has been held that s.23C(1)(a) does not require all declarations of trust to comply with its requirements; in my understanding the basis on which this is so is that the provisions of para (b) dealing specially with declarations of trust have been given primacy. In Secretary, Department of Social Security v James (1990) 95 ALR 615 at pages 621-622 Lee J. reviewed authorities and texts, and said (at 622): Authors of texts on trusts and equity have also contended that s 34(1)(a), or its equivalent, does not extend to the equitable interest in land created by a declaration of trust referred to in s 34(1)(b): Meagher, Gummow and Lehane, Equity Doctrines and Remedies 2nd ed, 1983, para 706; Ford and Lee, para 606; but cf Jacobs, Law of Trusts in Australia , 5th ed, para 705.
In my view, the proper construction of s 34(1)(a) and 34(1)(b) does not require a declaration of a trust in land to be treated as a special class of equitable interest only capable of being created in writing and further, to be manifested and proved by writing signed by the declarant. Section 34(1)(b) would be either an odd exception, or otiose, if s 34(1)(a) were to be construed as including the declarations of trust in respect of land specifically provided for in s 34(1)(b). In Hagan v Waterhouse (1991) 34 NSWLR 308 at 385-386 Kearney J, adopting the analysis of Lee J. in Secretary, Department of Social Security v James , concluded that para (b) operates independently of and unaffected by para (a) and did not adopt a view in which it was necessary to comply with both paras (a) and (b).
62 It is not correct, in my opinion, to conclude that including the agreement as found within "any contract for the sale or other disposition of land or any interest in land" in s.54A makes s.23C unworkable. It was conceded by counsel for the respondent that the natural reading of the defined meaning of "disposition" in s.7(1) means that that definition is inapplicable to s. 23C; a view found in Meagher, Gummow, Lehane's Equity Doctrines and Remedies fourth edition, 2002 at pages 289-90 [7-015]. Counsel observed that the defined meanings apply "unless the context or subject-matter otherwise indicates or requires". This observation did not assist his argument. Counsel pointed to the absence of "disposition" and its derivatives in para (b), contrasted with the presence of "disposition" or a derivative in paras (a) and (c) in support of the contention that a declaration of trust is not, in the language of those provisions, a disposition. I do not think that this argument is of substance. Overall, I do not think that the use of the word "disposition" and its derivatives in s.54A is inconsistent with their use in s.23C.
63 The result for which the respondent contends, in which the successor provisions to the Statute of Frauds do not control an oral contract containing a promise to declare a trust over land, where the declaration is to be made in the future, would be a markedly anomalous exception to the scheme of requirements for writing which ss.23C and 54A creates, and no purpose which such an exception could have been intended to serve has been suggested. The circumstance that the requirements for writing in para (b) are less stringent than other requirements for writing does not assist this reading. Indeed they are not less stringent in all respects, as there is no reference to an agent. Argument that a reading of s.54A so as not to require writing is assisted by an absence of the requirement for writing in s.23C does not have the suggested basis in s.23C, but if it did, it would not have a basis of logic.
64 Justice Barrett also stated his views on part performance, although his Honour did not regard it necessary for Bechara to rely on part performance. The acts of part performance which his Honour considered were payments. Under the agreement Bechara was to pay Peter $30,000 initially. The Trial Judge found that this payment was made in 1992, and that it was an act of part performance. It was also a term of the agreement that Bechara was to pay Peter's share of instalments under the Commonwealth Bank loan under which Peter and Marina were borrowers. The Trial Judge found that there was a subsequent payment referred to as a payment of $70,000 to Bishop Gibran Rimlawi for application in reduction of the Commonwealth Bank loan. The Trial Judge treated this payment as an act of part performance.
