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[2026] NSWCA 27
respondent. Appeal dismissed. The appellant is to pay the respondent’s costs: [65].
MPI paid or arranged costs for a subdivision that created lots for several neighbouring landowners, including PMG. The written Land Swap Deed dealt with land transfers and specified costs, but did not say PMG had to pay a share of the broader subdivision costs. MPI could not prove that PMG had asked it to incur those costs. The Court also did not decide whether accepting services without a request can itself justify restitution. It held that MPI had not shown that PMG should reasonably have known MPI expected payment, particularly because the Cauchis started and controlled the project and were its main beneficiaries. The appeal was dismissed.
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2,489 words · generated 08/10/2026
The dispute arose from a proposed subdivision at Box Hill involving land associated with the Cauchi, Galea and Polistina parties. The Cauchis began planning a subdivision of their own land in early 2018. Before Mr Cauchi approached Mr Galea about including the Galea Property, the Cauchis had appointed MPI as principal contractor and engaged project-management services: [3], [13]. The project therefore began as a Cauchis-led development, rather than as a joint project formed by all landowners from the outset.
4 cited instruments linked from this judgment.
The subdivision proposal later incorporated parts of the Galea and Polistina properties. Council granted development consent in April 2019, and the consent was subsequently modified. The approved subdivision ultimately provided for 50 residential lots. The Cauchi parties owned 40 of those lots, PMG owned four, and the remaining lots were associated with the Polistina parties: [4], [16]. The consent conditions required infrastructure works and substantial contributions, including a special infrastructure contribution and a payment of $1,920,000 under s 7.11 of the Environmental Planning and Assessment Act 1979 (NSW): [17].
The Cauchis and PMG negotiated a Land Swap Deed because some proposed lots crossed the boundary between their properties. The deed dealt with transfers of land to ensure the affected lots would be owned by one party or the other after registration. It also assigned specified costs and works to each party, including responsibilities relating to identified lots: [20]-[22]. MPI was not a party. The deed did not set out a general obligation for PMG to contribute to the costs MPI later claimed for satisfying subdivision consent conditions. It included a whole-agreement clause, cl 8.6: [19], [23].
MPI incurred or arranged costs associated with the subdivision. In March 2022, it invoiced PMG for $686,363.88, seeking reimbursement for a share of those costs: [6]. MPI’s claimed amounts used different allocation methods for different expense categories, including proportions based on land area, number of lots, or a proposed division between parties: [24], [55]. PMG denied that it had an obligation to pay.
At trial, MPI argued in contract, agency and restitution. On appeal, it pursued only restitution: [7]-[10]. It argued first that PMG had impliedly requested the works and payments, and second that PMG had freely accepted the benefits even if there had been no request: [10]-[11]. The Court of Appeal dismissed the appeal and ordered MPI to pay PMG’s costs: [65].
The Court treated the appeal as turning on evidence, not on a final resolution of the free-acceptance doctrine. It accepted that a restitution claim can be analysed by asking what benefit the defendant received, whether it was provided at the claimant’s expense, whether a recognised circumstance makes the provision unjust, and whether a defence applies. The Court cautioned that “unjustness” is not a general invitation to decide what seems unfair: the analysis proceeds by reference to recognised categories: [42].
The first route was an express or implied request. The Court described the principle that restitution may be available where work is performed at the recipient’s request as well established: [43]. But MPI could not establish a request by PMG. The Cauchis had initiated the development, appointed the contractors and project managers, and remained responsible for progressing the works and payments required by the consent conditions: [13], [52]. The project managers appear to have acted on the Cauchis’ instructions: [52]. The evidence did not establish that PMG had asked MPI, an entity the trial judge found PMG was not aware of, to undertake the disputed work: [40].
The second route depended on “free acceptance”. The Court described the uncertainty in Australian law about whether acceptance of a benefit, without a request, can itself provide the necessary unjust factor: [44]. Rather than decide that legal question, Free JA assumed for the purpose of analysis that the formulation MPI relied on could apply. On that formulation, MPI had to establish that a reasonable person in PMG’s position should have known MPI expected payment, and that PMG failed to take a reasonable opportunity to reject the services: [46]-[48].
MPI did not establish the necessary objective expectation. The Cauchis were the principal beneficiaries: they owned 80 per cent of the lots created. The Court considered that this distinguished the case from the typical situation in which the provider confers a benefit solely on someone else: [50]. The Court did not treat the provider’s own benefit as an automatic bar. Instead, it said that where the provider also benefits, particularly as the principal beneficiary, there needs to be a clear basis for finding that the recipient should have understood payment was expected: [51].
The Land Swap Deed and negotiations did not supply that basis. The deed addressed land transfers and specified works and costs but did not impose a contribution obligation for the disputed subdivision-wide expenses. MPI accepted on appeal that the deed did not deal with those costs: [26]-[27]. The contemporaneous email of 22 December 2020 described expectations about particular land, works and lot-related costs, but did not record an expectation that PMG would contribute to the wider costs MPI claimed: [18], [35], [59]. The evidence of a separate cost-sharing arrangement was weak. Mr Cauchi could not recall the relevant conversations, and the Court found no supporting documentary evidence: [30]-[34], [57]-[60].
The Court also considered the way MPI calculated its demand. The claimed proportions varied between expense categories, and MPI did not show that those allocation methods reflected an agreement or an expectation known to PMG: [55]. That variability reinforced the conclusion that the evidence did not establish an objectively apparent arrangement for PMG to pay the amounts claimed.
The judgment does not announce a final change in the law on free acceptance. Before the appeal, Australian authority was described as uncertain about whether free acceptance, without a request, is a recognised unjust factor. The Court referred to Hegarty v Keogh (No 2), LCM Operations Pty Ltd v Rabah Enterprises Pty Ltd, Atlanta Building Pty Ltd v Abdela (No 3), Lampson (Australia) Pty Ltd v Fortescue Metals Group Ltd (No 3), and Lumbers v W Cook Builders Pty Ltd (in liq): [44]. The judgment characterises those authorities as reflecting debate or uncertainty, rather than a settled rule that free acceptance is sufficient.
The Court restated the more established request-based route. Work done at the express or implied request of the recipient can support a restitution claim: [43]. The judgment relied on Lumbers and Lampson for that proposition. It also referred to the general analytical structure in Redland City Council v Kozik and the need to identify recognised categories of unjustness, rather than relying on abstract fairness: [42].
For the free-acceptance argument, the Court proceeded conditionally. It used the formulation requiring objective awareness that payment is expected and failure to take a reasonable opportunity to reject the service: [46]-[48]. It did not endorse that formulation as conclusively establishing the doctrine in Australian law. The decision therefore leaves the doctrinal question open. What it does provide is an application of the assumed test to facts involving a provider that was also the principal beneficiary.
The practical significance is evidential. Where the provider is itself advancing its own project and receiving most of the benefit, the judgment indicates that an expectation of payment by another participant cannot readily be inferred from benefit alone. The Court required a clear basis in the communications, arrangements or other circumstances for attributing that expectation to the recipient: [50]-[52]. That is an explanation of the Court’s reasoning in this case, not a declaration that free acceptance can never apply in a multi-party development.
At [42], Free JA explained that unjustness is “not a question of mere subjective perception of unfairness or injustice”. In plain English, a claimant cannot establish restitution simply by showing that the outcome feels unfair. The claim must fit a recognised legal basis for requiring a benefit to be returned or paid for.
At [43], the Court stated that restitution may be supported where work is done at the express or implied request of the recipient. This identifies the route MPI tried first. The difficulty was proof: the Court did not find a sufficient basis to infer that PMG had asked MPI to incur the disputed expenses.
At [45], the Court said, “This is not the case in which to resolve the controversy.” This is important because the appeal did not settle whether free acceptance is an independent unjust factor in Australia. The Court decided the appeal on the evidentiary failure instead.
At [47], the Court observed that free acceptance and implied request may overlap. In ordinary terms, the same facts that suggest someone knew a service provider expected payment may also suggest that they implicitly requested the service. The distinction between the two routes may therefore be difficult to draw in some cases.
At [50]-[51], the Court focused on the Cauchis’ position as principal beneficiaries. It accepted that a recipient might sometimes reasonably understand that it must contribute even where the service provider also benefits. But that shared benefit makes a clear factual basis for expected payment especially important.
At [64], the Court summarised MPI’s burden: it had to establish either an implied request or facts showing PMG should have known it was expected to pay and did not reject the services despite an opportunity. The Court held MPI had not discharged that burden.
The decision is most directly relevant to restitution claims seeking payment for development work or expenses where there is no enforceable cost-sharing agreement. Its reasoning is particularly pertinent where one party initiated and controlled the project, engaged the contractors or consultants, and incurred costs to advance a development from which it received the largest benefit: [13], [50]-[52].
