Penya v Penya

Medium Neutral Citation: Penya v Penya [2025] NSWSC 805

Hearing dates: 8 – 11 October 2024

Date of orders: 23 July 2025

Decision date: 23 July 2025

Jurisdiction: Equity - Real Property List

Before: Williams J

Decision: 2023/143366
See orders at [218].
2023/33949
See orders at [219].

Catchwords: ESTOPPEL – proprietary estoppel by encouragement – where plaintiff is the daughter of the defendants who are co-owners of property – where plaintiff claims the defendants made repeated representations to her that, if she worked full-time in the parents’ real estate business without pay, she would be “given” the property and the business within her parents’ lifetime – where plaintiff did work in the business without pay for approximately 22 years – where first defendant (father) has sold the rent roll of the business and, in separate proceedings, seeks an order under s 66G of the Conveyancing Act 1919 (NSW) for the sale of the property – where plaintiff claims the defendants are estopped from denying her alleged entitlement to have the property transferred to her, hold the property on constructive trust for her, and should account to her for proceeds of sale of the rent roll – Held: alleged representations were not made, proprietary estoppel claim fails
EQUITY – trusts – common intention constructive trusts – where plaintiff is the daughter of the defendants who are co-owners of property – where plaintiff claims the parties agreed or had the common intention that, if the plaintiff worked full-time in the parents’ real estate business without pay, she would be “given” the property and the business within her parents’ lifetime – where first defendant (father) has sold the rent roll of the business and, in separate proceedings, seeks an order under s 66G of the Conveyancing Act 1919 (NSW) for the sale of the property – where plaintiff claims the defendants hold the property on constructive trust for her and should account to her for proceeds of sale of the rent roll – Held: alleged common intention or agreement not established, constructive trust claim fails
EQUITY – trusts –constructive trust following failure of alleged joint endeavour – where plaintiff is the daughter of the defendants who are co-owners of property – where plaintiff claims the parties were engaged in a joint endeavour to “enhance the material wellbeing of their family” pursuant to which the plaintiff worked in the parents’ real estate business without pay – where plaintiff claims the defendants have received a windfall benefit arising from applying revenue of the business to repay loans secured against the property – where first defendant (father) seeks in separate proceedings an order under s 66G of the Conveyancing Act 1919 (NSW) for the sale of the property – where plaintiff claims the defendants hold the property on constructive trust for her – where subject property was acquired prior to the commencement of the alleged joint endeavour – Held: alleged understanding or joint endeavour not established, constructive trust claim fails
LAND LAW – co-ownership – statutory trust for sale – application by plaintiff (father) under s 66G of the Conveyancing Act 1919 (NSW) – where plaintiff and first defendant (mother) are co-owners of property – where first defendant has filed a submitting appearance – where claim by second defendant (daughter) that property is held on constructive trust for her fails – trustees for sale appointed – no question of principle

Legislation Cited: Conveyancing Act 1919 (NSW), s 66G
Evidence Act 1995 (NSW), s 140

Cases Cited: Baumgartner v Baumgartner (1987) 164 CLR 137; [1987] HCA 59
ET-China.com International Holdings Ltd v Cheung (2021) 388 ALR 128; [2021] NSWCA 24
Ferella v Official Trustee in Bankruptcy [2015] NSWCA 411
Foundas v Arambatzis [2020] NSWCA 47
Fox v Percy (2003) 214 CLR 118; [2003] HCA 22
Galati v Deans [2023] NSWCA 13
Hellenic Property Holdings Pty Ltd v Makaritis [2025] NSWCA 13
Hogan v Baseden (1997) 8 BPR 15,723
John Holland Pty Ltd v Kellogg Brown & Root Pty Ltd [2015] NSWSC 451
Kramer v Stone (2024) 421 ALR 106; [2024] HCA 48
McKinlay v Woods [2024] NSWCA 122
Moubarak by his tutor Coorey v Holt (2019) 100 NSWLR 218; [2019] NSWCA 102
Muschinski v Dodds (1985) 160 CLR 583; [1985] HCA 78
Pascoe v Dyason [2011] NSWSC 1217
Singh v AKM Investments Group Pty Ltd [2024] NSWCA 268
Vacation Club Ltd v A GG Properties Pty Ltd (2019) 19 BPR 39,799; [2019] NSWSC 1357
Warner v Hung; In the matter of Bellpac Pty Ltd (receivers and managers appointed) (in liquidation) (No. 2) (2011) 197 ALR 56; [2011] FCA 1123
Watson v Foxman (1995) 49 NSWLR 315
Williams v Legg (1993) 29 NSWLR 687
Woodson (Sales) Pty Ltd v Woodson (Australia) Pty Ltd (1996) 7 BPR 14,685
Zhang v Metcalf [2020] NSWCA 228
Zugic v Vesuvius Australia Pty Ltd [2020] NSWSC 106

Texts Cited: N/A

Category: Principal judgment

Parties: 2023/143366
Paula-Marie Penya (Plaintiff)
Paul Penya (First Defendant)
Therese Penya (Second Defendant)
2023/33949
Paul Penya (Plaintiff)
Therese Penya (First Defendant)
Paula-Marie Penya (Second Defendant)

Representation: 2023/143366
Counsel:
Ms J Mee with Mr T Maybury (Plaintiff)
Mr G George (First Defendant)
Mr P Wallis (Second Defendant)
Solicitors:
Russell Kennedy Lawyers (Plaintiff)
Eaves Legal (First Defendant)
VRT Lawyers (Second Defendant)
2023/033949
Counsel:
Mr G George (Plaintiff)
Mr P Wallis (First Defendant)
Ms J Mee with Mr T Maybury (Second Defendant)
Solicitors:
Eaves Legal (Plaintiff)
VRT Lawyers (First Defendant)
Russell Kennedy Lawyers (Second Defendant)

File Number(s): 2023/143366
2023/33949

Publication restriction: N/A

JUDGMENT

Introduction

1. These proceedings concern a dispute between family members over property at 11 Robinson Street, Eastlakes, New South Wales, being lots 28 and 30 in Deposited Plan DPXXX, and a dispute between father and daughter over the entitlement to the proceeds of sale of the rent roll of a real estate business founded by the father and in which the daughter claims to have worked without pay on the basis of certain promises.

2. Mr Paul Penya, and his former wife Ms Therese Penya, are the registered proprietors of the Eastlakes property as tenants in common. They purchased the property in October 1984, and lived there together with their daughter Ms Paula-Marie Penya until 1995 when Paul moved out of the property following the breakdown of the marriage between himself and Therese. Therese and Paula-Marie continued living in the property. In July 2004, Paula-Marie married Mr Andrea Pizzimento, who then moved into the property with Therese and Paula-Marie. Andrea and Paula-Marie continued living in the property with Therese after the birth of their children in August 2013 and November 2014.

3. Paul and Therese are the directors and shareholders of Matra Real Estate Pty Limited, which operated a real estate business in Matraville at all times relevant to these proceedings. Paul was the principal licensee in charge. Paula-Marie worked in the business from March 1996 until its rent roll was sold in 2018.

4. On 1 February 2023, Paul commenced proceeding no. 2023/33949 in this Court seeking an order pursuant to s 66G of the Conveyancing Act 1919 (NSW) for the appointment of trustees for the sale of the Eastlakes property (the s 66G proceedings).

5. On 4 May 2023, Paula-Marie commenced proceeding no. 2023/143366 against Paul and Therese claiming that her parents had promised to give her the Eastlakes property and the Matra Real Estate business in return for her working in the business without being paid a wage. Paula-Marie claims:

6. a declaration that Paul and Therese hold their interests in the Eastlakes property on constructive trust for her, and an order requiring them to transfer their interests in the Eastlakes property to her; and

7. an order that Paul account to her for the proceeds of sale of rent roll of the business.