65 Marina and Peter borrowed part of the purchase money from the Commonwealth Bank secured by a mortgage over the house when they purchased the property. The purchase price was $135,000 and the parties' parents contributed money to the purchase price which is presumed to be an advancement to their son and daughter. No finding establishes how much the parents contributed; it was either $24,000 or $30,000. No finding establishes how much money was borrowed from the Commonwealth Bank, or how much money was owing to the Bank at the time of the agreement between Peter and Bechara in 1992. No doubt Peter and Marina were each liable to the Bank for the whole mortgage debt but there is no difficulty in recognising Peter's share of instalments, referred to in the agreement as found, as half the instalments. No finding establishes what the instalments were, or for how long they were to extend. The agreement did not relate to payment of the mortgage by one payment, or otherwise than by paying a share of the instalments. These things mean that it was Bechara's contractual obligation to pay half the instalments, and to make the payments to the Commonwealth Bank.
66 In 1992 Bishop Gibran Rimlawi was the Bishop of the Antiochan Orthodox Diocese of Australia and the leader of that church in Australia, and he continued to be until he died in January 1999. He was on terms of personal friendship with members of the Khoury family, and one of the brothers, Elias, was a priest of the Church and worked closely with the Bishop. The Bishop habitually provided financial assistance to members of the Church community whom he considered to be in need of it. In early 1992 (and it would seem before the agreement between Bechara and Peter) the Bishop gave Mr Bruce Rowan, a bank manager, a document in an envelope and instructed Mr Rowan not to open it "unless something happens to me". The document purports to be the Bishop's will dated 28 March 1992, although it is not executed according to required formalities. It includes a list of his assets. In this list para (k) is (Judgment [12] Red 22): k).- With Marina H. Khoury the sum of Twenty thousand dollars ($20,000-) to be paid at her convenience, and if needs be to be forfeited, as the Trustee Executor will determine. No Charges. Paragraph (k) appears to say, not completely clearly, that the Bishop had deposited $20,000 with Marina or lent it to her. Paragraph (l) is (Judgment [12] Red 22): l).- Half of the house on 93 Johnston, Bass Hill, where live the family of the priest Fr, Elais Khoury, the owner of the other half is Bechara Khoury. This house is still in the name of Marina and Peter her brother, but there is a certificate from her testifying that I paid her the price of half the property, and kept it in her name so we can save the exchange of Title. Marina and Bechara and Bruce Rowa [sic] know the truth of the matter. In this way the Bishop stated that on 28 March 1992 Bechara already owned half of the house and that the Bishop owned the other half; but did not state how these results came about, or how the Bishop knew them. The Trial Judge had regard to this document in the reasoning which led to acceptance of Bechara's evidence of the agreement.
67 The Trial Judge made these findings about performance of the promise to pay Peter's share of the instalments under the Commonwealth Bank loan (Judgment [28] to [30] Red 28-29): 28. In relation to the loan repayments the facts are more complicated. Bechara says that in 1992 a separate agreement was struck between Bishop Rimlawi and Marina by which Marina assigned her share in the property to the bishop in return for the bishop paying her $70,000 and undertaking to honour Marina's obligations under the load. Marina was in financial difficulties at the time. No transfer was executed. Bechara says that from this time onwards the bishop took over the responsibility of making all loan repayments to the Commonwealth Bank.
68 After reviewing evidence relating to an agreement between the Bishop and Marina the Trial Judge found (Judgment [38] to [39] Red 32): 38. On the balance of probabilities, I find that the bishop and Marina did enter into an agreement in 1992 under which it was intended that the bishop acquire Marina's interest in the property in exchange for $70,000 and the bishop's promise to meet all of Marina's responsibilities under the Commonwealth Bank loan.
Did Bechara pay the bishop his portion of the loan repayments?
69 The Trial Judge then reviewed evidence in which Bechara said that, over the next few years after making his arrangement with the Bishop, he paid an amount of about $70,000 to Bishop Rimlawi "as we had agreed" (Judgment [40] Red 33).