It is also relevant where parties entered a written agreement dealing with some project matters, such as land transfers and identified work, but left other claimed costs unaddressed. The Court examined the deed’s defined obligations, the entire-agreement clause and the negotiations surrounding it when assessing whether PMG could reasonably have understood that a separate contribution obligation existed: [19]-[23], [56]-[60]. The judgment does not say that omission from a written agreement always defeats restitution. Its significance here was that MPI accepted the deed did not cover the disputed costs, while the evidence did not establish a separate arrangement.
The case may be relevant where the claimant relies on the recipient’s knowledge that work was taking place or on the fact that the recipient ultimately obtained a benefit. The Court treated general awareness or acquiescence as insufficient on these facts, particularly where the evidence did not establish what PMG knew about particular expenses, when they were incurred, or whether PMG had an opportunity to reject them: [61].
It may also matter where a claimant seeks to allocate project expenses by different methods after the work has been completed. Here, the differing proportions used for different cost categories were not supported by evidence of an agreed or objectively apparent allocation basis: [55]. The judgment’s factual reasoning suggests that the claim must connect the alleged expectation of payment to a discernible basis, rather than merely assert that the recipient benefited.
The precedent should be read narrowly. The Court did not decide that free acceptance is unavailable, nor that a co-beneficiary can never recover from another beneficiary. It decided that this claimant had not established the required factual elements on this record.
The supplied judgment is dated 12 March 2026. The material provided does not include decisions issued after that date, so it does not establish how later courts have treated Mead Property Investments Pty Ltd v P&M Galea Pty Ltd. No later treatment can be responsibly identified from this source alone.
The judgment itself discusses earlier authorities. It applies Redland City Council v Kozik and Farah Constructions Pty Ltd v Say-Dee Pty Ltd when describing restitutionary analysis and the need to use recognised categories of unjustness: [42]. It applies Lumbers and Lampson for the established proposition that a request may support restitution for work performed: [43]. It considers Hegarty, LCM Operations, Atlanta Building and Lampson in describing uncertainty about free acceptance: [44]. It applies Vasco Investment Managers and Hegarty to the objective assessment of whether a reasonable person would have realised that payment was expected: [48].
The Court also discusses Mann v Paterson Constructions in connection with the proposition that restitution should respect contractual regimes and contractual allocations of risk: [63]. It did not need to decide the appeal on that ground. Free JA reasoned that if a separate cost-sharing arrangement existed independently of the Land Swap Deed, the contractual allocation point would not answer the claim. The problem was that MPI did not substantiate the alleged separate arrangement.
These are the judgment’s relationships with authorities available to it, not evidence of later judicial endorsement. The decision’s unresolved statement about free acceptance should not be presented as a definitive Australian rule.
The central open question is whether, under Australian law, free acceptance without an express or implied request is itself a sufficient unjust factor to support restitution. Free JA expressly declined to resolve it because MPI failed on the facts even assuming the doctrine could be available: [44]-[45], [64].
The judgment also leaves room for argument about what circumstances, beyond the facts here, would amount to a reasonable opportunity to reject services. The formulation in [46]-[48] requires that question, but the Court did not need to define its limits. In this case, MPI’s proof was too general to establish what PMG knew about specific expenses or when PMG could have rejected them: [61].
Another open issue is how a court should assess an expectation of contribution when multiple landowners benefit in different ways from a common development. The Court highlighted uncertainty over how costs would have been apportioned among the Cauchis, PMG and the Polistina parties, and found no evidence those questions had been addressed: [54]-[55]. It did not prescribe an allocation method.
The decision also does not determine how far a written agreement’s silence about a category of costs should affect a separate restitution claim. The deed’s omission was important in combination with the negotiations, the entire-agreement clause, and the lack of persuasive evidence of a separate arrangement: [23], [56]-[60]. The judgment does not establish that silence alone excludes restitution.
Finally, the source text contains a date inconsistency worth noting for citation checking: [60] refers to an email from “December 2022”, whereas the judgment earlier identifies the relevant Orion email as dated 22 December 2020: [18], [35], [59]. The analysis above relies on the repeated references to the 22 December 2020 email and describes the inconsistency rather than treating the later date as established.
This is general legal information, not legal advice. Zoe can make mistakes. Before acting on or relying on this analysis, have a qualified Australian lawyer check it.
Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Mead Property Investments Pty Ltd v P&M Galea Pty Ltd [2026] NSWCA 27
Hearing dates: 23 February 2026
Date of orders: 12 March 2026
Decision date: 12 March 2026
Before: Ward P at [1]
Free JA at [2]
Griffiths AJA at [66]
Decision: (1) Appeal dismissed.
(2) The appellant is to pay the respondent’s costs.
Catchwords: ENVIRONMENT AND PLANNING — subdivision — land swap deed negotiated by owners of neighbouring properties in Box Hill — negotiations instigated by owners of appellant to expand scope of proposed subdivision — appellant incurs range of expenses to satisfy conditions of development consent — no enforceable agreement about sharing burden of these costs — claim for restitution for unjust enrichment
RESTITUTION — nature of restitutionary liability — quantum meruit — unjust enrichment — unjust or vitiating factors — express or implied request — failure to establish on the evidence
RESTITUTION — unjust or vitiating factors — “free acceptance” — uncertainty in Australian law — provider of services also principal beneficiary — potential overlap with factors demonstrating implied request — failure to establish why a reasonable person in the circumstances would have known the service provider expected to be paid — unnecessary to resolve legal controversy
Legislation Cited: Environmental Planning and Assessment Act 1979 (NSW), s 7.11
Cases Cited: Atlanta Building Pty Ltd v Abdela (No 3) [2025] NSWSC 730
Damberg v Damberg (2009) 52 NSWLR 492; [2001] NSWCA 87
Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89; [2007] HCA 22
Hegarty v Keogh (No 2) [2023] SASCA 30
Lampson (Australia) Pty Ltd v Fortescue Metals Group Ltd (No 3) [2014] WASC 162
LCM Operations Pty Ltd v Rabah Enterprises Pty Ltd [2023] NSWSC 590
Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635; [2008] HCA 27
Mann v Paterson Constructions Pty Ltd (2019) 267 CLR 560; [2019] HCA 32
Redland City Council v Kozik (2024) 281 CLR 202; [2024] HCA 7
Vasco Investment Managers Ltd v Morgan Stanley Australia Ltd [2014] VSC 455
Texts Cited: Goff and Jones, The Law of Restitution (5th ed, 1998, Sweet & Maxwell Ltd)
Mason K, Carter JW and Tolhurst G, Restitution Law in Australia (5th ed, 2025, JW Carter Publishing Pty Ltd)
Category: Principal judgment
Parties: Mead Property Investments Pty Ltd (Appellant)
P & M Galea Pty Ltd (Respondent)
Representation: Counsel:
J Pokoney (Appellant)
A E Maroya (Respondent)
Solicitors:
Fortis Law (Appellant)
Mahony Law (Respondent)
File Number(s): 2025/354050
Publication restriction: Nil
The appellant, Mead Property Investments Pty Ltd (MPI), is owned and controlled by John Cauchi (Mr Cauchi). Mr Cauchi owned an area of land at Box Hill (Cauchi Property) with his brother. In early 2018 the Cauchis developed a proposal to subdivide their land. They later sought to negotiate with the owners of neighbouring land with a view to expanding the scope of the subdivision. At that time the respondent, P&M Galea Pty Ltd (PMG), a company owned and controlled by Paul Galea (Mr Galea), was in the process of acquiring land to the south-east of the Cauchi property (Galea Property). PMG agreed for the Galea Property to be incorporated into the Cauchis’ subdivision proposal. Development consent for the subdivision was obtained in April 2019, which consent was subsequently modified. The subdivision plans as approved provided for the creation of 50 residential lots, of which the Cauchi parties owned 40 lots. PMG owned four lots.
After protracted negotiations, the Cauchis and PMG made a deed (Land Swap Deed) by which they agreed that there would be a land swap to deal with the fact that the subdivision would result in the creation of residential lots traversing the boundary between the Cauchi Property and the Galea Property. Pursuant to the Land Swap Deed, the parties agreed to transfer to each other various specified areas, so that after registration of the subdivision each of the lots in question would be owned solely by one party or the other. The Land Swap Deed also provided that each party would be responsible for payments associated with the development and servicing of, broadly speaking, its own lots. No agreement was recorded in the Land Swap Deed about the costs associated with the subdivision itself, including costs that needed to be incurred to satisfy the conditions of consent for the subdivision.
In fact MPI incurred those costs itself, including by making payments and organising the carrying out of works required to satisfy the conditions of the consent for the subdivision. As conceded on appeal, neither Mr Cauchi nor MPI ever made an enforceable agreement with PMG about sharing in the burden of such costs. Nevertheless, in March 2022 the Cauchi parties asserted an entitlement to recover a share of such costs from PMG. PMG denied that it had any such obligation and refused to pay.
