Perry v Perry - [2021] NSWSC 1669 - NSWSC 2018 case summary — Zoe

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Perry v Perry

[2021] NSWSC 1669

Supreme Court of NSW|2018-10-18|Before: Robb J

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At a glance

Source facts

Court

Supreme Court of NSW

Decision date

2018-10-18

Before

Robb J

Catchwords

29 ER 610 Barlow v Grant (1684) 1 Vern 255
[1992] HCA 15 Evans v Braddock [2015] NSWSC 249 Ex parte Chambers, in the Matter of Chambers (1829) 1 Russ & M 577
39 ER 221 Ex parte Green (1820) 1 Jac & W 253
37 ER 372 Flourentzou v Spink [2019] NSWCA 315 Fountain v Alexander (1982) 150 CLR 615

Source

Original judgment source is linked above.

Catchwords

29 ER 610 Barlow v Grant (1684) 1 Vern 255[1992] HCA 15 Evans v Braddock [2015] NSWSC 249 Ex parte Chambers, in the Matter of Chambers (1829) 1 Russ & M 57739 ER 221 Ex parte Green (1820) 1 Jac & W 25337 ER 372 Flourentzou v Spink [2019] NSWCA 315 Fountain v Alexander (1982) 150 CLR 61533 ER 612 McEvoy v McEvoy (No 2) [2013] NSWSC 1162 Meshumar v Otmy (2018) 97 NSWLR 615[2018] NSWSC 125 Muschinski v Dodds (1985) 160 CLR 583(2013) 93 ACSR 606 Re WalderTownsend v Walder (1903) 3 SR (NSW) 37520 WN (NSW) 144 Reeves v Brymer (1801) 6 Ves Jun 51631 ER 1172 Robison v Killey (1862) 30 Beav 52054 ER 991 Sherwood v Smith (1801) 6 Ves Jun 45431 ER 1141 Singh v Singh [2017] NSWCA 234 Sisson v Shaw (1804) 9 Ves Jun 285

Judgment (40 paragraphs)

[1]

1 Ex parte Green (1820) 1 Jac & W 253; 37 ER 372 Flourentzou v Spink [2019] NSWCA 315 Fountain v Alexander (1982) 150 CLR 615; [1982] HCA 16 Gillick v West Norfolk and Wisbech Area Health Authority [1986] AC 112 Hewer v Bryant [1970] 1 QB 357 Hons v Hons [2010] NSWSC 247 Hoste v Pratt [1798] 3 Ves Jun 730; 30 ER 1243 In re Cahill's Estate (1886) 12 VLR 228 In re Howarth (1873) LR 8 Ch App 415 In re Richards (1931) 31 SR (NSW) 565 In the Estate of Dwyer (decd) (1886) 12 VLR 303 Kerferd v Perpetual Executors and Trustees Association of Australasia Ltd (1893) 19 VLR 700 Maberly v Turton (1808) 14 Ves Jun 499; 33 ER 612 McEvoy v McEvoy (No 2) [2013] NSWSC 1162 Meshumar v Otmy (2018) 97 NSWLR 615; [2018] NSWSC 125 Muschinski v Dodds (1985) 160 CLR 583; [1985] HCA 78 Neale v Bank of Western Australia [2014] NSWSC 315 Pavlis v Pavlis [2021] NSWSC 1117 Re Application of a Local Health District; Patient Fay [2016] NSWSC 624 Re Moylan (1881) 5 AJR 67 Re Neeson (1869) 6 WW. & aB. Eq. 319 Re Pleash (as joint and several liquidators of Suncoast Restoration Pty Ltd (in liq) [2013] FCA 355; (2013) 93 ACSR 606 Re Walder; Townsend v Walder (1903) 3 SR (NSW) 375; 20 WN (NSW) 144 Reeves v Brymer (1801) 6 Ves Jun 516; 31 ER 1172 Robison v Killey (1862) 30 Beav 520; 54 ER 991 Sherwood v Smith (1801) 6 Ves Jun 454; 31 ER 1141 Singh v Singh [2017] NSWCA 234 Sisson v Shaw (1804) 9 Ves Jun 285; 32 ER 612 Spink v Flourentzou [2019] NSWSC 256 Warner v Hung, in the matter of Bellpac Pty Ltd (recs and mgrs apptd) (in liq) (No 2) [2011] FCA 1123; (2011) 297 ALR 56 Watson v Foxman (1995) 49 NSWLR 315 Texts Cited: G E Dal Pont and K Mackie, Law of Succession (2nd ed, 2017, LexisNexis Butterworths) J D Heydon and M J Leeming, Jacobs' Law of Trusts in Australia (8th ed, LexisNexis Butterworths) Category: Principal judgment Parties: Tanya Lynette Perry (plaintiff) Anne Lynette Perry (first defendant) Mark William Perry (second defendant) Michelle Perry (third defendant) Louise Anne Perry (fourth defendant) Representation: Counsel: J Needham SC/ M M Pringle (plaintiff) J Gooley/ R M Higgins (first to fourth defendants)

[3]

Judgment

Russell William Perry died in January 1975, at the age of 24, as a result of accidentally drowning in a river.
The family that Russell left behind at the time of his death are parties to these proceedings. Without meaning any disrespect, as all of the parties have the same family name, I will refer to the parties by their first names.
The plaintiff, Tanya, was born in May 1970. The first defendant, Anne, is Russell's widow, and the mother of Tanya, the second defendant, Mark, and the fourth defendant, Louise. Anne did not remarry. Mark was born in July 1972, and Louise was born in June 1974. Each of the children was therefore very young at the time of Russell's death. The third defendant, Michelle, is the wife of Mark.
Russell died intestate. On 23 September 1975, this Court made a grant of letters of administration to Anne.
By application of ss 49 and 50 of the Probate and Administration Act 1898 (NSW), as amended by the Administration of Estates Act 1954 (NSW), the members of Russell's family were entitled to share in his estate in the following proportions: Anne as to one third and the children in equal shares as to the remaining two thirds. The children were therefore each entitled to two ninths of the estate.
Anne has not yet completed the administration of Russell's estate. That is so even though the youngest child, Louise, reached her majority on 14 June 1992. As will be seen below, the assets in Russell's estate have been used for various family purposes.
Following Russell's death, Anne was faced with the need to fend for herself and to bring up her three children. The primary asset in Russell's estate was a half interest with Russell's brother, Ray, in a farming property at Fernmount, near Bellingen, in the north of New South Wales. The parties called this property the Fernmount land.
At the time of Russell's death, there was a dwelling house on the Fernmount land. The dwelling house burnt down, and Anne received half of the proceeds of the fire insurance policy. That money formed part of Russell's estate. Anne used the money, together with a small additional sum that was borrowed, to buy Ray's half share in the Fernmount land.
Thereafter, at various times, a new dwelling house and a cottage were constructed on the Fernmount land. A large shed was relocated to the Fernmount land, a piggery was established by Anne on the Fernmount land, and Mark and Michelle agisted their dairy cattle on the Fernmount land, in return for which they carried out improvements and took care of the land. Anne lived in the dwelling house on the land as her home until recently. Mark and Michelle dwelt in the cottage for a number of years. Tanya and Louise even obtained a development approval from the local council for the construction and operation of an eco-tourism lodge on the Fernmount land.
The family has now been engulfed by the dispute that has led to the present proceedings.
Tanya lodged a caveat against the title to the Fernmount land to protect her interest in Russell's estate, insofar as that interest consisted of a beneficial interest in the Fernmount land.