70 The Trial Judge then reviewed evidence bearing on this, which showed among other things that the Commonwealth Bank loan was reduced from $118,000 to $56,000 between 1992 and 1996 (which is at the rate of $14,000 per annum), and that the then outstanding balance was paid out of loan moneys obtained by Marina and her husband from the Arab Bank. Peter was guarantor of the loan and joined Marina in giving the Arab Bank a mortgage over the Bass Hill house as security for the loan. During the period 1992 to 1996 Peter did not make any payments to the Commonwealth Bank on account of the loan, nor did Bechara himself. The Trial Judge's conclusions are in Judgment [44] and [45] (Red 34-35): 44. … Bechara's promise (to protect Peter against loan obligations) had been fulfilled. While it is not absolutely certain that Bechara actually made these repayments, that is the most logical conclusion. If it were otherwise, why would Marina repay the balance of the Commonwealth Bank loan out of moneys borrowed from the Arab Bank by herself and her husband? The strong inference is that Bechara made payments to the bishop who then applied them in reducing the Commonwealth Bank loan.
71 The Trial Judge's reasoning in Judgment [44] cannot be followed, and cannot be reconciled with Judgment [38] and para (l) of the Bishop's will, the basis of which appears to be that the Bishop had bought Marina's share of the house in 1992 and paid her $70,000 for it and was to meet all her responsibilities under the Commonwealth Bank loan from then on. Further, the fact that Marina repaid the balance of the Commonwealth Bank loan in 1996 does not support an inference that the Bishop had applied money paid to him by Bechara to reducing the Commonwealth Bank loan. However the finding in Judgment [45] is not challenged on appeal and must be brought under consideration in addressing part performance.
72 The money borrowed from the Arab Bank by Marina and her husband was used in part to satisfy the outstanding balance of the mortgage loan from the Commonwealth Bank, and as to $72,536.44 in payment in September 1996 to the Bishop's relief fund, and this payment was referred to by Marina's solicitor when forwarding the cheque as "your loan monies". The Trial Judge accepted that there was not a loan from the Bishop to Marina, and the payment of $72,536.44 was not a repayment of the loan, but that the transaction was, consistently with the Bishop's will, an agreement for sale of Marina's interests to the Bishop, and the payment in September 1996 was her payment of the price of her repurchase of the interest she had sold to the Bishop; see Judgment [34] to [38]. It was not suggested in argument that these complexities had a bearing on Bechara's entitlement to the order made by Barrett J.
73 An account of the doctrine of part performance and its history is given in Ch.7 of "The Statute of Frauds Section Four in the Light of its Judicial Interpretation", James Williams, Cambridge 1932. Case law discussed by Dr Williams shows that part performance was treated as a ground for specific performance in 1686, 10 years after the enactment of Statute of Frauds (Butcher v Stapely (1685) 1 Vernon 363, 23 ER 524), and was relied on in several cases early in the 18th century. In Gunter v Halsey (1739) Ambler 586, 27 ER 381 Lord Hardwicke LC stated the conditions on which the Court acted: … where the acts have been such as would be a prejudice to the party who has done them, if after that the agreement was to be void. ... As to the acts done in performance, they must be such as could be done with no other view or design than to perform the agreement: and said, in this case it did not appear the terms of the agreement should be certainly proved.
74 Part Performance as a ground for a decree for specific performance was already known to Equity lawyers before the Statute of Frauds was enacted. Lord Nottingham, who was Lord Chancellor when the Statute of Frauds took effect on 24 June 1677, said, in Ch 27 Of Agreements of his Prolegomena of Chancery and Equity (Cambridge, 1965) at 310: 2 A suit may be commenced in Chancery to have execution of articles of agreement or covenants in deed, because though there be remedy in law in damages, yet possibly the performance of the thing in specie is more desirable.
