DETAIL UNIT 1
38 I will first deal with schedule B to Mr Oliveri's affidavit concerning unit 1. The first item in that schedule is item 1 income, which income is shown as nil. I have already held that he is not liable for his occupation of unit 1. If he had been liable the relevant income would have been $26,520. So far as expenses are concerned the parties are agreed that the correct quantum of items 3 to 34 is $2,729.38. The only other item in contention is item 35 which relates to contributions to the mortgage between the 24 December 1993 and 18 February 1994. The amount claimed is $749. The basis for this claim was said to arise from the fact that the funds which had been collected by Mr Oliveri and deposited to an account from which the mortgage payments were deducted have been taken by the trustee following bankruptcy. It appears, however, that when one considers the account there is a miscalculation and Mr Oliveri concedes that because two payments of mortgage amounts came out of the account at the relevant time the first amount is not payable. The trustee on the other hand contends that there should be an allowance the other way in the sum of $372 because the mortgage paid for the rent collected that year from monies saved in that earlier year. Given that the accounting for rent and mortgage payments in annexure A is expressed to be for a whole year this submission would not appear appropriate. Accordingly, all that is necessary, if it were necessary to decide the matter, is to reject Mr Oliveri's claim for an amount for $749.
39 I say, "if necessary" because I do not think that Emanueli Oliveri has demonstrated an entitlement to recoup any of these expenses. There is no suggestion that the trustee, knowing that he was carrying out these minor maintenance matters, deliberately stood by and let him incur the expenditure. Mr Oliveri had the benefit of occupation and these expenses were simply an incident of that occupation.
DETAIL UNITS 2, 3 AND 4
40 I turn to the account contained in annexure A which is in respect of units 2, 3 and 4. Before dealing with the individual items it is worth noting that in this account we are mostly dealing with falsifications and, accordingly, the onus is on the accounting party. The other matter that should be noted at the commencement is the extraordinary lack of records maintained by Mr Emanueli Oliveri. He well knew that a claim was being made by the trustee of his brother's estate and accordingly one would have thought that some care would have been taken in regard to records. His explanation for the somewhat abysmal records he has kept is that he never believed that he would have to account. The lack of records was extensive. He issued no rent receipts for the whole period of his management and he had no records such as a cash book dealing with receipt of income and payment of expenses. So far as receiving the rent is concerned most of it was received in cash and what few cheques were received from one tenant were banked in the account which was used to pay for the mortgage. When he received cash he mixed it with his own money and did not differentiate. Frequently in respect of many of the claims he makes in this accounting he has no records and merely provides an estimate based upon his memory of events many years prior to the time of him swearing his affidavit a mere few days before the hearing before me in this matter. Fortunately, for Mr Oliveri, the trustee has taken a somewhat realistic approach and has admitted a number of claims which seem reasonable but for which no proof was available.
41 The first items in dispute are items 4 to 7 which cover periods of vacancy for the first year. Eight weeks has been claimed from 26 February 1994 to 17 April 1994. In the second year he also claims 8 weeks item 76 and in the third year he claims 3 weeks for unit 2 between 10 and 30 November. The only documents which give any indication or allow any basis for the first claim are three advertisements which were placed in the Sydney Morning Herald. These covered a period of ten days with the possibility of one other some time earlier. In cross examination he suggested that he may have looked at other documents in the Federal Court but no such documents were produced. Given the absence of documentation and the generality of Mr Oliveri's evidence I do not accept this claim except to the extent conceded by the trustee. This concession was that the trustee would allow a vacancy rate of one week per unit per year. The amount allowed is $510.
42 Items 74 to 76. There was, once again, a short period of advertisement and, for the reasons expressed above, the amount allowed is $510.
43 Item 126. This claim in the sum of $510 should be allowed as it accords with the trustee's concession.
44 Items 9 and 10 relate to no bond being available. This is a loss of rent for several units as a result of tenants vacating without paying rent. Mr Oliveri was not able to recover as he did not hold any bond. Under his management of the units no written tenancy agreements were executed and he took no bonds from any of the tenants. Cross examination seems to indicate that he has some memory of the occasion in the first year. Thus on a factual basis, I accept he did not receive the rent. In respect of items 78 for the next year his explanation at transcript 67 and 68 was not consistent with the only document available and I would not accept it on a factual basis. In the 3rd year the claim is not made. The failure to obtain a bond in the first year was a clear breach of proper prudence in managing the property. However, there has not been an order for the taking of accounts on the basis of wilful default which would have meant that the accounting must be for not only receipts and payment actually received and made by him but also for all monies he would have received if he had managed the property prudently. As the matter is not a mortgagor and mortgagee case there is no entitlement to an account on the basis of wilful default unless at least one example of wilful default is alleged in the pleadings and proved at the trial. This did not happen and, accordingly, the amount of rent not received in the first year must be taken into account in favour of Emanueli Oliveri.