[4]

History of the proceedings

These proceedings were commenced by statement of claim filed by Tanya on 10 November 2016.
The proceedings were set down for hearing before me for a period of seven days commencing on 15 October 2018.
On 18 October 2018, the fourth day of the hearing, Tanya sought leave to further amend her statement of claim. I made case management orders that required Tanya to serve a draft pleading on the defendants and vacated the balance of the hearing. Tanya filed her further amended statement of claim (FASOC) on 8 April 2019. The defendants filed their further amended defence (FAD) in response on 1 May 2019. A reply was filed by Tanya on 27 May 2019. Those were the pleadings upon the basis of which these proceedings were finally conducted. The proceedings have been conducted by the parties closely by reference to the pleadings. It will be necessary to analyse the pleadings below.
The Court was able to list the balance of the hearing on 1 July 2019, and it was concluded after a further five days.
Tanya delivered comprehensive written submissions on 30 August 2019 (PS) and the defendants responded on 5 November 2019 (DS).
The parties sought and were given an opportunity to make oral submissions to the Court. That occurred on 17 April 2020.
In addition, a number of directions hearings were necessary in order for the Court to make orders to govern the sale of the Fernmount land. That came about because of a decision by Anne to sell the Fernmount land in any event. In circumstances that I will explain more fully below, the manner in which the Fernmount land was put to the market, and the price gained for it, have a material bearing on the resolution of one of the significant issues in this case.
There was a dispute between the parties as to whether the fact that the development approval granted by the local council was permanently attached to the Fernmount land added to its market value, and if so by how much. The orders that the Court made to govern the manner of sale of the Fernmount land were in part designed to facilitate the possibility that the existence of the development approval would improve the sale price, and also the prospect that the sale process would itself generate evidence that would assist in resolving the uncertainty about whether the existence of the development approval added value to the Fernmount land.
Consequently, while these reasons for judgment were in the course of preparation, I caused my Associate to send an email to the parties' legal representatives to enquire whether anything had occurred during the process of putting the Fernmount land to market that was relevant to the resolution of the dispute between the parties and which they wished the Court to take into account in determining the proceedings. I will deal with this issue below when I consider what Tanya pleaded as her joint venture claim in relation to the alleged improvement to the value of the Fernmount land by reason of the existence of the development approval.
Another significant event during the course of preparation of these reasons was that, on 18 September 2020, Tanya filed a notice of motion in which she sought a grant of leave to reopen her case for the purpose of adducing further affidavit evidence on an issue relevant to the determination of the assets that were included in Russell's estate. That issue was whether money received by Anne from the sale of a property called Pony Paddocks owned by Russell's mother, Ellen, was received in her personal capacity, or whether it was part of Russell's estate, and so partly held on trust for Tanya. The additional evidence was contained in an affidavit sworn on 17 September 2020 by Vicki Perry, the wife of Russell's brother Ray.
On 16 October 2020, the Court made orders by consent giving Tanya leave to reopen her case and for the defendants to serve evidence in reply. The defendants served a further affidavit of Anne sworn on 27 October 2020.
The defendants' solicitor advised my Associate by email dated 9 November 2020 that the Fernmount land was proposed to be sold by auction on 28 November 2020, with the proceeds of sale being held on trust pending my decision.
On 13 November 2020, the Court made orders by consent for the service of further written submissions by the parties as to the significance of the new evidence. Tanya served those submissions on 17 November 2020 and the defendants responded on 1 December 2020.
On 30 November 2020, the Court was advised by Tanya's solicitors that the Fernmount land had been sold for a price of $1,800,000, and that the parties wished to consider the possibility of providing the Court with an agreed statement of facts concerning the significance of the sale. On 15 December 2020, the solicitors informed the Court that an issue had arisen regarding the status of the auction, and that it would not be possible for the parties to settle any agreed statement of facts until the new court term in 2021.
In the meantime, I engaged in the preparation of draft reasons for judgment but, as it happened, ceased that task on 29 January 2021 while the draft was incomplete, in the expectation that the Court would soon receive an agreed statement of facts.
Thereafter, in circumstances that do not require elaborate explanation, there was further delay as a result of the purchaser at the auction defaulting, and the parties facing the need to renew the sale campaign.
On 6 July 2021, the parties delivered to the Court an agreed statement of facts in relation to the sale of the Fernmount land.
In accordance with further consent orders made by the Court on 14 July 2021, Tanya served further written submissions dated 28 July 2021 on the issue of the significance of the sale process and the result of the sale. The defendants responded by serving their final written submissions on this issue on 12 August 2021.
Circumstances did not permit the Court to recommence the task of completing and revising the draft reasons for judgment until 30 September 2021.
Unfortunately, it sometimes happens when proceedings are amended part heard, and where the hearing cannot be concluded in the time allotted, that the exercise in which the Court must engage in formulating its reasons can become protracted. That is in part because the Court is required to properly resolve complex issues long after the forensic contest has passed from immediate memory.
Although the dispute in these proceedings focuses on a limited number of aspects of the administration of Russell's estate, in a real way it brings into play the whole of the administration of the estate over the 45 years since letters of administration were granted to Anne on 23 September 1975.
As will be seen, that fact has considerable significance to the manner in which the forensic issues between the parties must be resolved.

[9]

Order against Anne for an account

By prayer 2, Tanya seeks an order against Anne that she account to Tanya on a wilful default basis in respect of her use of the Fernmount land, and also the proceeds of sale of property that the parties called the Pony Paddocks. Prayer 4 is a claim for an order against Anne that she pay to Tanya the money found to be due to her as a result of the taking of the account. The effect of prayer 4C is that Tanya seeks an order under Uniform Civil Procedure Rules 2005 (NSW) (UCPR) r 54.3 that Anne verify the estate accounts.
Before I comment further on this aspect of the relief sought, I should briefly explain the reference to the Pony Paddocks.
Between 1981 and 1987, Anne received a total of $83,296.89 in a number of payments from Russell's mother, Ellen. Those payments represented in total one third of the net sale price of certain land that the family called the Pony Paddocks. Tanya claims that Ellen held the Pony Paddocks on trust for Russell and his two siblings in equal shares, as a result of the Pony Paddocks having been purchased by Ellen with money supplied by Russell's paternal aunts, for the purpose of being held on trust for Russell and his siblings. Tanya contends that, when the one third of the proceeds of sale was paid by Ellen to Anne, it formed part of Russell's estate, and ought to have been distributed to the persons entitled on intestacy. That did not happen, and Anne applied the money for other purposes. I will explain this aspect of the dispute in more detail below.
For present purposes, it should be noted that, by prayer 2, Tanya seeks an order that Anne account for the proceeds of sale of the Pony Paddocks, together with her use of the Fernmount land generally, on the basis of wilful default. As mentioned, Tanya seeks an order that Anne verify the estate accounts.
For the moment, I record that this order for the verification of estate accounts, if made, would impose upon Anne the Herculean, but more probably impossible, task of reconstructing what was done with the Fernmount land and the proceeds of sale of the Pony Paddocks over a period of some 45 years.
By prayer 4B, Tanya seeks an order against Anne that she indemnify Tanya in respect of the loss of Tanya's share in the proceeds of sale of the Pony Paddocks.

[15]

Claims pleaded by Tanya

Tanya has made a number of separate claims in support of the relief that has been set out above. I will generally deal with those claims in the order in which they have been pleaded in the FASOC.
However, it will be convenient to refer to Tanya's claim that Anne has failed to properly administer Russell's estate first, as that is the basic underlying claim that Tanya makes.
It will be appropriate to foreshadow that the most significant factor in this case is the existence and effect of an informal and imprecise arrangement that operated within the Perry family for many years, which the parties called the "family deal". The family deal took one form during the minority of Anne and Russell's children, but continued in another form with the involvement and consent of the children up until about October 2015.
During the minority of each of Anne and Russell's children, they did not have capacity to consent in a binding way to Anne conducting the administration of Russell's estate other than conventionally in accordance with her duties as administrator. However, when each child attained their majority, they were free to take whatever proceedings were necessary in respect of Anne's past and future administration of the estate. None of the children did so. Instead, up to a time shortly before the commencement of the proceedings, when Tanya repudiated the family deal, all members of the family had agreed or acquiesced in the manner in which Anne applied the assets in the estate. Essentially, Anne administered Russell's estate in accordance with the family deal and not her strict obligations as an administrator under a formal grant of letters of administration.
Notwithstanding the undoubted significance of the family deal, it was not formally pleaded by any party. However, the family deal emerged, even if somewhat obliquely, out of a set of representations that Tanya pleaded were made by Anne over the decades to Tanya, as a ground for absolving Tanya of her delay in instituting these proceedings. I have called those representations, which I will set out below, the Fernmount land representations. The defendants admitted some of the Fernmount land representations and accepted that others were made in slightly different terms to those alleged by Tanya. In this way, the defendants partially embraced Tanya's reliance on the Fernmount land representations, and said that the representations in reality were no more than a component of the family deal, by which all of the Perry family had agreed to and acquiesced in the manner in which Anne had administered Russell's estate.