3 But equity will never compel the performance of a parol agreement in specie , unless it have been in part executed or executed on one side. In Lord Nottingham's terminology a written agreement not being a deed is a parol agreement (as is an oral agreement): see his para 1 at 309; and specific performance of a parol agreement was not available unless there had been performance by one side, or part performance. Lord Nottingham was not stating the effect of the Statute of Frauds and the passage was probably written before it was enacted. He continued to be Lord Chancellor until 1682, but is not known to have given a decision on the effect of Part Performance on the operation of the Statute of Frauds . See commentary by D.E.C. Yale at pages cii and ciii in the Introduction to Lord Nottingham's Chancery Cases Volume 1 (Selden Society 1957), where examples are given at Note 3 of cases earlier than 1677 where part performance was considered. The first reported decision which associates part performance with the Statute of Frauds is Butcher v Stapely where Jeffreys LC (whose place in history does not arise from a reputation as an Equity lawyer) seems to have treated the association as obvious.
75 The judicial approach to the meaning and effect of the Statute of Frauds may well have been influenced by the recital with which it opens: "For prevention of many fraudulent practices, which are commonly endeavoured to be upheld by perjury and subornation of perjury; (2) be it enacted …". This recital establishes the purpose of the Statute clearly, and could support the view that if evidence shows that the transaction is genuine in some other way than by writing, the Statute was not intended to apply to it. If this was part of the reasoning of Seventeenth-Century Chancery judges, they are not known to have articulated it.
76 In Last v Rosenfeld [1972] 2 NSWLR 923 at 927 Hope J gave this account, which has the evident approval of the High Court in Theodore v Mistford Pty Ltd (2005) 221 CLR 612 at 623-624: No sooner had the Statute of Frauds been enacted in 1677 than the courts set about relieving persons of its effect in cases where it was thought that the legislation could not have been intended to apply. In general terms, it was said that the courts would not allow the Statute of Frauds to be made an instrument of fraud, and that it did not prevent the proof of the fraud. No doubt, as was said by Selborne LC in Maddison v Alderson (1883) 8 App. Cas. 467, at p.474 in relation to one of the principles that was developed in this way, namely, the doctrine of part performance, this summary way of stating the principle, however true it may be when properly understood, is not an adequate explanation, either of the precise grounds, or of the established limits, of the relevant doctrine. The general approach indicated by this summary statement did, however, spread into a number of fields where a statute requires writing, ...
77 The modern foundation of the doctrine is the decision of the House of Lords in Maddison v Alderson (1883) 8 App Cas 467. The speech of Lord Selborne LC has become a starting point for later consideration. His Lordship's speech includes these observations (at 474-476): The cases upon this subject (which are very numerous) have all, or nearly all, arisen under those words of the 4th section of the Statute of Frauds, which provide that "no action shall be brought to charge any person upon any contract or sale of lands, tenements, or hereditaments, or any interest in or concerning them, unless the agreement upon which such action shall be brought, or some memorandum or note thereof, shall be in writing, and signed by the party to be charged therewith, or some other person thereunto by him lawfully authorized." … That equity has been stated by high authority to rest upon the principle of fraud: "Courts of Equity will not permit the statute to be made an instrument of fraud". By this it cannot be meant that equity will relieve against a public statute of general policy in cases admitted to fall within it; and I agree with an observation made by Lord Justice Cotton, in Britain v. Rossiter 11 Q.B.D. 130, that this summary way of stating the principle (however true it may be when properly understood) is not an adequate explanation, either of the precise grounds, or of the established limits, of the equitable doctrine of part performance. In a suit founded on such part performance, the defendant is really "charged" upon the equities resulting from the acts done in execution of the contract, and not (within the meaning of the statute) upon the contract itself. If such equities were excluded, injustice of a kind which the statute cannot be thought to have had in contemplation would follow. Let the case be supposed of a parol contract to sell land, completely performed on both sides, as to everything except conveyance ; the whole purchase-money paid ; the purchaser put into possession ; expenditure by him (say in costly buildings) upon the property ; leases granted by him to tenants. The contract is not a nullity ; there is nothing in the statute to estop any Court which may have to exercise jurisdiction in the matter from inquiring