8. Paula-Marie’s claims rely on the doctrine of proprietary estoppel by encouragement or, alternatively, common intention constructive trust or a constructive trust following the failure of an alleged joint endeavour. During closing submissions on the final day of the hearing, Paula-Marie abandoned her pleaded claim relying on the doctrine of promissory estoppel.

9. I will adopt the parties’ convention of referring to the proceedings commenced by Paula-Marie as the trust proceedings.

Salient evidence

13. Paul and Therese purchased the Eastlakes property in about October 1984 as joint tenants. As referred to later in these reasons, Paul severed the joint tenancy in about September 2022. Paul and Therese have held the property as tenants in common in equal shares since that time.

14. In 1986, Paul and Therese purchased the Matra Real Estate business. Paul and Therese are the directors and shareholders of Matra Real Estate Pty Ltd through which the business was operated. Therese played no active role in the business. Therese was working at Australia Post when she and Paul purchased the Eastlakes property and the Matra Real Estate business, and was still working at Australia Post at the time of the hearing.

15. At all times relevant to these proceedings, the Matra Real Estate business involved the sale of properties and the management of rental properties on behalf of landlords. The business earned commissions in respect of properties sold and management fees in respect of rental properties managed.

16. In about 1992 or 1993, Paula-Marie met Andrea. They formed a lasting relationship. They married in July 2004.

17. In 1995, Paula-Marie attended the Metropolitan Business College in Sydney to undertake a course. Paula-Marie worked in the Matra Real Estate business one day a week while studying at the College. Therese was hoping that this would lead to a role for Paula-Marie in the Matra Real Estate business. Therese gave evidence that, as the directors of Matra, she and Paul did not pay a wage to Paula-Marie for her part-time work during 1995. By way of explanation, Therese deposed:

“Paula is our only child and will be inheriting all of our assets. The main assets we have are the business Matra and the property. Paul and I often had discussions about this and said words to the effect:

Paul: ‘I’m not paying Paula because she will inherit everything anyway, she’s our only child.’

Paul: ‘When Paula is ready, she will take over the business, it’s all going to be hers one day anyway.’

Me: ‘Yes, Paula will get the house and the business, and everything else, she’s our only child, but you should still give her a wage.’”

18. Paul gave evidence denying that any such conversation occurred.

19. At the end of 1995, Paula-Marie was awarded an Advanced Certificate in Administration and Business Computing. She then accepted a temporary, casual position until March 1996 performing data entry and administrative work at a firm known as UPS.

20. At some stage in about 1995, Paul and Therese separated, and Paul moved out of the Eastlakes property.

21. Paula-Marie gave evidence that Paul asked her in March 1996 to start working full-time at Matra Real Estate. In her affidavit sworn on 9 August 2023, Paula-Marie deposed:

“24. … Dad told me that he had two girls working for him who were not very good and it was costing him too much money to pay them a wage. I asked him what I would be paid to work full time. Dad told me that I wouldn’t get paid anything but it didn’t matter because everything was going to be mine anyway. He said that everything that he and Mum owned including the business and the Property would be mine, but if I needed money for anything I should just let him know and he would give me money, which he could do by getting a cash advance on his credit card. He said that I was their only child and he and Mum were going to give me everything. Dad said that if I worked in the business this would be like sacrificing my wage to get a business when he retired and also the house.

25. Mum also told me around this time that I should go to work fulltime with Dad at Matra and said that it would be mine anyway just like the house.

26. When I got home on the day I discussed this with Dad, I told Andrea about the conversation that I had with Dad about me working fulltime at Matra but not getting paid. I explained to Andrea that Mum and Dad had told me the business and the house would be mine. Andrea told me that he was not happy about the idea of me working for nothing because we needed money to live on. I told him that Dad had told me this was like sacrificing my wage to get a business and house afterwards and that I thought this was worth it. I told Andrea that working full time doing all the work that needed to be done in the business was going to be worth it in the end. While Andrea showed concern and said that this plan didn’t seem right to him, he accepted that I was willing to work at Matra as Dad had requested.

27. After I began working fulltime at Matra in 1996, Mum and Dad frequently told me in conversations about the business or home that everything they owned including Matra and the Property would be mine. They each said that I would get the business when Dad retired. They said this when we were alone as well as in front of relatives and friends. It never occurred to me to question it because of how often they said this to me as their only child. They each made these statements to me on numerous occasions over the following years.”

22. In cross-examination, Paula-Marie adhered to her account of the conversation that she says she had with Paul as set out in paragraph 24 of her affidavit sworn on 9 August 2023. She recalled that the conversation took place at the Matra Real Estate office after her father had picked her up from work at UPS one day and taken her back to his office because he had something to do there.

23. In her affidavit sworn on 18 August 2023, Therese gave evidence that Paula-Marie had told her in about 1996 that she had asked Paul how much she would be paid for working full-time in the business, and that Paul had said she would not be paid but that this did not matter because she would end up with everything. According to Therese’s evidence, Paula-Marie asked Therese if she shared Paul’s view. Therese replied to Paula-Marie, “well yes you will end up with everything, you know that, everything will be yours” and “you should go and work full time with dad, learn the business from the ground up and one day it will all be yours”.

24. In his affidavits sworn on 8 August 2023 and 30 November 2023, Andrea deposed that Paula-Marie had told him in about 1995 that she had agreed with her parents that she would work full-time in the Matra Real Estate business and that, instead of being paid for that work, she would be given the business and the Eastlakes property in the future. Andrea told Paula-Marie that they needed money to live on. Paula-Marie told him that everything would work out. Andrea accepted this, but he continued to worry about it.

25. Paul gave evidence denying that he had a conversation with Paula-Marie to the effect referred to at [21] above. He gave a very different account of how Paula-Marie came to work at Matra Real Estate in 1996. According to Paul’s evidence, he returned from an overseas holiday to find that Therese had sacked the secretary employed in the business. Therese told him that Paula-Marie would be working there in her place. Paul deposed that he was “astounded” by this and argued with Therese about it, but Therese held firm. Therese gave evidence denying this. Asked in cross-examination why he didn’t simply tell Paula-Marie to leave, Paul said that she was his only daughter, he believed that she had been dismissed from her position at UPS, and it felt too hard to ask her to leave Matra Real Estate.

26. In cross-examination, Paul maintained his denial that he ever promised Paula-Marie the Matra Real Estate business or the Eastlakes property in return for working in the business without a wage or salary. Paul emphasised the cash payments that he did make to Paula-Marie while she was working at Matra Real Estate, and the investment properties that he helped her and Andrea accumulate over the years. As will be seen below, Paul made cash payments of about $1,000 to Paula-Marie each time he sold a property for Matra Real Estate. According to Paula-Marie’s evidence, those payments amounted to a total sum of about $79,000 over the whole of the period that she worked in the business. Paula-Marie and Andrea own four investment properties, three of which they purchased with financial support from Paul and Therese. Paul said that he did tell Paula-Marie that the business was going to be hers one day in any event, and that he would have trained her up in time for her to take it over if she had not been working there.

“37. … Dad said that this was a small sacrifice for what I was going to end up with and I should remember that I’m going to end up with the business and the house as mine.

38. Mum said that she agreed with Dad and that it would all be worth it and my working in the business was a small sacrifice for everything I would end up with in the end. Mum and Dad both said that the business and the house together will be worth a lot of money.”

28. Therese gave evidence of a similar conversation, although she recalls it taking place in early 1998.

29. Therese also gave evidence that she and Paul, in the presence of one another, made many similar statements to Paula-Marie over the years, and told her that she needed to get her real estate licence so that she could “take over the business when dad retires”.

30. Paul gave evidence denying that the conversations referred to at [27]-[29] above ever occurred.

31. In December 1997, Paula-Marie obtained a Certificate IV in Business in Property Management with Distinction. In December 1998, she obtained a Diploma of Business in Real Estate Management with Distinction.