[17]

Tanya's claim for an interest in and for the use of the Fernmount land

The defendants admitted [4] Tanya's allegations that, on 27 January 1975, Anne transmitted Russell's half share in the Fernmount land to herself as administrator, and thereupon held that share on trust for herself and the children during their minority [5] . They also admitted that, in 1976 or 1977, the dwelling house on the Fernmount land burnt down, and Anne received $15,000 as half of the fire insurance proceeds.
Tanya alleged that Anne held the $15,000 on trust for the persons entitled under Russell's intestacy [6] . The defendants responded to this allegation [7] by admitting it, but adding that, despite having full knowledge, Tanya did not take steps until the commencement of these proceedings to assert an interest in the insurance policy proceeds, and has thereby acquiesced in Anne's use of those proceeds; that Tanya's cause of action is statute barred; and that Tanya has waived any right to any beneficial interest in the insurance policy proceeds.
The defendants admitted [8] Tanya's allegation that Anne applied the sum of $15,000, and borrowed $2,000, to fund the purchase of Ray's half share in the Fernmount land [9] .
Tanya then alleged [10] that, from about 1977, Anne became the sole registered proprietor of the Fernmount land, which she held for herself and on trust for the children in accordance with their entitlements to Russell's estate. The defendants responded to this allegation [11] by admitting that Anne became the sole registered proprietor of the Fernmount land. However, they added allegations that Anne only held a share of the Fernmount land on trust for the children. Anne contributed significant additional funds to retain and maintain the property over a long period of time. Tanya made no financial contribution to maintaining, improving and preserving the property, which was done by Anne at her own expense, or with the assistance of Mark and Michelle. Consequently, the defendants alleged, Anne only held part of the unimproved capital value of the Fernmount land on trust for Tanya, as it had no house on it at the time that Anne purchased Ray's half share.
In further derogation from Tanya's claim that Anne held the whole of the Fernmount land on trust as part of Russell's estate, the defendants alleged [12] that Anne had occupied the Fernmount land continuously, and paid $150,000 towards the improvement of the Fernmount land given to her by her late brother in approximately 1990. They alleged that Anne erected the new residence in about 1977 to 1978 at her own expense, relying on her labour and that of her brothers. The defendants further alleged that Anne was the owner of an insurance policy on the life of Russell, and that the proceeds of the life insurance policy generated, on 4 October 1978, a fund of $30,000 that was used by Anne for the construction of improvements on the Fernmount land. Anne relocated to the Fernmount land a substantial shed that had been acquired with the life insurance monies. Anne continued to service loans and built other improvements on the Fernmount land, including a piggery built with a Rural Assistance Loan that was serviced by Anne. Anne took out a business loan to carry out final renovations to the residence on the Fernmount land in about 1998 or 1999. Anne paid all outgoings for the Fernmount land until Mark left school at age 14, after which Mark, and later Mark and Michelle, contributed labour and funds towards the maintenance, outgoings and repairs of the Fernmount land over time. Mark and Michelle currently pay all significant outgoings for the Fernmount land, and do maintenance in lieu of paying any agistment fees for their dairy herd. The defendants alleged that Tanya has never paid any outgoings for the Fernmount land.
On the first day of the hearing, the defendants' counsel explained their position on the issue of whether Tanya still has an enforceable interest in the Fernmount land. That position appears to be different to that which would arise out of aspects of the FAD summarised above. The defendants' position is that Tanya continues to have an enforceable two ninths interest in the Fernmount land [13] , but that interest is only in the unimproved value of the Fernmount land comprising Russell's half interest and the portion of Ray's half interest purchased with the fire insurance proceeds [14] .
In apparent anticipation of the defendants' allegations that Tanya had delayed seeking any relief concerning her interest in the Fernmount land, Tanya pleaded the following allegation [15] : The first defendant had, over a period of years after the death of the deceased and ongoing until the commencement of these proceedings, represented to the plaintiff: - (i) that her entitlement to her father's estate was 1/9 of one-half share of the Fernmount land; (ii) that she had purchased a half share of the Fernmount land belonging to the Deceased's brother with funds sourced solely from her own borrowings; (iii) that she would remain on the Fernmount land until her death and divide it equally between her children in her will; (iv) that any decisions affecting the Fernmount land would be the subject of discussion and agreement between the plaintiff, the first, second and fourth defendants; and (v) that the names of the plaintiff, second defendant and fourth defendant could not be put on title to the Fernmount property as to do so would have adverse stamp duty and capital gains tax consequences.
I will call these representations the "Fernmount land representations".
In response [16] the defendants admitted that Anne made representations (i) and (iii). They admitted representation (iv) in part, in that Anne made the representation to the extent that decisions would be the subject of discussion, but they denied that the representation included the words "and agreement". The defendants denied that Anne made representations (ii) or (v). Finally, the defendants alleged that, insofar as Tanya pleads a cause of action based upon the Fernmount land representations, they were made more than six years ago, so that the cause of action is statute barred by s 48 of the Limitation Act 1969 (NSW) (Limitation Act).
Tanya alleged that she relied upon the Fernmount land representations in not seeking to require Anne to administer Russell's estate or to distribute Tanya's share of the estate [17] . The defendants denied this allegation [18] .
Tanya then alleged that she had suffered the following detriments by reason of her reliance upon the representations [19] , which the defendants denied [20] : a. she allowed the first defendant to continue to reside on the Fernmount land without accounting to the plaintiff for her occupation; b. she allowed the second and third defendants to benefit from the Fernmount land by using that land in their dairying business and by occupying a house on the Fernmount land from time to time without accounting to the plaintiff for the use and occupation; and c. by not requiring the first defendant to complete administration of the deceased's estate.
Finally, Tanya alleged that the making of the representations was a breach of trust by Anne [21] , in that Anne encouraged Tanya not to make enquiries as to her interest in Russell's estate, and Anne preferred the interests of Mark and Michelle to the interests of Tanya, to her detriment. The defendants denied this allegation [22] .

[18]

Tanya's claim for an interest in the sale proceeds of the Pony Paddocks

Tanya seeks an order that Anne account to her in respect of two ninths of the proceeds of sale of the Pony Paddocks.
Tanya pleaded [23] that Russell's mother, Ellen, held the Pony Paddocks on trust for Russell and his two siblings. The defendants denied this allegation [24] .
Tanya alleged [25] that the trust arose because Ellen had purchased the Pony Paddocks using funds solely provided by Russell's aunts, for the purpose of the Pony Paddocks being acquired on trust for Ellen's three children. The defendants denied [26] this allegation, but added that, if it was true, Anne was at all relevant times unaware of the facts; that Anne made enquiries and was told by Russell's father that Russell did not hold any interest in land other than the Fernmount land; and that Anne dealt with Ellen, by oral agreement, in which no condition was placed upon the distribution of the funds from the sale of the Pony Paddocks by Ellen, or that those funds be paid to Russell's estate.
Tanya alleged [27] that, before their sale, the Pony Paddocks had been held on resulting trust for Russell and his siblings. The defendants again denied [28] this allegation, but added that, if it was true, Anne was unaware that Ellen held the Pony Paddocks on trust; and that Anne acquired the funds in consideration of her work in assisting Ellen to subdivide and sell the Pony Paddocks, so that she took the funds for value without notice. Tanya replied [29] to this defence by pleading that the value of the funds received by Anne exceeded the value of the work done by her on a quantum meruit basis, and that Anne is only entitled to retain the value of the work done on that basis, and holds the balance of the proceeds of sale on trust for Russell's estate.
Tanya then alleged [30] that, between 1981 and 1987, Anne received seven payments totalling $83,296.89 from the sale of Russell's interest in the Pony Paddocks. The defendants denied [31] this allegation, and added that Tanya had acquiesced in Anne's use of the proceeds by not taking any steps until the commencement of these proceedings; that Tanya's action is statute barred or alternatively barred by laches; and that, furthermore, to the extent that the proceeds were not invested in the Fernmount land, they were spent on the maintenance and welfare of Tanya, Anne, Mark and Louise. In her reply, Tanya alleged [32] that she had no knowledge sufficient to ground a defence of acquiescence, waiver, or that her claim was statute barred until 10 March 2016. Tanya pleaded that she would rely upon her response to the limitation defences set out more fully in her reply.
Tanya alleged [33] that, between 1981 and 1987, each of Tanya, Mark and Louise were minors, which was admitted by the defendants [34] .
Tanya alleged [35] that the payments received by Anne from the sale of the Pony Paddocks represented a one third share of the net proceeds of sale of the Pony Paddocks and were made to Anne as part of Russell's estate. The defendants admitted [36] that Anne had received one third of the proceeds of sale but denied the balance of the allegation.
The defendants denied [37] Tanya's allegation [38] that Anne held the proceeds received from the sale of the Pony Paddocks as to one third for herself and two ninths for each of Tanya, Mark and Louise.
Then Tanya pleaded [39] that Anne, in breach of her duties as administrator of Russell's estate, failed to treat the proceeds as estate funds, and spent the proceeds on household and other expenditure. The defendants denied [40] the allegation, other than to plead that the funds were spent on the maintenance and advancement and education of the minor children, including Tanya, and invested in the Fernmount land.
The defendants admitted [41] that Anne no longer holds the proceeds of sale of the Pony Paddocks [42] .
The defendants denied [43] Tanya's allegation [44] that Anne's failure to distribute or account for the proceeds of sale of the Pony Paddocks, as an asset of Russell's estate, was a wilful default, in breach of her duty to administer the estate, and in breach of her duty as trustee for her minor children.
Finally, the defendants denied [45] Tanya's allegation [46] that Anne is bound to indemnify or pay equitable compensation to Tanya for any loss suffered by reason of Anne's wilful default.