On appeal MPI argued that it was entitled to restitution on a quantum meruit basis. MPI submitted that PMG had, at the expense of MPI, been unjustly enriched by obtaining the benefit of the subdivision works pursuant to which the PMG lots had been created. MPI put the argument on two alternative bases. First, it argued that PMG had accepted the benefits from MPI, in circumstances where there had been an implied request by PMG for the services to be performed. Second, it argued that even if there was no such request, PMG had “freely accepted” the benefits, in circumstances where a reasonable person should have known that MPI expected to be paid for them, and yet PMG did not take a reasonable opportunity open to it to reject the proffered services.
The Court held (Free JA, Ward P and Griffiths AJA agreeing), dismissing the appeal:
1. It can assist in a claim for restitution for unjust enrichment to structure the enquiry by asking what benefit a defendant has received, whether the benefit is at the plaintiff’s expense, whether the circumstances render the provision of that benefit unjust, and whether any defences apply. “Unjustness” in this context is not an abstract notion or a question of mere subjective perception of unfairness or injustice. Analysis proceeds by reference to recognised categories: [42].
Redland City Council v Kozik (2024) 281 CLR 202; [2024] HCA 7, Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89; [2007] HCA 22, applied.
2. It is well-established that unjust enrichment may be established where work is performed at the express or implied request of the party receiving the benefit: [43].
Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635; [2008] HCA 27, Lampson (Australia) Pty Ltd v Fortescue Metals Group Ltd (No 3) [2014] WASC 162, applied.
3. There remains uncertainty about whether, in the absence of an express or implied request, “free acceptance” of the benefit is sufficient as an unjust or vitiating factor under Australian law: [43]-[44].
Hegarty v Keogh (No 2) [2023] SASCA 30, LCM Operations Pty Ltd v Rabah Enterprises Pty Ltd [2023] NSWSC 590, Atlanta Building Pty Ltd v Abdela (No 3) [2025] NSWSC 730, Lampson (Australia) Pty Ltd v Fortescue Metals Group Ltd (No 3) [2014] WASC 162, Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635; [2008] HCA 27, considered.
4. It is unnecessary on the facts of this appeal to resolve the question of whether “free acceptance” is sufficient to sustain a claim for restitution. MPI was unable to point to any evidence implying a request made by PMG for MPI to undertake the works. Nor was MPI able to demonstrate why a reasonable person in the position of Mr Galea or PMG would have known that Mr Cauchi or MPI expected to be paid: [45]-[64].
Vasco Investment Managers Ltd v Morgan Stanley Australia Ltd [2014] VSC 455, Hegarty v Keogh (No 2) [2023] SASCA 30, applied.
WARD P: I agree with Free JA.
FREE JA: This appeal arises from the subdivision of land in Box Hill. The appellant, Mead Property Investments Pty Ltd (MPI), is owned and controlled by John Cauchi (Mr Cauchi). Mr Cauchi owned an area of land at 13-15 Edwards Road, Box Hill (Cauchi Property), together with his brother, Frank Cauchi. The Cauchi Property shared a boundary with land (Galea Property) that came to be owned by the respondent, P&M Galea Pty Ltd (PMG), a company owned and controlled by Paul Galea (Mr Galea).
In early 2018 Mr Cauchi and his brother Frank began planning a subdivision of the Cauchi Property. They appointed MPI as the principal contractor to manage the development and engaged a firm called “Project Surveyors” to provide project management services. Project Surveyors was later replaced in that role by Orion Consulting Engineers Pty Ltd (Orion). Mr Cauchi sought to negotiate with Mr Galea about the potential inclusion of the Galea Property in the proposed subdivision. When negotiations commenced PMG was in the process of acquiring the Galea Property. Mr Cauchi conducted similar negotiations with Mr Sevario Polistina and Mr David Polistina, the owners of other land that adjoined the Cauchi Property (Polistina Property).
Both sets of negotiations proved successful. Through Project Surveyors development consent was obtained from The Hills Shire Council (Council) in April 2019 for subdivision of an area of land formed through the combination of parts of the Cauchi Property, the Galea Property and the Polistina Property. That consent was subsequently modified. The lots formed within the Cauchi Property comprised the lion’s share of the subdivision. The subdivision as approved in the modified form resulted in the creation of 50 residential lots, of which the Cauchi parties owned 40 lots. PMG owned four lots. Measured as a proportion of the total land area, the Galea owned lots comprised 11.5% of the subdivision. The remaining lots were owned by the Polistina parties.
MPI incurred a range of expenses related to the subdivision, including by making payments and organising the carrying out of works required to satisfy the conditions of the consent for the subdivision. On appeal MPI accepted that it never made an enforceable agreement with PMG about sharing in the burden of such costs. The Cauchis did negotiate an agreement with PMG which was principally concerned with an exchange of ownership of land (Land Swap Deed). This land swap was prompted by the fact that the proposed subdivision created seven lots that traversed the boundary between the Cauchi Property and the PMG Property. Under the Land Swap Deed, the Cauchis and PMG agreed to transfer to each other various identified portions of the affected land, with the result that after registration of the subdivision each of the lots in question would be owned solely by one party or the other. The Land Swap Deed also provided that each party would be responsible for payments associated with the development and servicing of, broadly speaking, its own lots. No agreement was recorded in the Land Swap Deed about the costs associated with the subdivision itself, including costs that needed to be incurred to satisfy the conditions of consent for the subdivision.
As explained above, if MPI is not correct in its assertion that there was an express or implied request for the benefits to be provided, MPI’s fallback argument on appeal depends on the proposition that the circumstances were such that a reasonable person in the position of PMG would have appreciated that MPI (or whichever entity happened to be used by the Cauchi parties to progress the subdivision development) expected to be paid for the benefits that were being freely accepted by PMG. In oral argument Mr Pokoney, who appeared for MPI, described PMG as having been party to an arrangement (stopping short of an enforceable agreement) that MPI or another entity associated with the Cauchis was to undertake the works associated with the subdivision, and there was either an implied request for the services to be provided or “at the very least a free acceptance in circumstances where [PMG] would have known that these were not services being rendered gratuitously”. The following summary of the findings and evidence is focused on testing the factual foundations for that submission. The summary is drawn primarily from uncontested findings of the trial judge.
The genesis of the subdivision development predates any involvement by PMG or Mr Galea. The Cauchi brothers conceived of a plan to subdivide the Cauchi Property in early 2018. In June 2018 Mr Cauchi entered into a loan agreement to finance the development of the Cauchi Property and around the same time he appointed MPI as the principal contractor and Project Surveyors as project managers. Only after this had occurred did Mr Cauchi begin discussions with Mr Galea about the possibility of expanding the subdivision to incorporate the Galea Property. This occurred at some point shortly after June 2018. At the time PMG was in the process of acquiring that property. Negotiations between Mr Cauchi and Mr Galea relating to the incorporation of the Galea Property continued between mid-2018 and February 2019. Around the same time the Cauchis had similar discussions with the Polistinas. There is no suggestion that the negotiations ever became tripartite. No findings were made about Mr Galea having been involved in any negotiations with the Polistinas relating to the subdivision.
In February 2019 Project Surveyors lodged an application with the Council for consent for the subdivision of an area covering parts of the Cauchi Property, the Galea Property and the Polistina Property. Consent for the subdivision was granted on 30 April 2019. Under the plans of subdivision approved in that consent, 49 residential lots were to be created. As shown on the approved plan, the subdivision involved the creation of lots that traversed the boundary between the Cauchi Land and the Galea Land. The following diagram is extracted from the approved plan. For ease of reference highlighting has been added to identify the Galea Property. The lots shown on the diagram are otherwise located on the Cauchi Property:
As can be seen from the plan, a feature of the subdivision was that it involved the creation of new lots that traversed the boundary between the Galea Property and the Cauchi Property. In the north-west section of the subdivision (not shown on the above extract), there was a similar arrangement with land traversing the boundary between the Polistina Property and the Cauchi Property.
As discussed in our meeting earlier today, I have talked to Paul Galea about expectations during the subdivision development.
I note that I communicated:
- He was responsible for all development costs within his Lots 2 and 3 of DP 546799 (271 and 269 Annangrove Road).
- You would be responsible for the works within yours.
- Based on previous agreements, the land swaps to create his 243, 244 and 245 and yours 229,231, 242, 246 are generally equal and so there will be no cash exchanged for this swap.
- Lot 230 will require he purchase your land for the balance of the lot at the rate of $775/sqm.
I will finalise the directions with Paul and hope to get an answer from him ASAP. Depending on what he says this will require an amended deed or otherwise, a different pathway forward.