45 Item 18. Water rates. This item was calculated by Mr Oliveri from one quarter's voucher which included charges for arrears and probably some recovery fees. An examination of cheque butts showed that the most likely amount for rates for the year is $1,615 and accordingly this amount should be allowed and $176.80 rejected. Water rates also occurred in subsequent years at item 86 where the correct amount to be allowed is $1,687.60 leading to a rejection of $104.20. Mr Oliveri agrees with this rejection. In the third year water rates are item 140. Based upon the cheque butts the correct allowance should be $1,718.15 with $73.65 disallowed.
46 Item 22. Pest control. This has been claimed in each year in the sum of $444. When one goes to the first claim at item 22 only one account for $240 was produced. There appears to be evidence of only two amounts, one of $240 in this year and one for $220 somewhat later. Mr Oliveri says that it was done every six months and he allowed the tenants to organise the treatment to suit their convenience. I am prepared to accept his evidence as it is likely that the tenants would not allow the matter to be left in abeyance. Items 22, 90 and 14 are allowed in the amount claimed, namely, $440 each..
47 Item 23. This is a claim for gardening in an amount of $200. No dockets are available and it is apparent that cash amounts were paid from time to time for gardening work. This also appears at items 91 and 147. The comment in document 54 suggests that there was a vegetation build up but I am not satisfied that it establishes that gardening was not done. I do accept that some was done and I am prepared to accept these figures given the small nature of them.
48 Item 24. Lock replacement and key cutting at $300. There are no documents for these items and clearly it is a round figure estimate with no detail. It should be disallowed.
49 Item 25. Security door repair. This likewise has no documents and is from recollection and given in a round figure. It should be disallowed.
50 Item 26. Replace wrought iron and driveway gates $500. This item is from recollection only and no documentary proof and is a round figure. It should be rejected.
51 Item 27. Roof repair $800. This is the same as above and should be rejected.
52 Item 28. Window repair $200. This is the same as above and should be rejected.
53 Item 33. Repair to rear fire escape landing $1,200. There were three quotes which were not accepted and instead Mr Oliveri said he used a cash worker to repair it. He cannot recall his name but recalls the amount. In the circumstances and given the description of the work I am prepared to allow this amount.
54 Item 34. Professional cleaning $200. This is a similar item to items 98 and 154 except that the latter two claimed $250. No records were available and the figures are really estimates of what would be cash payments. They are minor amounts and I propose to allow them as I am satisfied that cleaners were engaged.
55 Item 56 on 24 June $74 for plumbing. There is no document for this and it is apparently a mistake. Mr Oliveri agrees it should be rejected.
56 Item 97. Window repair sash cords. There are no documents and cross examination demonstrated no recollection of facts which would support the claim. It should be disallowed.
57 Item 101. Emergency call $100. This seems to be an error the date having been taken from another document wrongly. I would disallow this sum.
58 Item 102. Unit 2 May 1995 purchase of second hand stove $350. Item 105 unit 3 July 1995 purchase of second hand stove $300. There are no documents to support these and they are merely from memory. The recollection does seem to have a basis because earlier he had bought a new stove and on these occasions he looked for second hand ones. I am prepared to allow these amounts.
59 Item 110. $5,800. These are costs for repairs to walls and rising damp. There is produced an account from Mr Steve Toff which details the work and indicates that the amount has been paid. It is suggested that no record could be found of him as a plumber but this is not conclusive particularly given that Mr Oliveri says he met him at a coffee shop. Given the documentation I am prepared to accept it.
60 Item 146. Fencing on the northern boundary. There are no documents for this and it was paid in cash. However, there is a photograph which shows a small indication of new fencing. In the circumstances I propose to allow this item of $255.
61 Item 152. Repair to a gas heater $175. The claim for this arises from document 55. From my interpretation of that it seems fairly clear that the tenant is claiming $45 as an amount he paid to the repairer and accordingly I would allow this amount in the sum of $45.
62 Item 149. It should be noted that this amount is accepted in full at $64.
63 Item 153. It should be noted that this amount is accepted by the trustee in full at $390.
PROFIT ON SALE OF PROPERTY
64 There was a suggestion in argument that because the trustee had now sold the property at a price in excess of its value in 1993, that he had made a profit and no damage could be proved. There is evidence before me that I accept which sets out clear reasons why the trustee could not sell the property before the conclusion of the litigation. However, there is no causal connection between the cross defendant's management of the premises and the ultimate sale of the premises by the trustee. He was entitled to the benefit of that sale whenever it occurred. See the discussion in a similar area in Hussey v Eris (1990) 1 All ER 449 and Monroe Schneider Associates (Inc) v No 1 Raberem Pty Ltd 33 FCR 1 at 27.
65 I direct the parties to bring in short minutes, argue interest and costs and deal with any remaining matters such as evidence in respect of agent's fees.