[19]

Contributions of beneficiaries to Russell's estate

The defendants admitted [47] allegations [48] by Tanya that Anne and Mark were employed by a business operated by Russell's family, but they were dismissed in 1990. The significance of Tanya's allegation is obscure.
Tanya then alleged [49] that, between 1992 and 1994, she contributed between $200 and $300 per month to the mortgage over the Fernmount land. The defendants denied this allegation [50] and said that Mark contributed a minimum of $520 per month, and also sold cattle to provide funds for the benefit of the Fernmount land [51] .
Tanya alleged [52] that, in 1996 and 1997, she contributed funds to renovate the cottage on the Fernmount land occupied by Mark and Michelle. The defendants responded [53] by accepting that Tanya paid a nominal amount for paint but alleged that was in return for advances made to her by Anne. They alleged that Mark and Michelle contributed financially and provided extensive labour. Finally, the defendants alleged that Anne contributed to the renovation cost of her residence and to the cottage on the Fernmount land.
Finally, Tanya alleged [54] that Mark and Michelle did not pay rent for residing in the cottage on the Fernmount land. The defendants admitted [55] that Mark and Michelle did not pay rent, but said that, in lieu of rent, they carried out and paid for weed eradication, pasture management, cleaning, repairs and maintenance to the entire property, which had fallen into a state of significant disrepair. They said that Mark and Michelle both had employment off the farm, and that they used most of their disposable wages to pay for expenses associated with maintaining the Fernmount land. Mark and Michelle have never been remunerated or reimbursed for their labour on the Fernmount land, or for their contributions to maintenance costs or payment of outgoings. The defendants alleged that the value of the payments and contributions made by Mark and Michelle exceeded the commercial value of any rent that could have been charged for their occupation of the Fernmount land.

[20]