into and taking notice of the truth of the facts. All the acts done must be referred to the actual contract, which is the measure and test of their legal and equitable character and consequences. If, therefore, in such a case a conveyance were refused, and an action of ejectment brought by the vendor or his heir against the purchase, nothing could be done towards ascertaining and adjusting the equitable rights and liabilities of the parties, without taking the contract into account. The matter has advanced beyond the stage of contract ; and the equities which arise out of the stage which it has reached cannot be administered unless the contract is regarded. The choice is between undoing what has been done (which is not always possible, or, if possible, just) and completing what has been left undone. The line may not always be capable of being so clearly drawn as in the case which I have supposed ; but it is not arbitrary or unreasonable to hold that when the statute says that no action is to be brought to charge any person upon a contract concerning land, it has in view the simple case in which he is charged upon the contract only, and not that in which there are equities resulting from res gestae subsequent to and arising out of the contract. So long as the connection of those res gestae with the alleged contract does not depend upon mere parol testimony, but is reasonably to be inferred from the res gestae themselves, justice seems to require some such limitation of the scope of the statute, which might otherwise interpose an obstacle even to the rectification of material errors, however clearly proved, in an executed conveyance, founded upon an unsigned agreement. While extensively reviewing case law Lord Selborne said (at 478): The doctrine, however, so established has been confined by judges of the greatest authority within limits intended to prevent a recurrence of the mischief which the statute was passed to suppress. The present case, resting entirely upon the parol evidence of one of the parties to the transaction, after the death of the other, forcibly illustrates the wisdom of the rule, which requires some evidentia rei to connect the alleged part performance with the alleged agreement. There is not otherwise enough in the situation in which the parties are found to raise questions which may not be solved without recourse to equity. It is not enough that an act done should be a condition of, or good consideration for, a contract, unless it is, as between the parties, such a part execution as to change their relative positions as to the subject-matter of the contract. … it may be taken as now settled that part payment of purchase-money is not enough ; and judges of high authority have said the same even of payment in full: Clinan v. Cooke 1 Sch. & Lef. 40 ; Hughes v. Morris 2 D.M. & G. 356 ; Britain v. Rossiter 11 Q.B.D. 123. Some of the reasons which have been given for that conclusion are not satisfactory ; the best explanation of it seems to be, that the payment of money is an equivocal act, not (in itself), until the connection is established by parol testimony, indicative of a contract concerning land. I am not aware of any case in which the whole purchase-money has been paid without delivery of possession, nor is such a case at all likely to happen. All the authorities [show] that the acts relied upon as part performance must be unequivocally, and in their own nature, referable to some such agreement as that alleged : Cooth v. Jackson 6 Ves. 38 ; Frame v. Dawson 14 Ves. 386 ; Morphett v. Jones 1 Sw. 181. "The acknowledged possession" (said Sir T. Plumer in Morphett v. Jones 1 Sw. 181) "of a stranger in the land of another is not explicable, except on the supposition of an agreement, and has therefore constantly been received as evidence of an antecedent contract, and as sufficient to authorize an inquiry into the terms, the Court regarding what has been done as a consequence of contract or tenure." "It is in general," said Sir James Wigram ( Dale v. Hamilton 5 Hare, 381) of the essence of such an act that the Court shall, by reason of the act itself, without knowing whether there was an agreement or not, find the parties unequivocally in a position different from that which, according to their legal rights, they would be in if there were no contract ….. But an act which though in truth done in pursuance of a contract, admits of explanation without supposing a contract, is not in general admitted to constitute an act of part performance taking the case out of the Statute of Frauds ; as for example, the payment of a sum of money alleged to be purchase-money. The fraud, in a moral point of view, may be as great in the one case as in the other, but in the latter cases the Court does not in general give relief": (see also Britain v. Rossiter 11 Q.B.D. at p.130, per Lord Justice Cotton.) The acts of part performance, exemplified in the long series of decided cases in which parol contracts concerning land have been enforced, have been (almost, if not quite, universally) relative to the possession, use, or tenure of the land. The law of equitable mortgage by deposit of title deeds depends upon the same principles.