The Land Swap Deed was executed three months later. The parties to the Land Swap Deed were PMG, on the one hand, and John, Anthony and Frank Cauchi, on the other. MPI was not a party to the deed.
The Land Swap Deed reflected the elements of the commercial bargain as described in Mr Pineda’s email. Clause 2.2 of the deed records the agreement of the parties to transfer to each other the land comprising parts of the proposed lots to “ensure that the parties achieve the best subdivision potential from their Land and that all residential lots in any subdivision in respect of the Site are in the name of only one of the parties”. The net effect of these arrangements was that after the registration of the plan of subdivision there would be a change in ownership of particular sections of land around the existing boundary between the Cauchi Land and the Galea Land, as a result of which the Cauchis were to own Lots 229, 231, 242 and 246 and PMG was to own Lots 230, 243 and 245. By cl 2.2(b) the parties, acknowledging that the areas being transferred to each other were not of equal value, it was agreed that PMG would pay the Cauchi parties the “Difference Sum” (being $558,785) at the time Cauchi Lot 230 was transferred to PMG.
By cl 4.1(a) of the Land Swap Deed the parties agreed that they would engage Western Earth Moving Pty Ltd (WEM) to undertake the “Works” and sign any required contracts with WEM within one day of the date of the deed “to reflect the works to be undertaken in relation to their individual land”. The “Works” were defined in cl 1.1 as being the works and activities associated with the land swap set out in cl 4 of this Deed and in Annexure C. Annexure C provides:
Annexure C - Works
The parties agree that the below Works will be undertaken and paid for by each other:
- Construction Costs of Roads and Services and Other Fees.
As per Western Earth Moving Pty Ltd (WEM) documents dated January 2021.
- Costs associated with Lots 229, 230,231, 242 and 246 in the Draft Plan will be borne by Cauchi including the cost of roads / fronts, council and statutory contributions;
- Costs associated with lots 245, 244 and 243 will be borne by Galea including the cost of roads / fronts, council and statutory contributions.
Clause 4.1(b) provides that “Galea will be responsible for all payments associated with the development and servicing of lots shown as 245, 244 and 243 on the Draft Plan”. Lot 244 was a lot wholly within land already owned by PMG. Lots 243 and 245 were to become wholly owned by PMG pursuant to the land swap. Under cl 4.1(c) Cauchi agreed to be “responsible for all payments associated with the development and servicing of lots shown as 229, 230, 231, 242 and 246 on the Draft Plan”. This outcome broadly aligns with the approach foreshadowed in the email from Mr Pineda of 22 December 2020, in that Cauchi remained responsible for development costs for the works within the Cauchi land, including areas that were to be transferred to PMG (in particular Lot 230).
Clause 8.6 was an entire agreement clause in the following terms:
8.6. Whole agreement
In relation to the subject matter of this Deed:
(a) this Deed is the whole agreement between the parties; and
(b) this Deed supersedes all oral and written communications by or on behalf of any of the parties.
At unknown times, MPI and Orion set about making the payments and facilitating the carrying out of the works required to progress the subdivision, including by making the special infrastructure and development contribution payments required by the conditions of consent. This in due course led to the demand for payment issued to PMG in March 2022. By the time of trial, MPI identified the following categories of costs within the overall demand on PMG:
Authority and C****onsultant costs. These were costs incurred by MPI in payments to Orion, “DA costs” and other amounts payable to authorities and consultancies. MPI claimed $151,971.90, on the basis that PMG was obliged to pay one-third of the total costs;
Contribution Costs. These were comprised of the special infrastructure contribution of approximately $1.3m, a payment of the “Sydney Water Recycled Water Invoice” of $211,600 and a payment to Telstra of $64,528. MPI claimed $181,225.42 from PMG, on the basis that it was obliged to pay 11.5% of the total costs. As noted above, 11.5% is the proportion of the land area of the subdivision owned by PMG (at least as calculated by MPI);
Section 7.11 Contribution. This is the amount of $1,920,000 required to be paid to the Council as a development contribution pursuant to s 7.11 of the EPA Act. MPI claimed $153,600 from PMG, on the basis that this was 8% of the total cost and PMG owned 8% of the residential lots created by the subdivision. The underlying justification given by MPI for adopting this metric was that development contributions of this kind are determined on a per-lot basis by the consent authority;
Edwards Road Construction Costs. This is the amount of $410,917.50 associated with works carried out on Edwards Road, which is a road running along the northern boundary of the Cauchi Property. MPI claimed $102,729.38, being 25% of the total cost. The explanation for this amount emerged from the evidence of Mr Cauchi. In an affidavit read at trial, he said that although he initially thought the amount should be divided three ways between the parties, he “eventually decided that Polistina and Galea should contribute only 25% each”;
Bond Costs. The total bond costs were $85,289.38 and MPI claimed 11.5% of those costs ($9,808.28) from PMG;
SWC Developer Charges. The total costs in this category were $10,699.92 and MPI claimed 11.5% of those costs ($1,230.49) from PMG; and
Management Fee. MPI also claimed from PMG management fees for itself ($13,673.60) as principal contractor.
As noted above, MPI argued at trial that the Land Swap Deed was part of a broader implied agreement that PMG would share in all the costs associated with the subdivision. To that end MPI sought to give a broad construction to Galea’s agreement, in cl 4.1(b), to accept responsibility for “all payments associated with the development and servicing” of the specified lots. PMG’s obligation to make all those payments was said to encompass the amounts claimed by MPI, or at least was said to be complementary to a broader agreement to that effect.
(a) to swap certain parcels of land within their respective properties; (b) to lodge a development application with the Council to develop the properties; (c) that “each party was to contribute to the development application costs and all expenses incurred in respect of complying with the development conditions imposed by the Council, including but not limited to, consultant costs, payment to relevant authorities, and construction costs relating to development outside the lots owned by the parties”; (d) that if any development costs were incurred and paid by a party, the other party would reimburse the party who paid the development costs; and (e) that each party was to pay their own costs for the development within their property and the land each party would own following the land swap.
Mr Cauchi’s affidavit evidence of 15 April 2024. In the relevant passage of that affidavit Mr Cauchi referred to the agreement he had described in his 2 September 2023 affidavit. He said that, as the conversations in question had occurred more than five or six years previously, he could not remember the words that were spoken. Mr Cauchi nevertheless asserted that the “gist of the conversation” was as he had set out in his 2 September 2023 affidavit in describing the agreement reached between him and Mr Galea.
It is necessary to say something more about the evolution of Mr Cauchi’s evidence across the two affidavits. In the 2 September 2023 affidavit, Mr Cauchi had addressed the various categories of costs covered by the demand for payment that was being made by MPI against PMG. In relation to “Authority and Contribution Costs”, “Contribution Costs” and “Section 7.11 Contribution Costs”, Mr Cauchi said that MPI had paid the costs based on an understanding that PMG would repay MPI “as agreed between the parties and as per the Deed”. In relation to “Authority and Contribution Costs” he said that MPI and PMG had “agreed together with Polistina that the Authority and Consultant costs will be paid in equal shares”. In relation to “Contribution Costs” he said that MPI and PMG had “agreed together with Polistina that the Contribution Costs will be split in accordance with the land area percentage owned by each party to the development”.
Nowhere in the 2 September 2023 affidavit did Mr Cauchi explain the basis for his understanding about these alleged agreements. He did not give evidence about the content of any conversations or communications evidencing the agreements. As noted above, in his affidavit of 15 April 2024, Mr Cauchi acknowledged that he had no recollection of any words spoken during the conversations that occurred between mid-2018 and 2019, but asserted that the gist of those conversations was as per the agreements he had described.
In the 15 April 2024 affidavit, Mr Cauchi also cross-referred to the evidence he had given in his affidavit of 2 September 2023 about the agreements that existed in relation to particular cost categories. Mr Cauchi explained that his evidence in that regard was based on what he “believed to be the effect of the Land Swap Agreement in the overall circumstances where the Cauchi parties, [PMG] and Polistina lodged a combined Development Application (DA) which by the date of the Land Swap Agreement (19 March 2021) had been approved by Council with fees and costs being paid by [MPI] as and when those costs for the DA were incurred. I do not recall that there were separate conversations with any representative of [PMG] where a separate agreement was reached on the matters addressed in those paragraphs”: J[36].
In substance, Mr Cauchi’s assertions about what had been agreed involved little, if anything, more than his understanding of the effect of the Land Swap Deed. To the extent that there was said to be some different or additional agreement or arrangement based on conversations preceding the Land Swap Deed, no meaningful evidence was given by Mr Cauchi about the timing, context or content of such conversations.
Q. One of the matters that you wanted to clarify in your second affidavit was an agreement which you say was entered into between mid-2018 and February 2019. You say that in your first affidavit and you say it was an agreement that was entered into with the parties standing behind the defendant in these proceedings, P & M Galea? You understand that? You say you had an agreement with Mr Paul Galea sometime in the period from mid-2018 to February 2019, is that right?