Dealings with the Fernmount land without Tanya's consent

Tanya pleaded a number of claims that Anne, with the participation of Mark and Michelle, breached her duty to Tanya as administrator of Russell's estate by granting mortgages over the Fernmount land without Tanya's consent.
First, Tanya alleged [56] that, from 2002 onwards, Mark used the Fernmount land as collateral for loans to develop his dairying business on another property known as "Caban's". The defendants admitted the allegation [57] , but pleaded that the arrangement was subject to extensive discussions, that Tanya was fully informed of the proposal, and that she gave it her consent and encouragement.
Tanya then pleaded [58] that, on 26 March 2004, in breach of her duties to Tanya and Russell's estate, and without the knowledge and consent of Tanya, Anne permitted Mark and Michelle to mortgage the Fernmount land to the detriment of Tanya. The defendants denied the allegation [59] and alleged that in about January to March 2003 Tanya was made fully aware of the proposal, which was the subject of extensive discussions with Tanya. They alleged that Tanya expressly consented to the proposal. Further, part of the loan proposed involved the borrowing of the sum of $40,000 to refinance a loan taken out by Anne, used for renovations to the Fernmount land. Further, Mark and Michelle had used their own labour and that of their staff and their machinery on the Fernmount land to carry out farm maintenance, repairs, grade roads, improve pasture, and pay outgoings in order to assist Anne in servicing mortgages secured by the Fernmount land. They alleged that at no time did Tanya demand consideration or set terms for her giving consent to the Fernmount land being used for that purpose.
Further, the defendants pleaded [60] that Tanya had been fully informed of the proposal during meetings and that she had consented, or acquiesced, or was estopped from claiming contribution or equitable damages, or had waived such a right. Furthermore, any claim she had is statute barred.
Tanya responded by alleging [61] that she had no relevant knowledge of the transactions sufficient to support a defence of acquiescence, estoppel or waiver until 15 October 2015. Tanya also relied upon her general response to the defendants' limitation defences [62] .
The general response to the defendants' limitation defences pleaded by Tanya is [63] that the relevant causes of action are not based on liability at law; that the obligation of an administrator to account is a continuing one; and that Tanya first discovered the facts giving rise to the causes of action on one of five specified dates between 15 October 2015 and 22 February 2019. Furthermore, Tanya relied upon the Fernmount land representations.
Tanya pleaded [64] that she was under a disability until 14 May 1988 when she turned 18, so that [65] any limitation period was postponed until that time. Tanya pleaded [66] that, after she turned 18, she relied upon the Fernmount land representations, and because of her limited interest in Russell's estate referred to in those representations, did not make further investigations as to her entitlement to Russell's estate.
Tanya then alleged [67] : The plaintiff first discovered that her entitlement under intestacy was as to 2/9ths of the deceased's share of the estate, being: - (a) the funds received by the first defendant for the Pony Paddock; (b) the one-half share of the Fernmount property; and (c) the insurance proceeds referred to in paragraph 17 of the Statement of Claim which was used to purchase 15/17ths of the Fernmount property; when she obtained and read the transcript of the Family Provision Act proceedings on 30 October 2015.
In the circumstances, Tanya pleaded [68] that any relevant bar was postponed until 30 October 2015, given the content of the Fernmount land representations and the reliance by Tanya on them. Consequently [69] , the proceedings were commenced within time.
Finally, Tanya pleaded [70] , in response to the defendants' limitation defences, that the defendants, through their counsel on the first day of the hearing, admitted that Tanya has not lost her proprietary interest in the Fernmount property for limitation reasons, and are not now entitled to withdraw that admission.
Tanya then pleaded [71] another set of representations alleged to have been made by Anne, Mark and Michelle in the following terms: From 2002 onwards the first, second, and third defendants represented to the plaintiff: - (a) that the indebtedness of the second and third defendants was a business loan to the second and third defendants for the purchase of the business at Caban's; (b) that the loan was obtained for the sole benefit of the second and third defendants; (c) that the first defendant was a guarantor for the indebtedness of the second and third defendants; (d) that the second and third defendant would cause their dairying business to be sold before the first defendant's guarantee was called on; and (e) that the Fernmount land was not at risk of being sold pursuant to the guarantee because the second and third defendants would ensure that Fernmount was protected by using their own assets to satisfy any call on the guarantee.
I will call these representations the "Caban's farm representations".
The particulars given for the Caban's farm representations were that they were all made from late 2002 until around Easter 2003 in conversations between Tanya and Anne, and between Tanya and Mark, and at a meeting with a solicitor at which Tanya, Anne, Mark and Louise were present.
The defendants responded to the pleading of the Caban's farm representations [72] by admitting that representations (a), (c) and (d) were made. In response to representation (b), the defendants accepted there was a representation that the loan was primarily for the benefit of Mark and Michelle, but in addition that Anne's remaining mortgage and debts were going to be amalgamated into and discharged with the facility. Otherwise the defendants denied the making of representation (b). As to representation (e), the defendants pleaded that the representation was that the risk to the Fernmount land would be mitigated by Mark and Michelle selling their own assets first, if the guarantee was called upon, and by their having insurance, but they otherwise denied (e).
Tanya then made a number of allegations concerning the Caban's farm representations [73] , each of which was denied by the defendants [74] . Those allegations were that Tanya relied upon the Caban's farm representations and did not take any further steps to investigate the nature of the security over the Fernmount land. Tanya was not informed that the guarantee given by Anne was secured by way of a mortgage over the Fernmount land. Tanya was not informed that the loan to Mark and Michelle included the discharge of the mortgage of $40,000 granted by Anne. In the circumstances, Tanya had not consented to her interest in Russell's estate being encumbered, or Anne using Tanya's entitlement to Russell's estate for the benefit of Mark and Michelle, or at all, or to Mark and Michelle using Tanya's entitlement in Russell's estate for the benefit of Anne, or at all. Tanya suffered a detriment in relying on the Caban's farm representations in that the Fernmount land became subject to a mortgage, and Tanya's interest in the Fernmount land was used to secure a loan to Mark and Michelle. In the circumstances, Anne, Mark and Michelle acted unconscionably in securing the encumbrance over the Fernmount land. Further, Anne acted unconscionably in preferring the interests of herself and Mark and Michelle over the interests of Tanya. Anne, Mark and Michelle are bound to indemnify Tanya against any loss suffered by her; or are liable to pay equitable compensation to Tanya caused by reason of the diminution of funds available to her on the completion of the administration of Russell's estate, and on the basis that it would be unconscionable for Tanya to bear any liability for the indebtedness of Mark and Michelle.
Tanya then turned her attention to a different mortgage granted by Anne over the Fernmount land, this time in respect of the acquisition by Mark and Michelle of a different dairy farm known as "Taylor's Farm".
Tanya pleaded [75] that, on 30 January 2006, in further breach of her duties to Tanya and the estate, and without the knowledge of Tanya and without obtaining Tanya's consent, Anne gave a guarantee in the amount of $1,250,000 for a loan to Mark and Michelle, secured by the granting of a registered mortgage over the Fernmount land, to purchase Taylor's Farm, and to develop Mark and Michelle's dairying interests. The defendants responded to this allegation [76] by pleading that, from the end of October 2005, Tanya was made fully aware by Anne, Mark and Michelle of the proposal to use the Fernmount land as collateral security for the purchase of Taylor's Farm, and that proposal was the subject of extensive discussions between Tanya and all of the defendants. Those discussions involved the possibility of purchasing Taylor's Farm, the nature and extent of any finance to be obtained, the possibility of securing any finance against the Fernmount land, and Tanya and Louise expressly agreed and consented. It was agreed that, if there was any risk of Mark and Michelle not being able to service their finance responsibilities, then Taylor's Farm would be sold. Tanya did not set or insist upon any other terms when providing her consent. Tanya encouraged Mark and Michelle to carry out the proposal.
The defendants responded further to this allegation by Tanya [77] by alleging that Tanya was fully informed during meetings and conversations, that she gave her consent, that she had acquiesced, that she was estopped, that she had waived her rights, that they were statute barred, and that Tanya was disentitled to relief by reason of her laches.
Tanya then alleged a further set of representations concerning the circumstances in which the Fernmount land was mortgaged to support the purchase of Taylor's Farm by Mark and Michelle. Tanya alleged [78] : From late 2005 onwards the first, second, and third defendants represented to the plaintiff: - (a) that the indebtedness of the second and third defendants was a business loan to the second and third defendants secured over the land at Taylor's Farm; (b) that the loan was obtained for the sole benefit of the second and third defendants; (c) that the indebtedness of the second and third defendants was limited to $1,000,000; (d) that the first defendant was a personal guarantor for the indebtedness of the second and third defendants; (e) that the second and third defendants would cause the dairy business to be sold before the guarantee by the first defendant was called on; and (f) that the Fernmount land was not at risk of being sold pursuant to the guarantee because the second and third defendants would ensure that the Fernmount land was protected by using their own assets to satisfy any call on the guarantee.
I will call these representations the 'Taylor's Farm representations'.
The particulars given by Tanya of the Taylor's Farm representations were that they were oral and made from late 2005 to early 2006 in discussions between Tanya and Mark over the phone and in person.
The defendants responded to this allegation by Tanya as to the making of the Taylor's Farm representations by pleading [79] that representation (a) was made, but it was further represented that the purpose of the loan was also to refinance the remaining finance that had been taken out to secure the Caban's farm business. The defendants admitted representation (b) but added that it was also represented to Tanya that Mark and Michelle would be paying the outgoings of Anne. The defendants admitted representations (d) and (e) but denied representation (c). In response to the allegation of representation (f), the defendants said that the representation was that the risk to the Fernmount land would be mitigated by Mark and Michelle selling their own assets first, if the guarantee was called upon, and by having their insurance. Otherwise they denied representation (f).
Tanya then made a series of allegations based upon the Taylor's Farm representations, [80] each of which was, subject to one exception, denied by the defendants [81] . Those allegations were that Tanya relied upon the Taylor's Farm representations and did not take any further steps to investigate the nature of the security over the Fernmount land. Tanya was not informed that the guarantee was secured by way of mortgage over the Fernmount land in addition to a mortgage over Taylor's Farm, that the terms of the mortgage included a redraw facility, or that the amount guaranteed was $1,250,000. In the circumstances, Tanya had not consented to her interest in Russell's estate being encumbered, or Anne applying her entitlement in Russell's estate for the benefit of Mark and Michelle, or at all. Further, Tanya suffered a detriment in relying upon the Taylor's Farm representations in that the Fernmount land became subject to a further mortgage and her interest in the Fernmount land was used to secure the loan to Mark and Michelle. In the circumstances, Anne acted unconscionably in preferring the interests of herself and Mark and Michelle over the interests of Tanya. Further, Anne, Mark and Michelle acted unconscionably in granting the guarantee and securing the encumbrance over the Fernmount land. Anne, Mark and Michelle are bound to indemnify Tanya against any loss suffered by her, or liable to pay equitable compensation to Tanya caused by reason of any diminution of funds available to Tanya on the completion of the administration of Russell's estate, and on the basis that it would be unconscionable for Tanya to bear any liability for the indebtedness of Mark and Michelle and the guarantee given by Anne. The exception to the defendants' denial of Tanya's allegations was that [82] the defendants did not deny Tanya's allegation that she was not informed that the terms of the mortgage included a redraw facility. The defendants did not admit that allegation either, as they did not claim to have a relevant recollection.
Tanya then pleaded further allegations concerning an increase in the amount of the Taylor's Farm loan secured by a mortgage over the Fernmount land.
Tanya pleaded [83] that, in about December 2013, in further breach of her duties to Tanya and the estate, without the knowledge of Tanya and without obtaining Tanya's consent, Anne gave a guarantee for $1,310,000 of a debt owed by Mark and Michelle secured by an encumbrance on the Fernmount Land, for the renovation of and to have erected improvements on the land owned by Mark and Michelle, to the detriment of Tanya. The defendants responded [84] by denying the allegations and by pleading as follows. For 12 to 18 months prior to the mortgage, Tanya was made aware of the proposal. The use of the Fernmount land as security was the subject of extensive discussions at meetings on the telephone and in person between Tanya and the defendants. Tanya and Mark specifically discussed the serviceability of the increased finance required for the new dairy building, when measured against the anticipated improvement in Mark and Michelle's business productivity, as anticipated after the construction of the new dairy. Tanya consented to and encouraged the use of the Fernmount land for the purpose. Tanya visited the land owned by Mark and Michelle during the period in which renovations to the improvements on the property occurred and had knowledge of how the additional finance was being applied.
The defendants responded further [85] by repeating their claim that Tanya was fully informed of the proposed transaction, that Tanya participated in meetings and conversations at which the transaction was proposed, that she consented, despite having full knowledge she acquiesced, that she was estopped, that she has waived her right to any remedy, and that her claim to relief is barred by laches.
Tanya pleaded [86] that Anne, Mark and Michelle did not inform Tanya that the guarantee was extended from $1,250,000 to $1,310,000, and that the renovation and improvement of Taylor's farm was funded by the extension of Anne's guarantee.
The defendants responded [87] to this allegation by admitting the fact of the increase in the guarantee and repeating their responses to pars 35 and 36 of the FASOC.
Tanya then alleged [88] that Anne, Mark and Michelle did not inform her that the guarantee by Anne was further extended between 18 August 2007 and 21 March 2015 from $1,250,000 to $1,609,000, by 15 separate transactions for specified purposes connected with the operation of Mark and Michelle's properties. The defendants responded [89] to this allegation by admitting the facts of the increases in the guarantee. They said that the increases referred to in FASOC par 34(e) to (g) were temporary limit increases and repaid in accordance with their terms. The defendants alleged that Tanya consented to the guarantee without any limitation on the value of the loan or the guarantee. The defendants informed Tanya from time to time that the loan had been varied but not the specifics of those variations. Tanya took no steps to enquire about or oppose those variations. Accordingly, Tanya is estopped from claiming contribution or equitable damages. Further, Tanya has waived any right to contribution or equitable damages. Alternatively, Tanya's claim is barred by laches. Finally, the defendants pleaded that Tanya's claims in FASOC par (a) to (i) are statute barred. The increase in the guarantee referred to in (i) occurred on 5 February 2013.
Tanya made a series of allegations [90] concerning the consequences of the increases in the guarantee, all of which were denied [91] by the defendants. Tanya pleaded that she continued to rely upon the Taylor's Farm representations. In reliance on those representations, she did not take any further steps to investigate the nature of the security over the Fernmount land until about October 2015, when requests for an accounting were refused by Anne. In the circumstances, Tanya has not consented to her interest in Russell's estate being encumbered, or Anne applying Tanya's entitlement in Russell's estate for the benefit of Mark and Michelle, or at all. Tanya suffered a detriment in relying on the representations in that the Fernmount land became subject to a further mortgage and her interest in the Fernmount land was used to secure the loan to Mark and Michelle. Anne, Mark and Michelle acted unconscionably in granting the guarantee and securing the encumbrance over the Fernmount land. Anne acted unconscionably in preferring the interests of herself and Mark and Michelle over the interests of Tanya. Anne, Mark and Michelle are bound to indemnify Tanya against any loss suffered by her, or are liable to pay equitable compensation for loss or damage to Tanya caused by reason of the diminution of funds available to her on the completion of the administration of Russell's estate, and on the basis that it would be unconscionable for her to bear any liability for the indebtedness of Mark and Michelle and the guarantee given by Anne. Anne is bound to indemnify Tanya against any loss suffered by her caused by the wilful default of Anne in relation to the mortgage and guarantee over the Fernmount land.