32. Paul was the principal licensee in charge of the Matra Real Estate business and was its chief salesperson. Paula-Marie worked in the rental property management side of the business.

33. In her affidavit sworn on 9 August 2023, Paula-Marie gave evidence that she had many responsibilities, including dealing with tenants and landlords, conducting inspections for incoming and outgoing tenants, preparing leases, arranging maintenance, repairs and renovations for the properties under management, receiving rent from tenants, daily banking and book-keeping, preparing end of month statements, preparing material for and appearing at tribunal hearings in relation to disputes with tenants, dealing with evictions, and preparing Business Activity Statements for Matra Real Estate and any documents required by its accountant. According to Paula-Marie, the business did not have any other full-time workers, Paul did not come into the office on most days, and he contributed little to running of the business even when he was present.

34. According to Therese, Paula-Marie, and Andrea, Paula-Marie worked extremely hard. Paula-Marie described her workload as being the equivalent to what would ordinarily be done by three or four people.

35. In cross-examination, Paula-Marie acknowledged that Matra Real Estate’s rental property management business was very modest, with only about 30 properties on the rent roll, and that her job was simply to look after that modest rent roll and to do the accounts for the business.

36. According to Paul’s evidence, Paula-Maria often phoned in sick and did not come to work. When she was at the office, Paula-Marie did what she liked, when she liked, and spent much time chatting with friends on the phone or planning parties. Ms Irene Brennan was in a relationship with Paul for over 20 years from about late 1997 and worked at Matra Real Estate on an ad hoc basis from time to time from about 2003 onwards. Irene gave evidence that, in her experience, Paula-Marie typically worked in the office three days per week, that she frequently called in sick or arrived late, and that she left the office early on occasions to attend to personal appointments. Paul disputes Paula-Marie’s evidence that he did no work in the Matra Real Estate business.

“34. … I was willing to work without pay because of the statements that Mum and Dad always made to me … and as a result of which I believed that I was going to end up with the business and the Property as my own.

35. I never considered working anywhere else because the Matra business was going to be mine. The only exception to this is that from time to time Dad paid me small amounts of money from Matra on an ad hoc basis. I regularly asked Dad for money because I was always short of money as I wasn’t getting paid. Dad would usually make these payments when he had sold a property and received commission. The amounts Dad paid me varied from around $100 to around $1,000. I received payments of this kind about once a year with exceptions of payments of $2,000 and $5,000 in 2015 and 2016 when I sold properties myself and Dad was overseas. …

36. I didn’t get any holiday pay, maternity leave, sick leave, long service leave, or any superannuation even though I had to do everything to run Matra on my own. Dad went overseas regularly and left me to run Matra.”

39. Andrea gave evidence that, in the years after Paula-Marie began working full-time in the business, he told her on more than one occasion that he was unhappy that she was working without being paid. On each occasion, Paula-Marie would say something like, “They are my parents and I trust them”.

40. Andrea also gave evidence that Paul said in his presence on many occasions over the years that Paula-Marie was going to be given the business and the Eastlakes property. Andrea recalled the details of one such occasion immediately after he and Paul had finished painting the Matra Real Estate Office in the early 2000s. According to Andrea’s evidence, Paul said to him in Paula-Marie’s presence: “Good job and you know it’s all going to be yours anyway”.

41. Paul gave evidence denying that he promised Paula-Marie the Eastlakes property in exchange for her work at Matra Real Estate. He acknowledged that he had discussed with Paula-Maria that, as his only daughter, she would get everything he owned when he died, including the Eastlakes property if he still owned it. Paul accepted that he may have mentioned the Eastlakes property specifically in these conversations. Over the years, he and Therese often said to Paula-Marie that she would one day inherit the business, and that she was being trained for that. Paula-Marie gave evidence in cross-examination that her parents talked about her inheriting their estates “[a]ll the time”. She maintained however, that they promised her that she would get the Eastlakes property and the Matra Real Estate business, not when they died, but when Paul retired. Paula-Marie denied that she understood that she would simply receive whatever property happened to comprise their estates when they died.

42. As I have already mentioned, Paula-Marie and Andrea married in July 2004, following which they lived at the one-bedroom property together with Therese.

43. In December 2004, Paula-Marie obtained her Real Estate Agent’s Licence.

44. According to Paul’s evidence, he and Therese had many discussions over the years about selling the Eastlakes property, but Therese did not wish to sell. In his affidavit sworn on 29 September 2023, Paul gave evidence of one conversation that he recalls having with Therese at some time after Paula-Marie and Andrea were married. According to Paul’s evidence, he told Therese that he wanted the property to be sold, but Therese told him that she wanted to continue living there with Paula-Marie and Andrea because she wanted to be living together with them when they had children so that she could be with her grandchildren and have company. Paul agreed that he could wait to get his share of the house, and that he could continue to pay the mortgage for the Eastlakes property in the meantime if Therese would pay some of the expenses, provided that the property would have to be sold when Paul needed capital for his retirement. Paul added that the business would be his, and Therese’s superannuation would be hers. According to Paul, Therese agreed that this was fair.

“There was an agreement that, when the time comes, that I finally needed to fund my retirement, the property is to be sold, or for her to look for the money to pay me off my share. In fact, I wasn’t asking for my actual share, I just said, ‘Give me at least to pay off my loan, and you can have the bloody property.’”

46. Paul gave evidence that he did not ask Therese to sell the Eastlakes property again until 2020. I refer to the evidence concerning that conversation and subsequent conversations at [81]-[84] below.

47. Therese gave evidence denying having any such conversation or making any such agreement with Paul. Therese gave evidence that she did have conversations with Paul in which they each said that Matra Real Estate would continue to pay the mortgage for the Eastlakes property and any outgoings. The business was also paying Paul’s rent before he purchased the unit in which he now lives, and later made the payments required to service the mortgage on Paul’s unit.

48. Paula-Marie gave evidence that she does not recall her parents ever informing her that they had made an agreement on the terms described in Paul’s evidence.

49. Irene gave evidence that Paul told her on many occasions that when he had separated from Therese he didn’t want to stress Paula-Marie by changing their living arrangements so he did not mind Therese and Paula-Marie continuing to live in the Eastlakes property. However, he intended to sell his share of the Eastlakes property in order to fund his retirement when the time came for him to retire.

50. Paula-Marie and Andrea had their first child on 8 August 2013 – a son named Zane.

51. Both Paula-Marie and Andrea gave evidence of Andrea complaining to Paul in 2013, shortly after the birth of their eldest child, that Paula-Marie was working too hard. According to Andrea, Paul said to him: “What are you worried about you bastard, you already have my daughter, you’re both going to get the business and the house and everything that we own, stop complaining. You should work here too.” Paula-Marie gave a similar account of the conversation. Paul gave evidence denying that any such conversation occurred.

52. Paula-Marie and Andrea had their second child on 27 November 2014 – a son named Zach.

53. Andrea’s father, Mr Riccardo Pizzimento, gave evidence of a conversation that he had with Paul in November 2017 on the occasion of Zach’s birthday party, which Riccardo and his wife hosted at their home. According to Riccardo, he and Paul were discussing the granny flat that Riccardo was then in the process of building in his backyard for his son, Fabio. Paul said to Riccardo, “What about your daughter? You’re going to have to look after her too you know”. Riccardo replied that he was looking after his daughter, and that Paul should look after his own daughter and build something for Paula-Marie and Andrea. According to Riccardo, Paul replied: “Don’t worry about Paula. She’s getting everything, the house, the guns, everything, even the Rolexes.” Each of Andrea and Paula-Marie gave evidence that Riccardo had repeated the substance of this conversation to them soon after it occurred in November 2017. Riccardo gave evidence in cross-examination that, even before November 2017, Andrea had told him that Paula-Marie was going to inherit her parents’ home. However, he denied that he understood Paul to be referring in their November 2017 conversation to Paula-Marie’s inheritance when he died.