A. Maybe.
Q. You say in your first affidavit that you and Mr Galea had a conversation and the things that you say in paragraph 12 of your affidavit on pages B3 and B4 of the book were agreed. Do you recall that evidence?
A. Not really.
…
Q. You say you had a conversation, if one goes back to your first affidavit, between about mid-2018 and February 29?
A. Possibly.
Q. Was it just one conversation?
A. I had, I really had lots of conversations with Paul.
…
Q. You say that in the same period, mid-2018 to February 2019, you told Mr Galea that each party was to contribute 5 to the development application costs and all expenses incurred in respect of complying with the development conditions imposed by council, including but not limited to consultant costs, payment to relevant authorities, and construction costs relating to development outside the lots owned by the parties. Is it your evidence that in about 10 mid-2018 to February 2019 you said something to Mr Galea along those lines?
A. I can't recall. I can't recall having that conversation with Mr Galea.
Q. Do you recall saying to Mr Galea if any development costs were incurred and paid by a party, and by a party, that is either the Cauchi party or the Galea 15 party, the other party would reimburse the party who paid those costs. Do you recall saying that?
A. No, I can't recall that either.
Q. Do you recall saying to Mr Galea that each party was to pay their own costs for the development within their property and the land each party would own following the land swap?
A. No.
Q. Do you recall Mr Galea saying to you in this conversation or conversations if there was more than one, that yes, that's all fine, but there's no agreement unless there's an agreement reduced to writing?
A. Can't recall. I can't recall having that conversation with Paul Galea.
…
Q. The conversation that you refer to in paragraph 12 of your first affidavit from September 2023?
A. (No verbal reply)
Q. If you didn't have that conversation with Mr Galea, who do you say you had the conversation with?
A. I don't know. That was a long time ago.
Q. You can't recall the person with whom you say you had this conversation?
A. No.
Q. But you can't exclude the possibility, doing your best today, giving evidence in the box, that Mr Galea did not say to you "Any contract between us will be a contract in writing"--
A. No.
Q. --"which you and I both sign"?
A. No.
Q. You can't exclude that he didn't say that?
A. He didn't say that. I can't, I can't remember that conversation with Paul Galea, and I don't know where it took place. You're not very specific on where it took place.
…
Q. You’ve just told her Honour that there was no question whatsoever of there having been a share of profits because, as you put it, your land was your land, Mr Galea’s land was his land and Mr Polistina’s land was his land. Can you recall the detail of any conversations that you had with Mr Galea, and Mr Polistina for that matter, about the basis upon which the costs of the overall project, if I can put it that way, would be shared?
A. What do you mean by that question? What, what do, what do you mean by that?
Q. If there was not going to be a share of profits, what was your understanding at the time that you say you made this arrangement or you made this agreement of how the expenses were going to be shared?
A. Well, Paul paid for his expenses, right. The DA stated Edwards Road was a shared, was a, a, a, shared - there was no, there was no advantage to myself, no advantage to Paul or Dave. That was a condition of the development application. Dave’s name was on that DA. Paul’s and my name was on that DA.
Q. And how do you say that an agreement was reached between these three parties, including yourself as one of the three, for the sharing of those costs?
A. Well, we didn’t have an agreement as such.
Q. So you assumed, did you--
A. No, Paul got the DA. Paul got the DA like I got a copy of the DA stamped. Paul knew exactly what he was up for and so did Dave. It wasn’t, wasn’t rockin’ [as said] science. It was--
Q. Paul wouldn’t have known from that DA--
A. Yeah, well, Paul had, Paul had his solicitor 5 working and his accountant working for him. Paul knew exactly what was going on.
Q. But Paul wouldn’t have known from the terms of that DA--
A. Paul knew exactly what was going on.
…
Q. So you assumed he knew on the basis of--
A. I’m, I’m sure--
Q. --what you understood--
A. I’m sure--
Q. --to be his past experience?
A. Yeah, I’m sure Paul knew exactly, exactly what was required from him on that development application.
Q. And you assumed that because of your knowledge of his past experience?
A. Yes.
Q. That’s why you say that you didn’t bother entering into a land swap deed with Mr Polistina because you didn’t think it was necessary--
A. And it wasn’t. That--
Q. --but in Paul’s case you were concerned--
A. Well, Paul, Paul--
Q. --to record everything in writing.
A. Well, yes, that’s the sort of man he was. You know, a handshake wasn’t good enough with Paul.
Q. Because Paul said to you, did he not, that oral words weren’t enough. He wanted to see the agreement recorded in writing?
A. No, I don’t think he did. I, I think that was a condition of PwC.
Q. PwC?
A. Pricewaterhouse and [as said] Coopers.
Q. PricwaterhouseCoopers?
A. Yes.
Q. And they said you have to record your agreement with him in writing?
A. Well, I believe so.
Q. But you’re not certain about that either?
A. Well, you know what, as I said, it’s a long time ago.
Q. But I think your evidence is that, at the risk of repetition, you were satisfied that the land swap deed recorded what you had agreed with Mr Galea?
A. Possibility, yeah. Paul seen the, Paul also seen the land swap deed and signed it. Am I not correct?
Q. Indeed, he did. You are entirely correct, but my question to you was different. You were satisfied because of the instructions, I think your evidence is, that you gave your lawyers--
A. My consultants.
Q. --or rather your consultants - the instructions you gave your consultants ended up finding expression in the land swap deed; that’s right, isn’t it?
A. Yeah, yeah.
Mr Cauchi’s description in this passage of cross-examination of the process leading to the Land Swap Deed is consistent with contemporaneous documentary evidence, in the form of the email from Mr Pineda of Orion on 22 December 2020. In that email, Mr Pineda said that he had spoken to Mr Galea “about expectations during the subdivision development”. As explained above, the expectations as described in that email essentially accord with the contents of the Land Swap Deed. The email indicates an intention, subject to PMG’s response, to proceed with documenting the expectations in the form of the Land Swap Deed.
Mr Galea’s evidence was to the effect that he had never agreed to contribute financially to the overall development scheme. Consistently with the Land Swap Deed, PMG had made a contract with WEM to undertake excavation works and PMG had paid WEM for those services. Mr Galea was cross-examined on the topic of contributing to the costs of the subdivision. The following exchanges occurred:
Q. [D]id you discuss the development works required to achieve the subdivision?
A. What we required, I pay for the cost of my, to develop the three blocks.
…
Q. The question was did you discuss, that is between you--
A. Yeah.
Q. --the works required to achieve the subdivision.
A. No, he didn’t discussed [sic] it all detail. Like, yeah, I mean we - all I know is I had to pay for the, that road, that second of the road that goes in front of the three blocks. That’s all I, that’s all I had to know, which he, he had Orion and we had Orion and gave me the bill to pay that road direct from Westerns.
…
Q. … So the first thing is you discussed swapping some land, correct?
A. Yes.
Q. You also discussed, although not in detail, some of the works that would be
required to achieve the subdivision, correct?
A. Yes, yeah, yeah.
Q. So, for example, you discussed some works that would be required on Outback Street--
A. Yes. Yes.
Q. --and you discussed, didn’t you, an arrangement whereby the works that were on Mr Cauchi’s land he would pay for--
A. Yes, he paid for his site and I paid for my site.
Q. --and that the works on your land you would pay for--
A. That’s right.
Q. --that’s right? And you discussed, didn’t you, that any costs that were indirectly related to those lots but were still necessary for the subdivision you would share them?
A. No.
…
Q. Did you understand in 2018 that there were likely to be some fees payable to the council, for instance?
A. No, sorry, the only, only thing I know I had to pay for the, for the three blocks is the council fees section 94, I think, the contribute and Sydney Water. That’s the only two fees and I’d pay for the construction to build the road.
Q. You understood in 2018, didn’t you, that there would be some fees from council associated with submitting the development application, for instance?
A. No. It’s John that’s doing it.
…
Q. So you thought in 2018, for instance, that a development application was free?
A. On my behalf--
Q. No.
A. I’m saying, all I, I keep repeating all I had to do is the three blocks. That’s all John asked me is the three blocks, land swap and I’d pay for the road. The rest John was going to look after. That’s all he, he told us and I trusted him. I trusted him as a friend.
In terms of discussions between Mr Galea and Mr Cauchi, the cross-examination did not elicit any relevant concessions. It is instead consistent with the notion that the Land Swap Deed dealt comprehensively with the arrangements between the parties concerning the subdivision. The high point for MPI’s case was the evidence that Mr Galea understood that he had to pay for “the council fees section 94, I think, the contribute and Sydney Water. That’s the only two fees and I’d pay for the construction to build the road”. Read in context, the reference to paying for the road must relate to the construction costs associated with the road directly in front of what Mr Galea referred to as his “three blocks”. Mr Galea’s evidence was that he paid WEM directly for that work.