[21]

Tanya's joint venture claim

Tanya pleaded a claim arising out of an agreement between Tanya and Louise, with the consent and cooperation of the other defendants, to jointly develop part of the Fernmount land to erect ecologically sustainable accommodation and facilities (the joint venture agreement).
In relation to the joint venture agreement, Tanya pleaded [92] a number of matters, all of which were denied [93] by the defendants. Tanya alleged that the joint venture agreement was made in about March 2008 between Tanya and Louise. It was made by oral agreements between Tanya and the defendants between about 21 to 24 March 2008 (the Easter 2008 meeting), and Tanya and Louise shortly before 21 March 2008 and shortly after 24 March 2008. The joint venture agreement was subsequently recorded in several written documents listed in the particulars to FASOC par 37AA.
The joint venture agreement contained the following express terms: (a) the plaintiff and the fourth defendant would benefit from any increase in the value of the Fernmount land resulting from the approval of the Development Application; (b) the joint venture agreement was to equalise the use of the property the second defendant had enjoyed and the benefit the second defendant had received in building his business and purchasing Taylor's Farm; (c) the second defendant could continue to operate his business on the front third of the property; and (d) a trust structure would be established to protect the interests of all parties after the DA had been approved.
Tanya alleged that Anne and Mark consented to the joint venture agreement and to the express terms that were pleaded.
The steps allegedly taken by Tanya in pursuit of the joint venture were then set out [94] .
The defendants pleaded [95] that they do not know and cannot admit Tanya's allegation [96] that, on 29 April 2008, Tanya and an identified town planner attended the Fernmount land to discuss development options with Anne.
The defendants admitted [97] Tanya's allegation [98] that, on 8 September 2008, Tanya and Louise registered the business name "Perry Eco Developments" as the proprietors of the business.
The defendants admitted [99] Tanya's allegation [100] that Tanya prepared a business plan for Perry Eco Developments for the construction of ecologically responsible holiday units and a conference centre to be erected on the Fernmount land.
The defendants admitted [101] Tanya's allegation [102] that, from 2008 to 2010, Tanya and Louise prepared and lodged a development application with the local council. The defendants further said that they also contributed to the lodging of the development application.
Tanya's allegation [103] that, on 9 December 2010, the development application was approved by the local council with an operational date of 28 March 2011 was admitted [104] by the defendants.
The defendants also admitted [105] the allegation [106] by Tanya that the development consent was to lapse on 28 March 2016, unless building work commenced in accordance with the development application.
Tanya then alleged [107] that she undertook the necessary demolition and building work on the Fernmount land at her own expense, prior to 28 March 2016, to ensure compliance with the development approval. In response, the defendants denied [108] that demolition and building work was done at Tanya's own expense, insofar as the work took place prior to the development consent. They said that while Tanya made some financial contribution to this work, financial contributions were also made by Anne, Mark and Michelle. Further, the employees of Mark and Michelle were used in relation to the work together with Mark and Michelle's equipment. Otherwise, the defendants admitted the allegations.
The defendants admitted [109] Tanya's allegation [110] that Tanya took the necessary steps at her own expense to ensure that the development approval was substantially commenced and therefore recognised by the local council as attaching to the land.
Tanya then alleged [111] that, but for the work done and the expenses incurred by Tanya in securing substantial commencement, the development approval would have lapsed. The defendants admitted [112] this allegation, and said that, but for the work done and the expenses incurred by the defendants as well, the development approval would have lapsed.
The defendants denied [113] the allegation made by Tanya [114] that the registration of the development application on the title of the Fernmount land has materially increased the value of that land.
Tanya alleged [115] that the Fernmount land was worth, at 1 January 2018, $1,375,000 without the development approval and $1,725,000 with the development approval.
Tanya then made a series of allegations [116] , all of which bar one were denied [117] by the defendants. Tanya's allegations are that she undertook approximately 80% of the work and spent approximately 40% of the funds required to obtain the development approval. The increase in the value of the Fernmount land which is attributable to the development approval is $350,000, or otherwise as determined on sale of the Fernmount land. In the circumstances, it would be unconscionable for Anne and Mark to assert a beneficial interest in the increased value beyond their own expenditure in support of the joint venture agreement. It would be unconscionable for Louise to assert a beneficial interest in the increase in value beyond her own expenditure, given the work done by Tanya and Tanya's securing the substantial commencement of the development approval. Tanya alleged that, in the circumstances, Anne holds the Fernmount land subject to a constructive trust, so that Tanya is entitled to an interest in the increase in value reflective of her time and effort, which is substantially more than half of the value of the increase. Anne, Mark and Michelle are liable to indemnify Tanya against any loss caused to her by reason of any diminution of funds available to her in satisfaction of her entitlement to a proportion of the increase in value caused by the development approval, on the basis that it would be unconscionable for her to bear any liability for the indebtedness of Mark and Michelle and the guarantee given by Anne.
The defendants responded to the whole of the FASOC by pleading [118] : The Defendants further say in response to the whole of the Further Amended Statement of Claim that to the extent that the contributions of the Plaintiff are to be taken into account in determining her entitlements, including but not limited to the alleged contributions relating to the development application, the contributions of the Defendants to the value and maintenance of the Fernmount property and to the procurement of the Development Application should also be taken into account in determining the entitlements of all parties including the Plaintiff.