“Not when we die, before that, because she, she had a life to live and a family to live eventually, like we didn’t know it back then, but yeah, she – the house was for her and we were probably going to move to a smaller place to live in. It was like, yeah.”

93. When it was put to Therese that she and Paul would have required funds to move to a smaller place, and that their only wealth was tied up in the Eastlakes property, Therese said that she meant that she and Paul had discussed moving into the flat at the rear of the Eastlakes property.

94. The cross-examination continued:

“Q. And what you understood Mr Penya meant when he said the words, ‘When Paula is ready she will take over the business, it’s all going to be hers one day anyway’, was that she would receive the business and perhaps the house when he died?

A. No, not when he died, no.

Q. Well you know Mr Penya quite well don’t you?

A. Well I thought I did, yeah.

Q. You know he wouldn’t give up an asset easily that he owned don’t you?

A. To his daughter, yes, I thought he loved her and she did too.

Q. Yes, but perhaps when he died but not before he died?

A. Not necessarily.

…

Q. You knew in 1995 or 1996 Mr Penya would not give up the Eastlakes house before his death, or he would not give his daughter the Eastlakes house before he died?

A. Yes he would.

Q. Well how would he do that?

A. I don’t know but I did think about, but I didn’t think he would, he would wait for her, for him to die before he’d give it to her. That wasn’t like, we used to talk about it and that wasn’t what the plan was.

Q. You used to talk about giving your estates to Paula didn’t you?

A. Yes.

Q. Any by estates it means whatever you’ve got when you die?

A. Well that’s, that’s not what I thought, that’s not what I meant.”

95. Therese gave the following evidence towards the end of her cross-examination:

“Q. You’ve got a keen interest in making sure they get the house, haven’t you?

A. Absolutely, it’s just my life. They’re my life.”

96. On 1 February 2023, Paul commenced proceeding 2023/33949 in this Court seeking an order pursuant to s 66G of the Conveyancing Act 1919 (NSW) appointing trustees for the sale of the Eastlakes property. I refer to the events that occurred immediately after the commencement of those proceedings at [134]-[147] below.

97. At the time of the hearing, Andrea was 47 years old and Paula-Marie was just a few weeks shy of her 48th birthday. Paula-Marie had lived at the Eastlakes property ever since her parents purchased it when she was 10 years old. Andrea had lived there together with Paula-Marie and Therese ever since he and Paula-Marie married in July 2004. They had continued to live there with Therese following the birth of their sons, who were aged almost ten years and eleven years at the time of the hearing. The property has one bedroom, which Therese was occupying. Paula-Marie and Andrea were sharing with their sons the dining room which had been converted into a bedroom.

98. Paul and Therese remain the registered owners of the Eastlakes property because they did not finalise their financial affairs or enter into a property settlement following the end of their marriage in 1995. At the time of the hearing, the property was subject to a mortgage securing amounts owing under three loan accounts in the joint names of Paul and Therese: (1) ANZ Home Loan account no. ending in #072 (under which approximately $174,000 was owing); (2) ANZ Home Loan account no. ending in #152 (under which approximately $80,000 was owing); and (3) ANZ Account Equity Manager account no. ending in #336 (under which approximately $170,000 was owing).

99. According to the evidence given by Therese and Paula-Marie, the first loan mentioned above (#072) secures a loan initially in the amount of $192,000 that Paul and Therese took out against the security of the Eastlakes property in about 1994. As I have already mentioned, the repayments in respect of that loan were made out of the income of the Matra Real Estate business until June 2017. Therese has made those repayments out of her Australia Post income since June 2017.

100. According to the evidence given by Paula-Marie, the second loan mentioned above (#152) secures an amount that Paul and Therese borrowed in order to assist Paula-Marie and Andrea to purchase investment properties at Hillsdale in 2007, as referred to at [106]-[112] below.

101. According to the evidence given by Paula-Marie, the third loan mentioned above (#336) secures an amount that Paul and Therese borrowed in order to assist Paula-Marie and Andrea to purchase a commercial property as an investment in 2013. I refer to this investment at [113]-[119] below.

102. Paula-Marie did not pay rent or board during the years that she lived at the Eastlakes property before her marriage. In all of the years since they began living at the property together in July 2004, Paula-Marie and Andrea have never paid rent or board. In cross-examination, Paula-Marie said: . Similarly, Andrea said: Paula-Marie and Andrea have not contributed to servicing the mortgage over the Eastlakes property, with the exception of payments of $500 per month in respect of the $80,000 loan that assisted them to purchase the Hillsdale properties in 2007 and, since 2020, payments of $1,200 per month in respect of the $170,000 loan that assisted them to purchase their commercial property in 2013. Those payments do not appear to have reduced the principal amounts owing under those loans.

“TO WHOM IT MAY CONCERN

I, Mr Paul Penya am willing to support my daughter, Mrs Paula-Marie Penya with the sum of $80,000.00 as a gift. This gift is non-repayable it is for helping her purchase two properties. One property is at 6/5 Podmore Place, Hillsdale NSW 2036 and the second is at 5/5 Podmore Place, Hillsdale NSW 2036.”

108. Paula-Marie gave evidence that Paul had subsequently insisted that she and Andrea repay the $80,000 in instalments of $500 per month. According to Paula-Marie, she and Andrea are continuing to pay those monthly instalments.

109. Therese gave evidence that she and Paul discussed borrowing $80,000 against the Eastlakes property in 2007 to assist Paula-Marie and Andrea to purchase the Hillsdale properties. Therese agreed with Paul that they should do that, and gave evidence that she “saw it as a ‘no-brainer’ to be able to use the property to help Paula acquire more property” because the Eastlakes property “was going to be Paula’s eventually”. According to Therese’s evidence, she considered that the $80,000 was a gift to Paula-Marie and Andrea. Paul initially said that Paula-Marie and Andrea would not need to pay back the $80,000, but later changed his mind. Therese did not take this up with Paul at the time because she did not want conflict with him.

110. Paul gave evidence denying that the $80,000 was a gift to Paula-Marie and Andrea, and denying the conversation referred to at [107] above. He wrote the letter “TO WHOM IT MAY CONCERN” so that Paula-Marie and Andrea could save money by avoiding paying for mortgage insurance. Paul accepted that he had lied in the letter to help Paula-Marie and Andrea to get an advantage from the bank. Paul was unrepentant about this, saying “bloody bank, they make enough money”.

111. As Paula-Marie acknowledged in cross-examination, she and Andrea could not have purchased the units at Hillsdale if they had not been living rent-free at the Eastlakes property, and without the $80,000 provided by Paul and Therese.

112. Paula-Marie and Andrea have had the benefit of the rental income received from the Hillsdale units since 2007.

113. In late 2012, Paula-Marie and Andrea purchased a commercial property at 474A Bunnerong Road, Matraville, which was located next door to Matra’s rented office. The purchase price was $572,000, including GST, and the deposit was $26,000. Therese gave them the deposit, as they did not have the funds themselves. Paula-Marie and Andrea used the services of a finance broker, Ms Yoko Chung, with whom Paul had an existing relationship. Ms Chung facilitated their application for a loan from ING Direct to finance their purchase of the commercial property. Paula-Marie signed a loan application form identifying Matra Real Estate as her employer and stating that her base income was $2,009.25 per month gross in addition to rental income of $5352.90 per month. Ms Chung, acting on behalf of Paula-Marie and Andrea, submitted that loan application, together with a letter from Matra Real Estate which stated that Paula-Marie was earning a wage of $423.076 per week and a payroll advice on letterhead of Matra Real Estate stating that she had earned $5,499.99 in the period from 1 July to 30 September 2012. Paula-Marie gave evidence in cross-examination that the information submitted to ING Direct concerning her income from Matra Real Estate was false. She accepted that the purpose of providing the letter and the payroll advice to ING Direct was to verify her earnings. However, she blamed the provision of the false information on Ms Chung and on Paul, saying that she trusted Ms Chung and left everything up to her, that Ms Chung was Paul’s broker, and that she (Paula-Marie) had acted in accordance with in signing the loan application and allowing those documents to be submitted to ING Direct. Paula-Marie went so far as to say in cross-examination that Paul her and Andrea to purchase the commercial property. When it was pointed out to her that she had not suggested in any of her affidavits that Paul forced her to purchase that property, Paula-Marie answered: . She denied that that it was a lie. When asked to identify how her father had forced her to buy the property, Paula-Marie answered that he had arranged for Ms Chung to do the paperwork, and he had told her for many years: . Paula-Marie said that Andrea had also been under Paul’s control because . Paula-Marie denied that she had simply made up in the witness box the notion that she had bought the commercial property, and the earlier investment properties, because she was under Paul’s control and following his instructions. By contrast, Andrea gave evidence in cross-examination to the effect that he and Paula-Marie accepted Paul’s advice that the commercial property would be a good investment, but that it was their own decision to purchase the property.