That leaves only Mr Galea’s subjective understanding that he had to contribute to Sydney Water costs and “section 94 costs” which, it was common ground, must be read as being developer contribution costs now governed by s 7.11 of the EPA Act. The basis for that understanding was not exposed in the evidence. MPI has not explained how Mr Galea’s subjective understanding is evidence of, or a product of, circumstances that would have a broader significance to an objective assessment of what a reasonable person would have expected in relation to payment. In any case, MPI has not sought to argue in the alternative, either on appeal or at trial, that if it is not entitled to recover a share of the total costs it is nevertheless entitled to recover amounts corresponding to the Sydney Water costs and “section 94 costs”. In the circumstances, the limited concession in cross-examination about Mr Galea’s subjective understanding does not demonstrate that an arrangement of the kind alleged by MPI existed.
The trial judge rejected MPI’s submission that an oral contract had come into existence between Mr Cauchi and Mr Galea concerning the payment of a share of overall development costs. The relevant findings of the trial judge were as follows:
[57] The evidence falls well short of establishing on the balance of probabilities that an oral contract came into existence in the course of the conversations between Mr John Cauchi and Mr Galea prior to the execution of the Land Swap Deed.
[58] I am fortified in this conclusion by the evidence that there was considerable negotiation of the terms of the Land Swap Deed between the parties, with the involvement of their solicitors. It is clear that there was no concluded agreement until the execution of the Land Swap Deed.
The trial judge rejected the case advanced at trial that PMG requested MPI to undertake work for the benefit of PMG. In part that was driven by a finding that PMG was not aware of MPI, either as the entity being used by Mr Cauchi to facilitate the development or at all. More broadly, the trial judge accepted that Mr Galea “thought of the subdivision of part of his land, to yield three lots, as a minor add-on to the Cauchi parties’ much larger, 40 lot development”: J[65]. The trial judge reasoned that, in order to succeed on a claim for quantum meruit, it was necessary for MPI to prove that there was a request by PMG for MPI to do the work and a breach of a promise to pay for the work. Citing Mason K, Carter JW & Tolhurst G, Restitution Law in Australia (5th ed, 2025, JW Carter Publishing Pty Ltd) at [119], the trial judge noted that a request may be implied if the defendant acquiesces to the performance of the work in the knowledge that it is not being done gratuitously. On the evidence, though, the trial judge found that it had not been established that PMG did expressly or impliedly request MPI to do any work or that there was a promise to pay MPI in relation to any work.
In dealing with the restitutionary claim in this way, the trial judge was responding in terms to the case as advanced by MPI. Ground 2 of the notice of appeal asserts that the trial judge erred in failing to find that PMG’s free acceptance of the benefit of the work performed and payments made by MPI was sufficient to give rise to liability in restitution for unjust enrichment. That is, PMG contends on the appeal that there is no requirement in law for an express or implied request in order for acceptance of a benefit to give rise to unjust enrichment. As Mr Pokoney properly accepted at the hearing of the appeal, there is no basis to criticise the trial judge for failing to make a finding to this effect in circumstances where MPI’s restitutionary claim at trial was predicated on there having been an express or implied request. Only on appeal has MPI sought to argue that free acceptance alone is sufficient. Mr Maroya, who appeared for PMG, did not seek to argue that MPI was precluded from raising the point, because it might give rise to irremediable prejudice to PMG. Mr Maroya instead focused his argument on demonstrating why the new argument should be rejected on its merits.
The argument that MPI seeks to agitate about the scope of “free acceptance” of a benefit as an unjust factor warranting restitution, even in the absence of an express or implied request, raises a significant point of principle. The majority in Redland City Council v Kozik (2024) 281 CLR 202; [2024] HCA 7 at [180] recognised that, at a high level of generality, it can assist in a claim for restitution for unjust enrichment to structure the enquiry by asking what benefit a defendant has received, whether the benefit is at the plaintiff’s expense, whether the circumstances render the provision of that benefit unjust, and whether any defences apply. “Unjustness” in this context is not an abstract notion to be applied to the facts of any given case. It is not a question of mere subjective perception of unfairness or injustice. Analysis proceeds instead by reference to recognised categories: see (2007) 230 CLR 89; [2007] HCA 22 at [150].
[A] defendant, who is not contractually bound, may have benefited from services rendered in circumstances in which the court holds him liable to pay for them. Such will be the case if he freely accepts the services. In our view, he will be held to have benefited from the services rendered if he, as a reasonable man, should have known that the plaintiff who rendered the services expected to be paid for them, and yet he did not take a reasonable opportunity open to him to reject the proffered services. Moreover, in such a case, he cannot deny that he has been unjustly enriched. It is said that the recognition of free acceptance, so defined, is in principle objectionable for it erodes the right of a person to determine his own choices; only if he has requested services can he be said to have ‘chosen’ and gained a benefit. If a principle of free acceptance is recognised, a defendant may be compelled to pay for services which he asserts, honestly if perversely, are of no benefit to him; or he may be indifferent, not caring one way or the other, whether the services are rendered or not. Again, the defendant may concede that the services are beneficial but plead that he had ‘more important things on which to spend his money.’ But, in these exceptional circumstances, the burden should be on the defendant, who is not the reasonable man, immediately to tell the plaintiff that he is perverse, indifferent or that he has more important things to do with his money. If he does not do so, he cannot deny that he has gained a benefit.
MPI therefore assumed the burden of demonstrating that PMG accepted the benefit of the services performed (including payments made) by MPI in circumstances where a reasonable person should have known that MPI expected to be paid for them, and yet did not take a reasonable opportunity open to PMG to reject the proffered services. Understood in these terms, there may not always be a significant practical distinction between free acceptance of a benefit and acceptance of a benefit in circumstances where a request to provide those services will be implied. The factors that might lead a court to conclude that a reasonable person should have known that there was an expectation of payment may well be the same factors that are relied on to demonstrate an implied request. Indeed, that is the way MPI frames its alternative arguments in the present case. Putting that to one side, it is appropriate to proceed on the premises of the test as formulated by MPI.
The determination of whether the party providing the services had a reasonable expectation of being paid depends on an objective evaluation of whether a reasonable person in the circumstances would have realised that a person in the position of the service provider expected to be paid: Vasco Investment Managers Ltd v Morgan Stanley Australia Ltd [2014] VSC 455 at [347]; Hegarty v Keogh (No 2) [2023] SASCA 30 at [198].
On the facts of this case, MPI is unable to demonstrate why a reasonable person in the position of PMG would have known that MPI expected to be paid by PMG for the various services provided by MPI in connection with the subdivision and the payments made by MPI pursuant to the conditions of the development consent for the subdivision. In particular, MPI has not made good its submission that PMG was party to an arrangement with Mr Cauchi that MPI or another entity associated with the Cauchis was to undertake the works associated with the subdivision, in circumstances where PMG would have known that the services were not being rendered gratuitously.
Various circumstances make it far from self-evident that such an arrangement existed, or that PMG was expected to pay for a share of the costs incurred by MPI. A significant feature of the subdivision project was that the Cauchis stood to be the principal beneficiaries of the project, being the owners of 80% of the lots being created by the subdivision. This immediately distinguishes the present case from the scenario that typically arises in unjust enrichment claims, where the party providing the services in question does not itself take the benefit of those services. None of the authorities relied upon by MPI involved a situation where the provider of the services is itself a beneficiary of those services, let alone the principal beneficiary.
That is not to say that it is impossible to conceive of circumstances where the recipient of the benefit of services ought reasonably appreciate that there is an expectation of contributing to the cost of those services, even though the party providing the services is also a beneficiary of the same services. However, that factor does heighten the need for some clear basis to find that there was such a reasonable expectation of payment, despite the fact that MPI was incurring costs to further the Cauchis’ own project. What is missing in a situation of this kind is the natural inference that might be said to arise from the fact of party A providing services solely for the benefit of party B.
**********
Mead Property Investments Pty Ltd
P&M Galea Pty Ltd [2026] NSWCA 27
(2009) 52 NSWLR 492
(2007) 230 CLR 89
(2008) 232 CLR 635
(2019) 267 CLR 560
(2024) 281 CLR 202
Appeal dismissed. The appellant is to pay the respondent’s costs: [65].
The Cauchi parties nevertheless asserted an entitlement to recover a share of such costs from PMG. In March 2022 Mr Galea received an email from solicitors acting for Mr Cauchi, attaching an invoice issued by MPI to PMG in the amount of $686,363.88. PMG was said to be liable for this amount by way of reimbursement for a share of the costs associated with the subdivision that had been incurred by MPI. PMG denied that it had any such obligation and refused to pay the invoice.