[22]

Some preliminary observations concerning issues of fact

An obvious feature of the present case is that the events that are relevant have occurred over a period spanning some 45 years.
Few of the issues arise out of individual events that occurred during this period. The administration of Russell's estate during the collective minority of the children spanned 23 September 1975 to 14 June 1992, when Louise attained her majority. That is a period of about 17 years. Thereafter, during all of the children's majority, Anne has administered Russell's estate for a further 28 years or so. Many events relevant to the use and improvement of the Fernmount land occurred on numerous occasions throughout this period. The Fernmount land representations are said to have been repeated on numerous occasions over the years. The family deal developed and evolved over the same period.
In relation to the Pony Paddocks claim, Tanya relies, as will be seen, on her recollection of comments made by her grandfather when Tanya was about five years old. As noted above, Anne received the Pony Paddocks proceeds in seven payments between 1981 and 1987.
Tanya alleged that she made contributions to mortgage payments between 1990 and 1994, and that she contributed funds to renovate the cottage on the Fernmount land in 1996 and 1997. Anne claims that she made very substantial improvements to the Fernmount land on many occasions during the minority of her children. Mark and Michelle claim that they made improvements to the Fernmount land regularly and continuously from even before the time that Mark left school at the age of 14 years.
Tanya's claim that Anne breached her duty as administrator by encumbering the Fernmount land with mortgages relied upon conduct that commenced in 2002 and continued from that time, with additional relevant events in 2004 and from 2015 onwards. The Caban's farm representations were alleged to have been made from late 2002 until around Easter 2003. The Taylor's Farm representations were alleged to have been made from late 2005 to early 2006.
Even the joint venture agreement concerning the eco-tourism lodge development was alleged to have been made in about March 2008, and significant events relevant to the variation of the proposal occurred at different dates after that time.
This case raises acutely the problem that occurs with many family disputes that have percolated through the decades, where there are serious practical limitations on the quality of the evidence that the parties are able to give, and consequently the nature and precision of the findings of fact that can be safely made by the Court.
As Emmett J (as his Honour then was) said in Warner v Hung, in the matter of Bellpac Pty Ltd (recs and mgrs apptd) (in liq) (No 2) [119] : [48] Under s 140(2) of the Evidence Act 1995 (Cth) (the Evidence Act), the court must, in deciding whether it is satisfied that a case has been proved to the requisite standard, take into account: • the nature of the cause of action or defence; • the nature of the subject matter of the proceeding; and • the gravity of the matters alleged. When proof of any fact is required, the court must feel an actual persuasion of the occurrence or existence of that fact before it can be found. Mere mechanical comparison of probabilities, independent of any belief in reality, cannot justify the finding of a fact. Actual persuasion is achieved where the affirmative of an allegation is made out to the reasonable satisfaction of the court. However, reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequences of the fact to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, and the gravity of the consequences flowing from a particular finding are considerations that must affect whether the fact has been proved to the reasonable satisfaction of the court. Reasonable satisfaction should not be produced by inexact proofs, indefinite testimony or indirect inferences (see Briginshaw v Briginshaw (1938) 60 CLR 336 at 361-2).
See also to similar effect Neale v Bank of Western Australia [120] .
This is a significant consideration in this matter, as much of the cases of all of the parties depend upon their assertions as to what was said by themselves and others in the relatively distant past. As McLelland CJ in Eq famously said in Watson v Foxman [121] (in the context of whether alleged statements were misleading and deceptive): … Furthermore, 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. Each element of the cause of action must be proved to the reasonable satisfaction of the court, which means that the court "must feel an actual persuasion of its occurrence or existence". Such satisfaction is "not … attained or established independently of the nature and consequence of the fact or facts to be proved" including the "seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding": Helton v Allen (1940) 63 CLR 691 at 712.
His Honour was concerned with the reliability of evidence of a relatively small number of statements claimed by a party to have been made orally a considerable time before the hearing. The forensic problem that his Honour addressed may be compounded by orders of magnitude when, in reality, what the witnesses are attempting to do is to give evidence of a distillation of the effect of numerous conversations made in a family or social context, long in the past and over a considerable period, between a number of people, not all of whom may have been present and participated in all of the conversations. As I have said previously in a similar context in Spink v Flourentzou [122] : [181] The problem that McLelland CJ in Eq so perceptively explained is amplified where the reality is that the same subject was discussed frequently by the members of a family, at a time of family unity, in different locations where, as the evidence shows was true in the present case, the parties were initially reluctant to make the arrangement, but persuaded themselves over time that it was safe and prudent for them to do so. It is almost certain that the proposal was put in different ways by the different parties using different words over the period, and that the proposal may have evolved in its substance and in the way that it was described by the participants. The participants were not contemplating making a clear, formal agreement that would be enforceable at law. It is likely that the participants used expressions intending those words to have a particular meaning and assuming that the others participating understood the intended meaning. [182] In these circumstances, the Court is presented with limited and distilled evidence from the perspective of the individual witnesses which is said to have given rise to an arrangement, whether that alleged in the paragraphs of the statement of claim, or that which is implied in the defence.
In these circumstances, the following considerations, as stated by Hallen J in Evans v Braddock [123] , accepted by Sackar J in Campbell v Campbell [124] , and by myself in Meshumar v Otmy, [125] apply: [74] A court, in cases involving events which occurred long before the litigation, usually prefers to rely upon contemporaneous, or near contemporaneous, documents, which will often provide valuable and, usually, more revealing, information than what may be flawed attempts at recollection of those facts by persons with an interest in the outcome of the litigation: Bathurst Regional Council v Local Government Financial Services Pty Ltd (No 5) [2012] FCA 1200, per Jagot J, at [1247]. Greater weight is usually accorded to such documents, as often they provide a safer repository of reliable fact, particularly when it is clear that they have been prepared by a person with no reason to misstate those facts in the documents and where there is no suggestion that the documents are other than genuine: Hughes v St Barbara Mines Ltd [No 4][2010] WASC 160, per Kenneth Martin J, at [157]. … [76] The circumstances of this case, make what was written by Tamberlin J in Lake Cumbeline Pty Ltd v Effem Foods Pty Ltd (trading as Uncle Ben's of Australia) (Federal Court of Australia, Tamberlin J, 29 June 1995, unrep), at 122-123 (in a passage cited with approval by the High Court when it upheld his Honour's decision: Effem Foods Pty Ltd v Lake Cumbeline Pty Ltd [1999] HCA 15 ; (1999) 161 ALR 599, at [15]) appropriate to remember: [Given the lapse of time] between the events and conversations raised in evidence and the hearing of the evidence before me, the only safe course is to place primary emphasis on the objective factual surrounding material and the inherent commercial probabilities, together with the documentation tendered in evidence. In circumstances where the events took place so long ago, it must be an exceptional witness whose undocumented testimony can be unreservedly relied on. The witnesses in this case unfortunately did not come within that exceptional class. The discussions referred to in evidence were capable of bearing quite opposed meanings depending on subtle differences of nuance and emphasis, and a proper appreciation of the significance of those matters must necessarily be considerably diminished over such a long period of time. …
These observations reflect the fact that it is sometimes feasible for the Court to resolve differences in the recollection of witnesses, as to what was said and done far in the past, by giving weight to objective probabilities that are established with relative confidence, or by contemporaneous documents. It is, however, a significant feature of the present case that there is a relative dearth of contemporaneous documents. That circumstance may reflect the fact that many of the relevant events occurred within the context of the affairs of a then relatively harmonious family, and because the need for the parties to gather corroborative evidence only became apparent in late 2015.
Notwithstanding the inherent fallibility of evidence given by the witnesses in this case based upon distant memory, both sides made comprehensive submissions as to why the Court should accept the evidence given by their witnesses as being valid and reject the reliability of the other side's witnesses [126] . Each side directed the Court's attention to inconsistencies between the evidence given by witnesses and other evidence available to the Court.
I have not found it useful, in the present case, to try to distinguish the general level of credibility of the different witnesses by carrying out a detailed exercise of comparing isolated aspects of their evidence with apparent inconsistencies with other sources.
As Kunc J said in Pavlis v Pavlis [2021] NSWSC 1117 (generously citing an earlier judgment delivered by me): [167] Ninth, the Court can only do the best it can on the evidence which it has. Some issues may need not be resolved or should not be resolved. It may be that they cannot be resolved given the nature of the evidence which the parties have adduced. This case has many similarities to the family dispute considered by Robb J in Ak-Tankiz v Ak [2014] NSWSC 1044. Of the evidence in that case, his Honour said at [187]: The principal evidence relating to these issues consisted of the uncorroborated evidence of the witnesses, or alternatively the only corroboration available was the testimony of other witnesses. The evidence distilled into the word of one witness against the word of one or more other witnesses. Most of the events relevant to the issues occurred many years ago. The evidence relevant to the issues generally consisted of a series of assertions, and counter-assertions by various witnesses. Evidence of the objective context was generally not available, so it has not been feasible to test the versions of events that were in contest by reference to the objective probabilities, based upon uncontroversial contemporary circumstances. Though the issues are not entirely irrelevant, their significance is limited, and their resolution has not been necessary for the purpose of determining the real issues in the case. Any attempt to resolve the issues by making judgments about the relative credibility of the individual witnesses on an issue-by-issue basis was likely to be based on illusory foundations.
I consider that each of the witnesses generally attempted to give truthful evidence, based upon their recollection of events. However, all of the witnesses, save for Ray, were apparently to some extent influenced by their perception of events, over a significant period of time, through the filter of their reaction to the family breakdown. I did not consider that any of the witnesses were so transparently credible that I would make findings of contentious facts based solely on the witnesses' evidence. The witnesses' evidence was to some degree fallible, and it has not proved to be realistic to make reliable estimates of relative credibility.
As already noted, the parties have asked the Court to accept the credibility of their evidence and reject the credibility of the evidence given by the other side. This is in circumstances where the reality is that the Court is asked to accept each side's distillation of the effect of numerous conversations and events relevant to the particular topic.
Given the span of years to which the findings in this case must relate, it is not generally realistic for the Court to express its findings in a precise sense. The findings represent a broad distillation of what is expressly or implicitly established by the pleadings, relevant aspects of the evidence of the witnesses accepted in a general way, and the objective evidence of the manner in which the parties apparently conducted themselves.