“I had a conversation with Dad in which I said that Andrea and I couldn’t afford to purchase this property as I was not earning any money from Matra and even though I knew I was going to get the house and the business I had no money coming in at all. Dad said ‘What are you worried about Paula? Don’t worry about the money, let the bank managers lose sleep about that, not you’. He told me that everything was going to be mine anyway and instead of paying rent I would be putting money into my property. He told me I had nothing to worry about and I was going to be *‘*a very rich little girl’ when I got everything from him and Mum.”

119. Paul gave evidence denying that this conversation occurred and denying that the $170,000 contribution to the purchase price of that property was intended as a gift to Paula-Marie and Andrea. According to Paul’s evidence, the purpose of the letter that he signed stating that it was a gift was to ensure that Paula-Marie and Andrea did not have to pay for mortgage insurance.

120. Paula-Marie gave evidence that Paul told her and Andrea that the commercial property was for sale and suggested that they buy it and move the Matra Real Estate office in there.

121. Paul gave evidence denying that there was any plan to move Matra Real Estate into the commercial property that Paula-Marie and Andrea purchased in 2013. According to Paul’s evidence, Matra Real Estate had a long-term lease over its existing premises at affordable rent.

122. According to Paul’s evidence, Paula-Marie and Andrea intended to move into their property themselves after they purchased it because it would be easier for Paula-Marie to continue working at Matra Real Estate after the birth of their first child if they were living next door. Paula-Marie mentioned a plan to move the Matra Real Estate business into the commercial part of the property in the future once she had taken over the management of the business.

123. According to Andrea’s evidence, there was discussion at the time that he and Paula-Marie purchased the commercial property about moving Matra Real Estate into the premises, and also about Andrea and Paula-Marie living in the premises. However, these were merely ideas, both of which they abandoned after further consideration.

124. Paula-Marie gave evidence that she and Andrea were unable to lease the commercial property until July 2020 because Paul stored his belongings in the property without their permission. She and Andrea therefore refused to make any repayments for the $170,000 loan that was secured against the Eastlakes property. They first began making those repayments in 2020 when the commercial property was leased. Paula-Marie exhibited to her affidavit sworn on 7 December 2023 photographs taken in 2018 and 2020 showing a desk, three chairs, two filing cabinets, two sets of shelves and some other miscellaneous items stored in one room of the commercial property.

125. Paul gave evidence that Paula-Marie and Andrea began to renovate the property shortly after they purchased it. Andrea removed partitions, the bathroom, the laundry and a large part of the ceiling and flooring, cut off the connections to the water supply, removed the hot water system, and cut off electricity connections. According to Paul’s evidence, he declined Andrea’s requests to give him money to repair the property, and Andrea did not fix it up and reinstate the connections to water and electricity for several years. Paul deposed that the property remained vacant for that reason. He gave evidence denying that he prevented the property from being rented by storing his belongings in there.

“111. I cannot move into any of my investment properties because I need the rental income to help cover my mortgage repayments. With all the recent interest rate rises, it has become much harder to make the payments.

112. I also never had any opportunity to contribute to my superannuation. So I am treating the commercial property as my retirement plan. This investment will help fund my retirement.

113. If we are made to move from the Property, we could not afford to buy or rent in the area because we are on just Andrea’s income. Because of this, I’ll have to remove my children from their school where they have made friends, remove them from their local soccer team which my husband coaches and move away from my in-laws who live near us.”

130. In her affidavit sworn on 7 December 2023, Paula-Marie deposed that she and Andrea do not wish to sell their investment properties because, if they did, they would receive net proceeds of approximately $832,000 after discharging the loans secured against the properties, paying the costs of sale, and paying capital gains tax. Paula-Marie deposed that this would not put them in a position to purchase a house in the current market, and they would be unable to borrow additional funds because she had no income and Andrea was earning $25,000 per annum before tax.

131. In her affidavit sworn on 4 October 2023, Paula-Marie acknowledged that she had incorrectly calculated the net sale proceeds that she and Andrea would receive if they sold their investment properties. Paula-Marie re-calculated the net sale proceeds as $2,096,000.

132. In her affidavit sworn on 9 August 2023, Paula-Marie deposed:

“I always relied on the promises from Dad and Mum that the business and house were going to be mine. If this was not stated to me I would have worked somewhere else to receive a wage. I also would have purchased my own home with my husband, rather than buying investment properties.”

133. Paula-Marie also deposed that the only thing that kept her working at Matra Real Estate while she was feeling “undervalued”, “used” and “unappreciated” by Paul was:

“… my expectation that as a result of the work I was doing I would end up owning a home for my children to live in and a business to give us income. This was my sacrifice.”

134. Paula-Marie adhered to that evidence in cross-examination, denying that it suited her to work at Matra Real Estate because it was an easy existence for her.

135. As I have already mentioned, Paul commenced proceedings in this Court on 1 February 2023 seeking an order pursuant to s 66G of the Conveyancing Act 1919 (NSW) appointing trustees for the sale of the Eastlakes property.

136. Therese was the sole defendant to those proceedings.

137. In her affidavit sworn on 7 December 2023, Paula-Marie gave evidence that she first became aware that Paul wanted to sell the Eastlakes property when Therese was served with the summons in early February 2023. Paula-Marie gave evidence in cross-examination that Paul told her that he would not require the property to be sold if she and Therese could pay him money. Paula-Marie and Andrea applied for a loan. Paula-Marie gave evidence that she could not remember how much they applied to borrow, but said that she wanted to see how much they would be able to borrow to pay Paul out.

138. On 12 February 2023, Therese wrote to Paul’s solicitor, Mr Robert Eaves of Eaves Legal, in the following terms:

“This letter is requesting if you could please consider postponing the Supreme Court hearing for this matter.

The reason I am requesting this is to give our daughter, Paula-Marie Penya time to arrange finance.

Our daughter will confirm with you and her father the loan approval amount from the bank as soon as she receives the confirmation in writing.

If you and Mr Penya agree could you please confirm this in writing by replying back to my daughter’s email address …”

139. In cross-examination, Therese had no independent recollection of writing this letter or the circumstances existing at that time. However, she accepted that she did write it, and that it bears her signature, and said that Paula-Marie would have been seeking a loan to buy-out Paul’s interest in the Eastlakes property only. Paula-Marie would not have needed to buy out Therese’s interest because “she knows that I would have given her everything that was mine”. Therese gave evidence that family is everything to her, and that she would do everything she possibly could to help Paula-Marie, Andrea and her grandchildren.

140. Paula-Marie’s loan application was not successful because she was earning no income and Andrea was not earning sufficient income to service the proposed loan.