78 Lord Selborne reviewed many of the very numerous cases on part performance. They show that judicial opinion has not been completely uniform but from the earliest times there was unreadiness to give the Statute of Frauds its full literal effect. The readiness of the Court to give effect to equities arising upon conduct in performance of the contract does not provide a full or satisfactory exposition of unreadiness to treat part payment of the purchase money as an act of part performance; but as recognised by Lord Selborne that attitude to part payment was as well established by judicial authority as the doctrine of part performance itself.
79 The speeches of Lords O'Hagan, Blackburn and FitzGerald have not had the same influence on later law as that of Lord Selborne; they contain statements which if anything are more stringent. Lord O'Hagan stated the requirement of unequivocal reference to the agreement much more stringently than Lord Selborne; at 485 Lord O'Hagan said "But there is no conflict of judicial opinion, and in my mind no ground for reasonable controversy as to the essential character of the act which shall amount to a part performance, in one particular. It must be unequivocal. It must have relation to the one agreement relied upon, and to no other. It must be such, in Lord Hardwicke's words (2 Ambler 587), 'as could be done with no other view or design than to perform that agreement.' It must be sufficient of itself, and without any other information or evidence, to satisfy a Court, from the circumstances it has created and the relations it has formed, that they are only consistent with the assumption of the existence of a contract the terms of which equity requires, if possible, to be ascertained and enforced."
80 Consideration of part performance in the High Court of Australia has not produced any relaxation or departure from Maddison v Alderson. In McBride v Sandland (1918) 25 CLR 69 at 78-79 Isaacs and Rich JJ made a statement of the elements of part performance to raise the equity. Isaacs and Rich JJ said at 79: (4) It must have been in fact done by the party relying on it on the faith of the agreement, and further the other party must have permitted it to be done on that footing. This is a very stringent requirement. Their Honours also said that it remained to be shown (7) That the act was done under the terms of that agreement by force of that agreement ( Thynne v Glengall 2 H.L.C. 131, at p.158).
81 Their Honours did not refer to the standing of part payment as an act of part performance, as their consideration was limited to the facts of that case.
82 The High Court again considered part performance in Cooney v Burns (1922) 30 CLR 216, where there was not in fact a payment. Knox CJ said at 222-223 "It is settled that payment of part of the purchase-money is not of itself and apart from other circumstances - e.g., delivery of possession - a sufficient act of part performance to take a case out of the statute (Fry on Specific Performance, sec. 613)."
83 In JC Williamson Ltd v Lukey & Mulholland (1931) 45 CLR 282, which related to an oral agreement for a five-year lease, the decision did not turn solely on part performance, but also involved suitability of the agreement for specific performance. Dixon J. said at 297 "Equitable relief is obtainable, notwithstanding the Statute of Frauds, by a party who in pursuance of his contract has done acts of performance consistent only with some such contract subsisting …" and this appears to allude to Lord Selborne in Maddison v Alderson. Dixon J. also said at 300 "The acts of part performance must be such as to be consistent only with the existence of a contract between the parties, and to have been done in actual performance of that which in fact existed." See too Evatt J. at 308-309, McTiernan J. at 317.
84 Regent v Millett (1976) 133 CLR 679 was a case in which the vendor in an oral contract for sale permitted the purchaser to take possession, and this was treated as an act of part performance, although there was no contractual obligation to take possession. Justice Gibbs, in an ex tempore judgment with which other members of the Court agreed, said (at 682-683): ... it was submitted that a narrower test should be adopted and that it was necessary to establish "such a performance as must necessarily imply the existence of the contract" - to use the words of Lord O'Hagan in Maddison v Alderson (1883) 8 App. Cas. 467, at p.483. However, the test suggested by the Earl of Selborne LC in that case ((1888) 8 App. Cas. at p.479), that the acts relied upon as part performance "must be unequivocally, and in their own nature, referable to some such agreement as that alleged", has been consistently accepted as a correct statement of the law. It is enough that the acts are unequivocally and in their own nature referable to some contract of the general nature of that alleged (see McBride v Sandland (1918) 25 C.L.R. 69, at p.78).