MPI sued PMG to recover the money said to be owed. At trial MPI advanced a number of arguments in the alternative as to why PMG was liable. The first was that PMG was liable in contract. The primary judge was urged to find, as a matter of implication or inference, that an agreement was formed between MPI and PMG based on the conduct of the parties, beginning with conversations in mid-2018 through to the execution of the Land Swap Deed in March 2021. Although MPI was not a party to the Land Swap Deed, MPI sought to argue that the Land Swap Deed “complemented” the verbal agreement reached between the parties. In that context MPI argued that where the Land Swap Deed referred to PMG being responsible for “all payments associated with the development” of its individual lots, that reflected a broader agreement that PMG was responsible for a share of the overall costs of the subdivision.
The second argument advanced at trial was that MPI was appointed as the agent of PMG, pursuant to the Land Swap Deed, and on that basis MPI was entitled to be indemnified by PMG for costs and expenses incurred in carrying out its functions.
Finally, MPI argued at trial that it was entitled to restitution on a quantum meruit basis. MPI submitted that PMG had been unjustly enriched by obtaining the benefit of the subdivision works pursuant to which the PMG lots had been created. Such enrichment had come at the expense of MPI, which had made the payments and incurred the costs necessary to facilitate the subdivision. MPI argued that PMG had “freely accepted” the benefits from MPI, in circumstances where there had been an express or implied request by PMG for the services to be performed. Such a request was said to be evidenced by the Land Swap Deed.
The trial judge rejected each of those arguments and dismissed MPI’s claim. On appeal MPI seeks to pursue only the third argument. It does so in a way that is, in significant respects, different from the argument pursued at trial. MPI does not persist in its claims in contract or for reimbursement on the basis that MPI was the agent of PMG. MPI now disavows any suggestion that the Land Swap Deed dealt with the costs of the subdivision in respect of which MPI seeks reimbursement. MPI maintains the argument that there was an implied request from PMG for MPI (or an entity associated with the Cauchis) to make the payments and incur the costs in question and to confer the corresponding benefits on PMG. But MPI also argues that even if there was no such implied request it is sufficient for the purposes of the claim in restitution that PMG freely accepted the benefits.
The refined version of MPI’s claim for restitution raises an issue of principle as to whether, under Australian law, the free acceptance of a benefit in the absence of an associated request for the benefit to be conferred is a recognised “unjust factor” of the kind that can sustain a claim for restitution. However, it is unnecessary to resolve that issue in order to determine the appeal. The primary judge was correct to reject the suggestion that there was an express or implied request by PMG for the services in question to be provided. MPI’s new claim in the alternative is predicated on an assertion that PMG freely accepted the benefits of the payments made and services performed by MPI in relation to the subdivision in circumstances where a reasonable person should have known that PMG was expected to make a proportional reimbursement to MPI. MPI has failed to demonstrate that there is any factual foundation for such a finding. The appeal should be dismissed with costs.
In July 2019 Orion took over from Project Surveyors as the project manager of the subdivision project. Mr Cauchi was responsible for that appointment and no findings were made below about Mr Galea or PMG having any involvement in that process. In December 2019 Orion lodged an application with the Council for modification of the development consent, involving a revised plan of subdivision with 50 residential lots. Council gave its consent to the modification on 15 October 2021.
The consent for the subdivision, including as modified, was subject to a number of conditions. For example, the conditions required the carrying out of certain infrastructure works, including upgrades to adjoining roads and works required by Sydney Water to connect to recycled water services, payment of a special infrastructure contribution of approximately $1.3m and the further payment to Council of $1,920,000 in development contributions pursuant to s 7.11 of the E**nvironmental P**lanning and A**ssessment Act 1979 (NSW) (EPA Act). Subject to minor points of detail, the relevant conditions did not change between the original consent of April 2019 and the modification approved in October 2021.
The negotiations between the Cauchis and Mr Galea led to the preparation of a draft land swap deed by solicitors for Mr Cauchi in July 2020. Negotiations were conducted by reference to the draft deed between July 2020 and March 2021. Orion was evidently engaged in those communications for Mr Cauchi. On 22 December 2020, Mr Joshua Pineda of Orion sent an email to Mr Cauchi which included the following:
That argument was not accepted by the trial judge. On appeal, MPI does not contend that cl 4.1(b) should be construed as referring to the costs incurred by MPI in connection with satisfying the conditions of the subdivision consent. MPI instead accepts that the Land Swap Deed was more confined in its operation, and dealt only with the respective transfer of areas of land (so as to ensure single ownership of each affected lot following the subdivision), and agreement between the parties that as far as the earthworks to be performed by WEM was concerned, they were each responsible for their own land, just as they were separately responsible for the development and servicing of the particular lots identified in cl 4.1(b) and (c).
Having adopted this approach to the Land Swap Deed, MPI submitted that there was a broader arrangement, not reflected in the terms of the Land Swap Deed, by which it was understood that Mr Cauchi (or entities associated with him) would assume responsibility for the payments and works necessary to progress the subdivision and satisfy the conditions of the development consent. From this factual foundation, MPI sought to urge two conclusions for the purposes of its claim in restitution. The first is that PMG must be taken to have impliedly requested that Mr Cauchi (or entities associated with him) make those payments and undertake such works. The second, advanced in the alternative to the first, is that PMG took the benefit of the services provided and payments made by MPI in circumstances where a reasonable person should have known that MPI expected to be paid for them.
The asserted legal significance of the second conclusion is explained further below. For the present, it is important to record other findings of the trial judge and other aspects of the evidence that bear on the underlying factual premise. At the hearing of the appeal, counsel for MPI was asked if the trial judge had been asked to make findings about an arrangement of this kind. Mr Pokoney frankly conceded that at trial the restitutionary claim had not been expressed in the same terms. However, he drew attention to MPI’s argument at trial that there was an implied agreement between Mr Cauchi and Mr Galea about the sharing of costs, which drew on essentially the same factual contentions. The Court was referred in that context to the following features of the evidence and submissions below:
the submission of MPI that an oral agreement first arose between Mr Cauchi and Mr Galea from conversations between them in mid-2018 to 2019; and
Mr Cauchi’s affidavit evidence of 2 September 2023 in which Mr Cauchi asserted that he met with Mr Galea during the period from mid-2018 to 2019 and together they reached an agreement:
Mr Cauchi’s evidence on these matters did not improve under cross-examination. Indeed, the cross-examination confirmed that Mr Cauchi’s evidence was even less reliable than was apparent from the affidavits themselves:
The notion that unjust enrichment may be established where work is performed at the express or implied request of the party receiving the benefit is consistent with well-established principles: see Lumbers v W Cook Builders Pty Ltd (in liq*)* (2008) 232 CLR 635; [2008] HCA 27 at [89]; Lampson (Australia) Pty Ltd v Fortescue Metals Group Ltd (No 3) [2014] WASC 162 at [88]; Mason & Carter’s Restitution Law in Australia (5th ed) at [154]-[156]. MPI’s argument on appeal goes a step further in arguing that, even in the absence of such a request, “free acceptance” of the benefit is sufficient as an unjust or vitiating factor.
MPI accepted that there is uncertainty about whether this is correct under Australian law. In Hegarty v Keogh (No 2) [2023] SASCA 30 at [196] the South Australian Court of Appeal considered, but rejected on the facts, a claim for restitution based on free acceptance, in circumstances where it does not appear to have been disputed that such a claim would be viable. In LCM Operations Pty Ltd v Rabah Enterprises Pty Ltd [2023] NSWSC 590 at [209] Rees J observed that the proposition that “free acceptance” is a sufficient unjust factor to warrant restitution remained a matter of debate. To similar effect, Peden J in Atlanta Building Pty Ltd v Abdela (No 3) [2025] NSWSC 730 at [69] said that it remains controversial to treat free acceptance as an unjust factor and described the position in Australia as unclear. In Lampson, Edelman J declined to strike out a pleading seeking restitution based on free acceptance. His Honour noted that the plurality judgment of the High Court in Lumbers did not expressly reject the possibility that liability could be based on an unjust factor arising from acceptance of a benefit, with knowledge that it was not provided gratuitously, and without taking a reasonable opportunity to reject the benefit. In doing so, his Honour did not find that “free acceptance” was established in Australian law as a sufficient unjust factor. Edelman J was instead satisfied that difficult questions of principle, including this, are best assessed against concrete findings of fact and it was inappropriate to strike out the claim.
This is not the case in which to resolve the controversy. That is because the appellant has failed to establish the factual foundations for its submission that PMG freely accepted benefits from MPI, in the sense necessary to sustain the claim in restitution, even assuming that free acceptance would be sufficient.