141. Therese sought advice from Mr Robert Micallef, the principal of Robert Allan Property, about the marketing strategy and likely sale price for the Eastlakes property. Mr Micallef provided written advice to Therese on 22 March 2023. On the same day, Therese’s solicitor Ms Brooke Azar of VRT Legal wrote to Paul’s solicitor Mr Eaves enclosing proposed consent orders for the dismissal of the s 66G proceedings on terms that the Court noted the parties’ agreement: (1) to take all necessary steps to sell the Eastlakes property as soon as practicable, including appointing Mr Eaves to prepare a contract for sale, appointing Mr Micallef as the sales agent, and selling the property by public auction with a reserve price agreed between Paul and Therese or determined by Mr Micallef if they were unable to agree; and (2) to apply the sale proceeds by discharging the mortgage, paying the agent’s commission and advertising costs and other expenses, paying the legal costs relating to the sale, and paying the balance equally between Paul and Therese.

142. In his affidavit sworn on 29 September 2023, Paul deposed that he discussed the proposed orders with Therese, and that they both agreed to the sale of the Eastlakes property and the terms of the orders. However, at the directions hearing at which Paul had expected the orders to be made by consent, Therese’s solicitor informed Paul’s solicitor that solicitors representing Paula-Marie would be appearing to request that Paula-Marie be joined to the proceedings and that Paula-Marie intended to commence her own proceedings. Therese’s solicitor told Paul’s solicitor that Therese would therefore wait and see if the Court allowed Paula-Marie’s applications. According to Paul’s understanding, the Court gave leave for Paula-Marie to commence her proceedings, and the consent orders that he and Therese had agreed to were therefore not made.

143. Therese subsequently sent a text message to Paul in early April 2023 accusing him of “hurting Paula & your grandsons for the rest of their lives!!” by prosecuting his application for sale of the Eastlakes property pursuant to s 66G, imploring him to “do the right thing” by her and by Paula-Marie and her family by discontinuing the proceedings. Therese wrote to Paul that he should Therese continued: Therese wrote to Paul that Paula-Marie and her family would otherwise

“Well when I die, because of what happened and because of the fact that she’s been helping me all this time, I told her I, I want, I want her to inherit the unit which originally I wanted to give my daughter, but because of what has happened I, I just got sick of it. It was all take, take, take. When they need money, when I had money they could get it, but when I was out, no money, now I was the bad one. I made them millionaires, they were useless.”

147. Irene gave evidence that she was aware that Paul may leave her something in his will, but she considers his will to be his own business, she prefers not to know about it, she is more than capable of providing for herself, and she does not want the tension and friction that she believes will flow to her from Paul’s family if he leaves her part of his estate. Irene said:

“I just want to live peaceful life so nobody bothers me, okay, because Andrea already threatened him few times. I don’t want any frictions and I told Paul I – you know how they show in the movies. You show them the money, everybody starts fighting. We see it on the news all the time. I don’t want it for myself. I’m fine.”

Paula-Marie’s proprietary estoppel claim

148. Paula-Marie’s pleaded case is that Paul and Therese represented to her repeatedly during the period from about 1996 to 2022 that, if she worked full-time in the Matra Real Estate business without pay, then “she would be given the home and the business*”*.

149. The alleged representations are particularised in the following terms in paragraph 8 the amended statement of claim that Paula-Marie was granted leave to file in the trust pleadings on the first day of the hearing:

“(a) The representations were made orally and by conduct.

(b) In about 1996, the daughter had a conversation with her father in which he requested that she work full time in the business without being paid on the basis that he and the mother would give the daughter ‘everything’ including the home and the business.

(c) A short time after the daughter started working full time in the business, she had a conversation with the mother and father in which:

(i) she complained about not being paid for her work;

(ii) the father assured her that she was going to end up with the home and business; and

(iii) the mother confirmed that assurance.

(d) In about 2012, around the time when the daughter and her husband purchased a commercial property adjacent to the premises of the business, she had a conversation with her father in which:

(i) she expressed concern about not being able to afford the purchase in circumstances where she had no income of her own;

(ii) she acknowledged that she knew that she was going to get the home and the business and would move the business to this commercial property;

(iii) the father assured her that she had nothing to worry about on the basis that ‘everything’ was going to be hers.

(e) In about 2021, the father showed and gave the daughter a copy of his will, confirming that everything that he owned was being passed down to her.

(f) In about 2022:

(i) the daughter had a conversation with the mother in which the mother expressed a desire to fix up the home to be more comfortable for the daughter, the husband and their children to live in and then move out on the basis that the home was the daughter’s;

(ii) at around the same time, the daughter had a conversation with her father in which he told her:

(1) that the mother wanted the home to be put in the mother’s name so that she could access her superannuation to fix up the house for the daughter, the husband and their children;

(2) that he was not comfortable transferring his share to the mother’s name only; but

(3) that he fixed up the ownership so that there would be no question that he would give everything to the daughter.

(g) Neither the mother nor the father ever resiled from the representations that the daughter would be given the home and the business at any time while the daughter was working full time at the business without pay despite knowing that the daughter was doing so based on the representations.”

150. Paula-Marie pleads that, since about 1996, she has assumed that “she would be given the home and the business”, and that her parents’ conduct as described in the particulars set out above materially contributed to her making that assumption.

151. Paula-Marie’s pleading does not identify the time at which she claims it was represented to her, and she assumed, that she would be given the Eastlakes property and the Matra Real Estate business. In opening the case on the first day of the hearing, counsel for Paula-Marie submitted that the alleged representations were not promises that Paula-Marie would inherit the property and the business, or her parents assets, after they died. It was submitted that “while the specific ‘when’ was often a bit vague in the conversations it was present as something that would happen within the parents’ lifetime. For example, there were many references in the evidence to Paula-Marie being the successor to the business, taking over after Paul retired, clearly being a lifetime thing …” The submission did not elaborate on how the alleged representations should be understood in terms of the time at which the Eastlakes property would be “given” to Paula-Marie.

152. Paula-Marie pleads that she has changed her position in reliance on the assumption since 1996 by: (1) working in the Matra Real Estate business on a full-time basis five days per week plus regular overtime in the evenings and on weekends, and managing the business, without receiving any wage or salary or paid leave; (2) undertaking a Real Property Management course shortly after she started working in the business; (3) completing her Diploma of Business in Real Estate Management in about 1998; and (4) obtaining her Real Estate Agent’s licence in December 2004. Paula-Marie pleads that she would therefore suffer detriment if her parents were permitted to depart from her alleged assumption, and that it would be unconscionable for them to do so.

153. Paula-Marie pleads that Paul departed from the assumption by selling the rent roll for the Matra Real Estate business and by now prosecuting the s 66G proceedings with the object of selling the Eastlakes property.

154. Paula-Marie pleads that Paul and Therese are “estopped from denying that [Paula-Marie] would be given the home and the business” and that they therefore hold their interests in the Eastlakes property on constructive trust for her and Paul is liable to account to her for the proceeds of the sale of the rent roll.

155. Paula-Marie relies on the doctrine of proprietary estoppel by encouragement.

156. In order to succeed in that claim, Paula-Marie must establish: [3]

157. a clear and unequivocal promise made to her by Paul and Therese that, if she worked full-time in the Matra Real Estate business without pay, then they would give her the business and the Eastlakes property during their lifetime;

“… human memory of what was said in a conversation is fallible for a variety of reasons, and ordinarily the degree of fallibility increases with the passage of time, particularly where disputes or litigation intervene, and the processes of memory are overlaid, often subconsciously, by perceptions or self-interest as well as conscious consideration of what should have been said or could have been said. All too often what is actually remembered is little more than an impression from which plausible details are then, again often subconsciously, constructed. All this is a matter of ordinary human experience.”