85 Justice Gibbs also adopted an expression in Dr. Williams' text at 256 "The change of possession of land has been described as 'the act of part performance par excellence'."
86 In Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 at 432 Brennan J. said: In order that acts may be relied on as part performance of an unwritten contract, they must be done under the terms and by force of that contract and they must be unequivocally and in their nature referable to some contract of the general nature of that alleged: Regent v Millett (1976) 133 CLR 679, at 683. The acts which were held to amount to part performance were done by the Mahers to develop their own property, and the development was clearly for a commercial purpose. But, in my respectful opinion, those acts are not unequivocally and in their nature referable to an agreement for the lease of the Mahers' land. This passage is a restatement in classic terms of a formulation which has been repeatedly approved in the High Court, and has not received any disapprobation.
87 In Steadman v Steadman [1976] AC 536 the House of Lords, in a case about a complicated agreement for settlement of maintenance and property disputes between husband and wife, treated a payment of £100 arrears of maintenance, which was required by a term of the agreement, as an act of part performance so as to enable specific enforcement of another term under which the wife was to surrender her interest in the matrimonial home for another payment of money which had not been made. Law Lords in the majority expressed dissatisfaction with the general rule that payment of money cannot constitute an act of part performance of a parol contract for disposition of an interest in land. Lord Reid said (at 541): Normally the consideration for the purchase of land is a sum of money and there are statements that a sum of money can never be treated as part performance. Such statements would be reasonable if the person pleading the statute tendered repayment of any part of the price which he had received and was able thus to make restitutio in integrum. That would remove any 'fraud' or any equity on which the purchaser could properly rely. But to make a general rule that payment of money can never be part performance would seem to me to defeat the whole purpose of the doctrine and I do not think that we are compelled by authority to do that. Lord Simon of Glaisdale said (at 565) that the reasons for the rule did not justify it "as framed so absolutely." Lord Salmon (at 570) was of the view that payments may be "acts from which the nature of the contract can be deduced", while saying "It is no doubt true that often it is impossible to deduce even the existence of any contract from payment … Nevertheless the circumstances surrounding a payment may be such that the payment becomes evidence not only of the existence of the contract under which it was made but also of the nature of that contract. What the payment proves in the light of its [surrounding] circumstances is not a matter of law but a matter of fact." Viscount Dilhorne said (at 555), that his Lordship found it difficult to say on what principle the conclusion excluding payments of money from part performance had been reached. Lord Morris of Borth-Y-Gest dissented. Later legislative changes in the United Kingdom seem to make it unlikely that the House of Lords will again consider such a question.
88 In Australian and New Zealand Banking Group Ltd v Widin (1990) 26 FCR 21 the Full Court of the Federal Court of Australia applying the Conveyancing Act treated part performance as authoritatively expounded in Maddison v Alderson and was of the view that there were acts of part performance in that case without resort to treating payment as an act of part performance. Justice Hill made an extremely comprehensive review and concluded at 37 "It may be possible to reconcile what is said in Steadman with the orthodox approach taken by the High Court to date and while there is much to be said for the adoption in Australia of Steadman, these are matters for the High Court rather than an intermediate Court of Appeal."