When pressed to explain what is entailed in the concept of free acceptance, counsel for MPI referred to the judgment of Heydon JA in Damberg v Damberg (2009) 52 NSWLR 492; [2001] NSWCA 87, in which his Honour at [192] quoted from Goff and Jones, The Law of Restitution (5th ed, 1998, Sweet & Maxwell Ltd) at 18-19, where the learned authors said:
MPI cannot point to anything inherent in the nature of the arrangements between the parties, or addressed in the communications and negotiations between the parties, that implies a request or that would have led a reasonable person in the position of Mr Galea or PMG to appreciate that Mr Cauchi or MPI expected to be paid. It is significant that the subdivision project was initiated as a project by the Cauchis before the Galea Property was drawn into the proposal and before any engagement with Mr Galea. Mr Cauchi, through MPI, assumed and retained responsibility for progressing the payments and works required to satisfy the conditions of consent for the subdivision. The responsible project manager, initially Project Surveyors and then Orion, was retained by the Cauchi interests and appears to have acted on the instructions of the Cauchis only.
What transpired once the Cauchis decided to seek to expand the proposal to incorporate the Galea Property is critically important. The evidence, including from Mr Cauchi himself, demonstrated that the negotiations between the parties were focused on the incorporation of the Galea Property and the land swap that was necessitated by the particular form of the subdivision of the land traversing the Cauchi and Galea properties. It would have been natural in that context for questions to arise about the costs of progressing the subdivision, including the costs of satisfying the conditions of consent, and whether or not Mr Galea and PMG were expected to share in the burden of those costs, as a condition of becoming part of the subdivision proposal. That is particularly so in circumstances where the conditions of consent were known well before the parties negotiated and made the Land Swap Deed.
At the same time, if such questions had been addressed by the parties, there would have been significant points of uncertainty to address. In particular, if the parties were expected to share in the overall costs associated with the subdivision project, what would be the guiding principles for determining the respective allocation? And how, if at all, would that take into account the Polistinas? MPI cannot point to any evidence that such questions were ever addressed, even indirectly.
The point is reinforced by what in fact transpired when MPI came to demand a contribution from PMG. Mr Cauchi took it upon himself to divide up the respective costs, and adopted very different approaches in respect of different cost categories. For example, for Authority and Consultant costs, MPI demanded that PMG pay one-third of the total costs. For Edwards Road Construction costs, MPI demanded that PMG pay one-quarter of the total costs. For the Section 7.11 Contributions, MPI demanded that PMG pay 8% of the total costs (calculated by reference to the proportion of individual residential lots to be held by PMG). Yet for the special infrastructure contribution costs, as part of the broader category of Contribution Costs, MPI demanded that PMG pay 11.5% of the total costs (calculated by reference to proportion of total land area). Mr Cauchi in his evidence, and MPI in its submissions, did not seek to defend these chosen proportions as reflecting any specific arrangement reached between the parties. Nor did they seek to explain why a reasonable person in the position of PMG would have appreciated that there was not only an expectation that MPI would be reimbursed, but that the expectation was that costs would be apportioned on these various bases. Rather, the allocations were chosen essentially at the whim of Mr Cauchi. That only tends to reinforce the absence of any arrangement or objectively apparent expectation of shared contribution.
What is conspicuous is that the Cauchis and PMG proceeded to negotiate and resolve a written agreement that dealt with other matters, but did not impose any obligation on PMG to contribute to the costs incurred by MPI. MPI no longer seeks to argue that the Land Swap Deed contained such an obligation, or was complementary to an arrangement to the same effect. Instead MPI seeks to argue that independently of the Land Swap Deed there was an arrangement about cost sharing, which in turn provides the basis to conclude that there was an implied request for the services to be provided or at least that a reasonable person in the position of PMG would have known that there was an expectation that PMG should pay for those services. The evidence does not substantiate that theory.
The evidence given by Mr Cauchi on these matters was in many respects unclear and incoherent. Mr Cauchi made a number of bald assertions in his evidence about the parties having reached an arrangement or agreement to this effect. However, when properly analysed his evidence reduces to the proposition that there were conversations of an unspecified kind and negotiations which culminated in the Land Swap Deed, which agreement was intended to capture the entire agreement between the parties about the subdivision (as is expressly reflected in cl 8.6).
Though framed in terms of Mr Cauchi’s subjective understanding, the evidence is also significant when it comes to characterising objectively the circumstances as between the parties that are said to make it unjust for PMG to have taken the benefit of MPI’s services without paying for them. Given MPI’s concession on appeal that the Land Swap Deed did not in fact deal with the topic of contribution to the costs of the subdivision, Mr Cauchi’s acceptance that the Land Swap Deed was intended to document the entire arrangement means that his evidence touching on the conversations from mid-2018 cannot coherently be said to demonstrate that there was a separate arrangement governing the sharing of costs of the subdivision. In light of Mr Cauchi’s own evidence about how he approached the negotiations with Mr Galea, it is inherently unlikely that the communications between the parties would have been such as to engender a reasonable person to appreciate that there was an expectation of payment that existed independently of the Land Swap Deed.
The point is even stronger given the contemporaneous documentary evidence that is consistent with Mr Cauchi’s understanding. The email from Mr Pineda of Orion to Mr Cauchi on 22 December 2020 described a discussion with Mr Galea “about expectations during the subdivision development”. Those expectations as described in the email did not include any reference to Mr Galea or PMG being expected to contribute to the overall subdivision costs. Instead, the expectations were confined to the arrangements that later found expression in the Land Swap Deed.
But in any event, nothing in the evidence of Mr Cauchi provides a sound basis to find that an arrangement existed, outside the Land Swap Deed, for the sharing of development costs. No sensible conclusions could be drawn from Mr Cauchi’s evidence about conversations between himself and Mr Galea. Mr Cauchi was shown on cross-examination to have no recollection of the content of those conversations. Nor does MPI point to any documents evidencing the alleged arrangement. The email from Mr Pineda of December 2022 is directly contradictory to MPI’s submission and MPI has not explained why the Court should conclude that Mr Pineda was wrong in his description of the “expectations during the subdivision development”.
MPI argues that in circumstances where PMG acquiesced in works being carried out and payments being made which were to the benefit of all the parties to the subdivision, including PMG, it must follow that PMG was impliedly requesting that this occur or that PMG should have understood that it would be required to make a financial contribution. For example, PMG was aware that at least some work (of an unspecified kind) was done by MPI on the Galea Property. This argument was pitched at a level of generality, and necessarily so in circumstances where MPI did not prove when particular expenses were incurred and what, if anything, PMG knew about the expenses being incurred at the time. Any such alleged acquiescence has to be assessed in a context where PMG and MPI were negotiating an express agreement that reflected expectations during the subdivision development and recorded their respective obligations. Once that context is appreciated, the supposed acquiescence in relation to costs not addressed in the Land Swap Deed loses any force.
MPI sought to make something of the fact that PMG and/or Mr Galea had made admissions or concessions in the course of the proceedings to the effect that they had obtained benefits to the value of approximately $200,000 and were prepared to contribute that amount. The matters referred to by MPI do not withstand scrutiny. PMG indicated a willingness to compromise the proceedings on terms which included making a payment to MPI. A settlement offer of that kind made in the context of proceedings says nothing about whether or not an arrangement of the kind alleged by MPI existed prior to the Land Swap Deed. PMG also obtained evidence from an expert about methods of apportionment, by way of answer to the apportionment of costs claimed by MPI. Obtaining evidence of that kind does not constitute an admission of liability or evidence of an underlying historical arrangement.
Mr Maroya submitted that upholding MPI’s claim for restitution would be inconsistent with the contractual allocation of risks and obligations reflected in the Land Swap Deed. In making that submission, Mr Maroya seeks to call in aid the proposition that restitutionary claims “must respect contractual regimes and the allocation of risk made under those regimes”, and that it is not the function of restitution to “disturb or interfere with that allocation”: Mann v Paterson Constructions Pty Ltd (2019) 267 CLR 560; [2019] HCA 32 at [14]-[18], quoting from Lumbers at [46] per Gleeson CJ. If MPI were correct in its contention that there was an arrangement about the sharing of costs that existed and continued independently of the Land Swap Deed, the principles invoked by Mr Maroya would not be a good answer, in the sense that the contractual regime that existed between the parties was intentionally confined to particular matters only and did not touch the arrangement concerning cost sharing. The problem for MPI is that it cannot substantiate such a contention.
MPI bears the burden of demonstrating that there was an implied request or, on its free acceptance theory, that a reasonable person in the position of PMG would have known that PMG was expected to pay for the services which PMG took the benefit of, and which PMG did not decline despite having the opportunity to do so. MPI has failed to discharge that burden in each respect.
The orders that I would make are:
Appeal dismissed.
The appellant is to pay the respondent’s costs.
GRIFFITHS AJA: I agree with Free JA.