163. For that reason, when assessing the evidence of a witness about their memory of historic conversations, the Court places primary emphasis on any objective surrounding facts that are either undisputed or established by contemporaneous documents, and the inherent probabilities and improbabilities, [5] accepting, however, that witness testimony may still be of value and importance, including by providing evidence of the context in which relevant documents and events must be understood. [6]

164. I reject the submission made on behalf of Paula-Marie that those principles do not apply to the evidence of the alleged representations in the present case because they are said to have been repeated many times over the years. That submission erroneously assumes the accuracy of each claimed recollection of oral representations said to have been made at different times many years ago.

165. I also reject the submission made on behalf of Paula-Marie that there is little or no scope for those principles to apply to Paula-Marie’s evidence because it is corroborated by evidence given by Therese, contrary to her own interests. As explained below, Therese’s affidavit evidence does not corroborate Paula-Marie’s evidence that she was promised that if she worked in the business without a wage then she would be given the Eastlakes property and the business during Paul’s and Therese’s lifetime. For the reasons explained below, I do not regard as credible Therese’s evidence in cross-examination that Paula-Marie was promised both the Eastlakes property and the business when Paul retired. It is certainly not contrary to Therese’s perception of her own interests, which are very clearly aligned with Paula-Marie’s interests, as Therese acknowledged in cross-examination.

166. Paula-Marie’s evidence that Paul asked her to work at Matra Real Estate because it was costing him too much money to pay his existing staff a wage is inherently probable having regard to the undisputed evidence about the poor financial state of the business. [7] I therefore accept that aspect of Paula-Marie’s evidence, and reject Paul’s evidence that Therese sacked his existing staff while he was on holiday, and announced that Paula-Marie was to work in the business, without his consent.

167. However, I do not feel actual persuasion [8] that the March 1996 conversation and/or the 1997 conversation contained a clear and unequivocal promise by Paul and/or Therese that, if Paula-Marie worked full-time in the business without pay, then they would give her the business and the Eastlakes property during their lifetime.

168. Paula-Marie’s account of her March 1996 conversation with Paul is internally inconsistent.

169. On the one hand, Paula-Marie says that Paul told her that everything was going to be hers “anyway” and that he and Therese were going to because she was their only child. [9] I accept that aspect of Paula-Marie’s account of the March 1996 conversation, which is plainly referring to a future inheritance, and which is consistent with the evidence given by Paul and Therese, and also by Paula-Marie, that they frequently discussed the fact that their entire estates would go to her as their only child after they died. [10] It is also broadly consistent with the conversation that Therese says she had with Paula-Marie after her conversation with Paul, in which Therese confirmed that Paula-Marie would and that it would all be hers. [11] I accept that Paul and Therese did intend for Paula-Marie to inherit the whole of their estates on their death.

Paula-Marie’s common intention constructive trust claim

197. Paula-Marie pleads that it should inferred from the alleged representations referred to at [149] above and from Paula-Marie’s conduct referred to at [152] above that it was agreed or it was the common intention of Paul, Therese and Paula-Marie during the period from about 1996 to 2022 that, if Paula-Marie worked full time in the Matra Real Estate business without being paid, “then she would be given the home and the business”.

198. Paula-Marie pleads that, by taking the actions referred to at [152] above, she acted to her detriment on the basis of that agreement or common intention.

199. Paula-Marie claims that it follows that Paul and Therese hold their interests in the Eastlakes property on constructive trust for her, and that Paul is liable to account to her for the proceeds of sale of the rent roll.

200. For all of the reasons explained at [157]-[194] above, Paula-Marie has failed to establish the alleged representations from which she contends that the alleged common intention or agreement should be inferred. Without those alleged representations being established, Paula-Marie’s conduct referred to at [152] above does not support the alleged agreement or common intention. Paula-Marie’s common intention constructive trust claim fails for those reasons. Even if the alleged common intention or agreement had been established, I would not have been satisfied that Paula-Marie had acted to her detriment on the basis of that intention or agreement for the reasons explained at [193]-[194] above.

201. In the circumstances, it is not necessary for me to consider whether there is available under Australian law a common intention constructive trust which may be found in circumstances where proprietary estoppel has been rejected. [45]

Paula-Marie’s claim for a constructive trust following the failure of an alleged joint endeavour

202. Paula-Marie’s alternative claim for relief based on what her pleading described as a “joint endeavour constructive trust” required her to demonstrate: [46]

203. the formation of a joint endeavour;

204. the acquisition of property pursuant to that joint endeavour; and

205. premature termination of the joint endeavour, without fault of any party, leaving one party with a legal interest which that party was not intended to enjoy beneficially in the circumstances. Equity will not permit that party to assert or retain the benefit of the relevant property to the extent that it would be unconscionable for them to do so.

206. It is necessary to identify the nature, scope and purpose of the alleged understanding between the parties that is said to constitute the joint endeavour, although the scope of that understanding may change from time to time. [47]

207. Paula-Marie pleads that it should inferred from the alleged representations referred to at [149] above and from Paula-Marie’s conduct referred to at [152] above that there was “a joint endeavour” between Paul, Therese and Paula-Marie during the period from about 1996 to 2022 “to enhance the material wellbeing of their family through the home and the business”.

208. Paula-Marie claims to have made contributions to that joint endeavour by her actions referred to at [152] above and by “contributing domestically over a substantial period of time”. Paula-Marie pleads that her contributions in the form of unpaid labour for the business and domestically increased the money available to maintain the home.

209. Paula-Marie pleads that it follows that Paul and Therese hold their interests in the Eastlakes property on constructive trust for her, and that Paul is liable to account to her for the proceeds of sale of the rent roll.

210. This claim was not addressed in Paula-Marie’s written submissions, save for a statement that the Court should find, based on the whole of the evidence, that “the contributions between Paula-Marie, Paul and Therese were all designed to enhance the material well-being of their family through the Property and the Business”.

211. Counsel for Paula-Marie did not address the claim in closing submissions at all, until I asked the question of what was meant by the pleading that there was “a joint endeavour … to enhance the material wellbeing of their family through the home and the business”. Counsel for Paula-Marie then submitted that the claim meant that the “whole endeavour was Paula working in the business, whereby the fruits of that labour would be applied to pay off the loan on the property” and that Paul and Therese would receive a unless the Court declares that they hold the Eastlakes property on constructive trust for Paula-Marie.

Paul’s section 66G claim

214. Section 66G of the Conveyancing Act confers a discretion on the Court to make an order appointing trustees for sale. It is well established that the grounds on which the Court will ordinarily decline to make such an order are limited. Those grounds include where the order would be inconsistent with a proprietary right, or a contractual or fiduciary obligation or an equitable or conventional estoppel against the application. There is no general jurisdiction to refuse to grant an order under s 66G on the basis of alleged hardship or unfairness. [49]

215. It is for a co-owner who opposes the making of an order under s 66G to establish a reason why the order should not be made. [50]

216. Neither Paula-Marie nor Therese raised any opposition to the orders sought by Paul under s 66G save for Paula-Marie’s claim that the Eastlakes property is held on constructive trust for her. Nor did they wish to be heard in relation to the identity of the trustees for sale. Paul’s proposed trustees – Mr John Lloyd, solicitor, and Mr Geoff Gilles, real estate agent – have each sworn affidavits consenting to be appointed as trustees.

217. As Paula-Marie’s claim has failed, orders should be made substantially in the terms sought by Paul in his summons filed in the s 66G proceedings. The summons did not specifically address how the sale proceeds are to be applied, but neither Paul nor Therese suggested that the loans secured by the mortgage registered against the title to the Eastlakes property should not be paid out of the sale proceeds to discharge the mortgage on settlement. Nor was there any suggestion that the balance of the sale proceeds should not be divided between Paul and Therese equally after payment of the trustees’ costs incurred in selling the property (including any legal costs), and the trustees’ reasonable remuneration. For abundant caution, I will make an order requiring Therese and Paula-Marie to vacate the Eastlakes property seven days prior to the completion of any contract for the sale of the property entered into by the trustees. Neither Paul nor Therese sought an order under s 66I of the Conveyancing Act and I will reserve liberty for them to do so within 14 days out of abundant caution. I will also grant liberty to the trustees to apply for any order or direction for the purpose of the discharge of their duties under the statutory trust for sale, and for approval of their remuneration in the event that it is not agreed by Paul and Therese as the co-owners of the property.