89 I take the same view. In the present case there are no acts of ownership such as taking possession, paying rates or paying for the upkeep or improvement of the property, or receipt of rent or profits, or any other act at all. Acts of part performance have been almost universally closely related to possession and use or tenure of the land itself, such as where a purchaser is put into possession by the vendor, or allowed to take possession by the vendor, or where the purchaser carries out improvements. They have not necessarily been acts which the contract requires to be done. Acts on the land can much more readily be seen as unequivocally referable to the contract than payments of money. The anomaly of not recognising payment as an act of part performance is clear, and for example was recognised by the Court of Appeal in Britain v Rossiter at 131 (Cotton LJ), in clear terms available to Lord Selborne in Maddison v Alderson.
90 The whole law of part performance is established by judicial authority, and discerning underlying principle is an obscure process. The existence of the doctrine of part performance is expressly recognised in the terms of the Conveyancing Act, not only in relation to s.54A which is the successor to s.4 of the Statute of Frauds, but also in relation to s.23C, which is the successor of provisions in relation to which part performance appears to have been little discussed, if discussed at all. Part performance of a contract is a subject relating to enforcement of contracts such as s.54A deals with, and less readily can be seen as a subject relating to the effectiveness of assurances; yet if an assurance was given under a contract there seems to be room to remedy any defect by specific performance, and hence for the operation of doctrine of part performance in relation to s.23C. Unless authoritatively directed to do otherwise, my view is that the Court of Appeal should apply the doctrine of part performance as it has received it, according to the terms in which it has been recognised in decisions of the High Court of Australia. The unavailability of payments as acts of part performance is part of what has been so received.
91 Payment may be relevant for other reasons yet not be treated as an act of part performance for the operation of s.54A. It is always necessary to prove the terms of the oral agreement, and the acts done in relation to the contract and its performance, including all payments made, can be put in evidence to show that there was an oral agreement as well as to show that there has been part performance. Payments are also relevant as part of the material upon which the Court is to act in deciding to award specific performance, which has a discretionary element, and is done in a way which resolves the whole controversy and sees to performance of outstanding obligations of each party.
92 Observations in Steadman v Steadman disapproving of excluding payments as acts of part performance are not altogether uniform. If the observations of Lord Salmon at 570 are applied, it cannot, in my opinion, be said that the series of payments to the Bishop are evidence either of the existence of the contract between Bechara and Peter, or of the nature of that contract. On no view was the arrangement between Bechara and the Bishop and the series of payments referable, let alone unequivocally referable, to the agreement between Bechara and Peter. That agreement required Bechara to do something quite different, to pay the instalments to the Commonwealth Bank, not to rely on a different arrangement which he made with the Bishop and to act on that other arrangement; and no less so if the fact is, as the Trial Judge inferred, that the Bishop did things which brought about the same result as performance of the contract would have done. Whether or not payments could qualify as acts of part performance, these payments to the Bishop, and the arrangement with the Bishop for the Bishop to pay the instalments, have no claim at all for consideration as acts unequivocally referable to the contract as found or to a transaction of that kind. However that leaves the payment of the $30,000 for consideration; if there were no rule excluding payments, this payment would seem to fulfil every requirement for an act of part performance. As the law is, neither can be regarded, and s.54A stands in the way of Bechara's obtaining any relief in judicial proceedings, whether the declaratory order which he obtained, or any other relief.
93 In my opinion the Court of Appeal should make these orders: (1) Allow the appeal with costs: (2) Set aside the declaration and orders of Barrett J. of 20 November 2004 and in lieu thereof order: The proceedings are dismissed with costs. (3) The respondent is to have a certificate under the Suitors Fund Act.
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.
KHOURY & ANOR
KHOURI
[2005] HCA 45
(1984) 6 FCR 277
(1973) 130 CLR 276
(1990) 26 FCR 21
(1922) 30 CLR 216
(1991) 34 NSWLR 308
(1931) 45 CLR 282
(1918) 25 CLR 69
(1976) 133 CLR 679
(1990) 95 ALR 615
(2005) 221 CLR 612
(1988) 164 CLR 387
(1919) 26 CLR 249
(1944) 69 CLR 131
(1982) 149 CLR 491
(1992) 34 NSWLR 308
(1995) 59 FCR 470