Orders

218. For all of the foregoing reasons, the orders of the Court in proceeding no. 2023/143366 (the trust proceedings) are:

219. Proceedings dismissed, save in relation to the question of costs which is reserved for further consideration and determination on the papers.

220. Direct the parties to bring in short minutes of order within 14 days in relation to the costs of these proceedings.

221. In the event that the parties are unable to reach agreement in relation to the costs of the proceedings, direct that the short minutes in order (2) are to be in the form of a joint document identifying the position of each party, accompanied by a written submission of each party in support of their position being no more than three pages length.

222. For all of the foregoing reasons, the orders of the Court in proceeding no. 2023/33949 (the s 66G proceedings) are:

223. Order pursuant to s 66G of the Conveyancing Act 1919 (NSW) that the whole of the land at 11 Robinson Street, Eastlakes, New South Wales, being lots 28 and 30 in Deposited Plan DPXXXX (the Property) be vested in Mr John Lloyd, solicitor, and Mr Geoff Gilles, real estate agent (the Trustees), subject to encumbrances affecting the entirety, on the statutory trust for sale as defined in s 66F(2)(a) of that Act.

224. Order that the defendants provide to the Trustees vacant possession of the property no later than seven days prior to the date for completion of any contract for sale of the Property entered into by the Trustees.

225. Order that, upon the sale of the Property, the sale proceeds be applied as follows:

(a) first, in discharging the mortgage registered on the title to the Property; (b) second, in payment of the costs reasonably and properly incurred by the Trustees in selling the Property; (c) third, in payment of the Trustees’ reasonable remuneration in an amount agreed by the plaintiff and the first defendant in writing or, in the absence of agreement, in an amount approved by the Court; and (d) fourth, by paying the balance to the plaintiff and the first defendant in equal shares.

4. Grant liberty to the plaintiff and the first defendant to apply for any order pursuant to s 66I of the Conveyancing Act 1919 (NSW) by notice of motion filed within 14 days of the date of these orders.
5. Grant liberty to the Trustees to apply on no less than three days’ notice to the parties for:

(a) any order or direction in connection with the discharge of their duties under the statutory trust for sale; and/or, (b) an order approving their remuneration in the event that it is not agreed by the plaintiff and the first defendant.

6. Costs reserved for further consideration and determination on the papers.
7. Direct the parties to bring in short minutes of order within 14 days in relation to the costs of these proceedings.
8. In the event that the parties are unable to reach agreement in relation to the costs of the proceedings, direct that the short minutes in order (7) above are to be in the form of a joint document identifying the position of each party, accompanied by a written submission of each party in support of their position being no more than three pages length.

**********

Endnotes

See [41] above.

See [17], [23], [27]-[29], [64] and [73] above.

Kramer v Stone (2024) 421 ALR 106; [2024] HCA 48 at [36]-[41] (Gageler CJ, Gordon, Edelman and Beech-Jones JJ).

(1995) 49 NSWLR 315 at 319.

Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 at [28]-[31] (Gleeson CJ, Gummow and Kirby JJ); Moubarak by his tutor Coorey v Holt (2019) 100 NSWLR 218; [2019] NSWCA 102 at [77] (Bell P, as the Chief Justice then was, Leeming JA and Emmett AJA agreeing).

ET-China.com International Holdings Ltd v Cheung (2021) 388 ALR 128; [2021] NSWCA 24 at [25]-[29] (Bell P, as the Chief Justice then was, Bathurst CJ agreeing).

See [55]-[57] above.

Evidence Act 1995 (NSW), s 140; Warner v Hung; In the matter of Bellpac Pty Ltd (receivers and managers appointed) (in liquidation) (No. 2) (2011) 197 ALR 56; [2011] FCA 1123 at [48] (Emmett J); John Holland Pty Ltd v Kellogg Brown & Root Pty Ltd [2015] NSWSC 451 at [94] (Hammerschlag J, as his Honour then was); Singh v AKM Investments Group Pty Ltd [2024] NSWCA 268 at [45]-[47] (Gleeson JA, Bell CJ and Stern JA agreeing).

See [21] above.

See [17] and [41] above.

See [23] above.

See [21] above.

See [133] above.

See [27] above.

See [24] above.

See [29] above.

See [17] above.

See [41] above. When Therese was called to give evidence on the second day of the hearing, I observed that she had been sitting in court throughout the first day of the hearing, including while Paula-Marie was cross-examined.

See [91]-[95] above.

See [143] above.

See [103] above.

See [116] above.

See [85] above.

See [54]-[59] and [97]-[131] above.

See [49]and [147] above.

See [41] above.

See [60] above.

See [84] above.

See [138]-[139] above.

See [143] above.

See [41] above; Zugic v Vesuvius Australia Pty Ltd [2020] NSWSC 106 at [272]-[275] (Ward CJ in Eq, as her Honour then was), discussing the requirement that a representation relied on as founding an equitable estoppel be clear and unequivocal.

See [74]-[77] above.

See [113] above.

See [78]-[79] above.

See [137]-[140] above.

See [144]-[145] above.

See [156] above.

See [38] and [132]-[134] above.

See [32]-[35] and [55]-[57] above.

See [55]-[58] above.

See [37] above.

See [97]-[131] above.

Kramer v Stone [2024] HCA 48 at [40] (Gageler CJ, Gordon, Edelman and Beech-Jones JJ).

See [132] above.

Galati v Deans [2023] NSWCA 13 at [57]-[61] (White JA) and [148]-[149] (Basten AJA, Macfarlan JA agreeing), and the authorities there referred to.

Muschinski v Dodds (1985) 160 CLR 583; [1985] HCA 78 at 620 (Deane J); Baumgartner v Baumgartner (1987) 164 CLR 137; [1987] HCA 59 at 148 (Mason CJ, Wilson and Deane JJ); McKinlay v Woods [2024] NSWCA 122 at [80]-[85] (Leeming JA, White JA and Griffiths JA agreeing).

Zhang v Metcalf [2020] NSWCA 228 at [57] (Gleeson JA, Payne and White JJA agreeing); McKinlay v Woods [2024] NSWCA 122 at [89] (Leeming JA, White JA and Griffiths JA agreeing); Hellenic Property Holdings Pty Ltd v Makaritis [2025] NSWCA 13 at [81] (Mitchelmore JA, Basten and Griffiths AJJA agreeing).

See [193] above.

Williams v Legg (1993) 29 NSWLR 687 at 691-693 (Handley, Sheller and Cripps JJA); Hogan v Baseden (1997) 8 BPR 15,723 at 15,723 (Mason P) and 15,726 (Beazley P, as Her Excellency then was, Stein JA agreeing); Ferella v Official Trustee in Bankruptcy [2015] NSWCA 411 at [36]-[43] (Tobias AJA, Bergin CJ in Eq agreeing) and [71] (Emmett AJA) (Ferella); Foundas v Arambatzis [2020] NSWCA 47 at [62]-[63] (White JA, Bell P, as the Chief Justice then was, and Basten JA agreeing).

Woodson (Sales) Pty Ltd v Woodson (Australia) Pty Ltd (1996) 7 BPR 14,685 at 14,701 (Santow J, as his Honour then was); Vacation Club Ltd v A GG Properties Pty Ltd (2019) 19 BPR 39,799; [2019] NSWSC 1357 at [33] (Darke J). See also Pascoe v Dyason [2011] NSWSC 1217 at [7] (Black J), which was cited with approval in Ferella at [36].

Amendments

23 July 2025

Typographical error

23 July 2025

Typographical error