[24]

The Pony Paddocks

The question of whether Russell's estate included the money received by Anne from the sale of the Pony Paddocks or whether Anne received that money in her personal capacity involves complexities that warrant separate consideration.
It was common ground that Anne received a total amount of $83,296.89 from the sale of the Pony Paddocks in tranches, as follows: $16,500 on 18 March 1981, $13,000 on 13 November 1981, $9,497.89 on 22 December 1981, $11,500 on 4 May 1982, $10,200 on 18 June 1982, $11,178 on 3 July 1984, and $11,420 on 1 June 1987 [128] . These payments were all received before Tanya reached her majority in May 1988.
At the hearing, evidence was given about the circumstances in which the Pony Paddocks were acquired and the property was subdivided and sold, and whether payments of a third of the net sale price to Anne may have been Anne's own money or received by her as to two thirds on trust for her children. As I have explained above, Tanya was given leave to reopen her case, which led to affidavits being filed by Ray's wife, Vicki, and by Anne.
Tanya gave the following evidence [129] concerning her knowledge of the dealings with the Pony Paddocks: 7. On Friday, 30 October 2015, on the plane to Sydney, I read the transcript of Ellen's Estate Proceedings… 8. … Ultimately I instructed my solicitors to send the letter to the defendants' solicitors dated 9 November 2015, a copy of which is annexed and marked 'B'.
Tanya's solicitors' letter included the following: Administrator misappropriating estate assets From about 1981 to 1987, monies were received by Anne Perry on behalf of the estate of the late Russell Perry from the subdivision of land referred to by the Perry family as the "Pony Paddock". The land was purchased and held on trust for the late Russell Perry and his siblings, Ray Perry and Ruth Lackie by their mother, Ellen Veronica Perry. This land was not declared in the estate of Russell William Perry. When the land was subdivided it was split equally between the estate of Russell Perry, Ray Perry and Ruth Lackie. Anne received a one-third share on behalf of the estate of Russell William Perry. This money has not been distributed in accordance with the intestacy rules as they were in 1975.
The letter also included an extract from the cross-examination of Anne in earlier proceedings relating to Ellen's estate. Anne accepted that she, Ray and Ruth had received money from the sale of the Pony Paddocks. She said: A.… That Pony Paddock was subdivided, and we each shared in payments from it. There were expenses in creating the road, particularly blackbutt and forest and Lines Road. I managed to get it cut, Lines Road, that we didn't have to put the whole of the road through. But I don't have - no, I can't tell you exactly how much money I received from that, because I haven't, I just don't have it.
Asked what she did with the money from the sale of the Pony Paddocks, Anne responded: A. No, the monies actually went into improvements on the Fernmount property.
Anne's solicitors' 3 December 2015 response to this letter included the following: To say that Anne has misappropriated funds for her own benefit has caused considerable hurt and offence. Funds from the sale of the "Pony Paddock" were indeed received by Anne. This occurred while Ellen Veronica Perry was alive. These funds did not form part of Russell Perry's estate. These funds did not form part of Ellen Veronica Perry's estate. Anne personally performed most of the administrative tasks and organisation associated with the subdivision for her mother in law and subsequently Ellen Veronica Perry shared some of the proceeds of the sale of the Pony Paddock lots with Anne while making an equal distribution to her other children. There was never any declaration that these were to be trust funds for Anne's children. Funds received were used to buy a caravan for family trips, to improve the piggery and to install a swimming pool. Funds were used for the benefit of all family members and to improve the farm.
Tanya's evidence [130] continued as follows: 10. As a child, on several occasions the precise details of which I cannot now recall, I was told by my paternal grandfather, Carl Perry (Carl), and/or his wife, Ellen, words to the effect that the pony paddock was purchased from money received by their three children, being the deceased, my uncle Raymond and my aunt Ruth, from wealthy aunts in Armidale. My grandfather, Carl, told me words to the effect he had "carefully invested the money and not wasted it". 11. I had been aware from conversations which I overheard during my childhood that the first defendant received money from the sale of the Pony Paddocks referred to in paragraph 17 of my First Affidavit. I cannot recall the precise details of these conversations. I understood from these conversations that the sale proceeds had been split equally between my aunt Ruth, my uncle Raymond and the first defendant. 12. On or about 10 March 2016 I visited the registry of this Court to inspect a copy of the affidavit sworn by my uncle, Raymond Perry, in Ellen's Estate Proceedings. 13. On 30 October 2015, I was aware by reading the transcript of the first defendant's evidence in Ellen's Estate Proceedings that the total amount first defendant received was $83,296.89, on or about 10 March 2016, when I read Raymond's affidavit I became aware of: (a) the amounts of those payments and the dates on which they were made; and (b) that the share paid to Anne was for her and her 3 children.
Tanya's knowledge of the circumstances in which the Pony Paddocks were acquired was the subject of the following cross-examination [131] : Q. Your position is that what you were intending to communicate in paragraph 10 is that the money was money that had been saved that had been sent through by the aunt at different times during her lifetime? A. For birthdays and Christmases, that's correct, and that it was saved and I can remember thinking to myself when being told this story how horrible it was that my father wasn't getting presents. He was made - being forced to - to actually put the money in the bank, though I believe my - my grandfather was teaching a lesson at the time around the importance of saving money and why it was repeated to me on many occasion this story of - of the money being saved and then invested. Q. So it's your understanding that this money was received prior to the purchase of the pony paddock? A. Yes. Q. All right, thank you. Do you recall how old you may have been when you overheard these childhood conversations? A. My grandfather raised me from the - up until the age of five and a half when I moved to Bellingen. I would spend every day with him on the verandah and we would - whilst everyone else was in the butcher shop working, he would spend a lot of time with me. And he would tell me stories and we had a close relationship in that way. Q. And although you don't remember the precise words, that's roughly what you think you were told? A. It was a story that he was making a point around how to live my life and it was him saying, "You need to save your money," and he would make a big deal of - when I started school, there was those school savings bank books that you would take money each week to school to put in the bank, and he would make sure I had that money to put in the bank each week. And it was part of him educating me and - but I can vividly remember thinking how horrible it was that dad wasn't getting presents, like
Tanya's affidavit evidence was given more than 40 years after the conversation said to have occurred between Tanya and Carl happened. Tanya was about five years old at the time. For obvious reasons, the Court would be very hesitant to accept this evidence in the absence of adequate corroboration.
Tanya called Ray on subpoena to give evidence concerning the Pony Paddocks issue. Ray, it turned out, was one of those people who are sometimes described as "a character". Perhaps the most convincing evidence that Ray gave was when it was put to him that Anne did not ask him to pay her share of the money from the Pony Paddocks, he responded [132] : I might have been there or I mightn't have been there, right? It was 40 years - give me - look - look - my old brain's not the best, you know, like -
This was quite a reasonable response on the part of Ray, given the passage of some 40 years. Ray made a number of other responses to similar effect.
The thrust of Ray's evidence was that Carl had purchased the Pony Paddocks using money raised from buying, breeding and selling ponies, as well as using some of his children's money. Ray's evidence was not consistent with Tanya's claim that the money was paid by the children's aunts. Ultimately, the Pony Paddocks was sold because it had ceased to be economic to use them for holding ponies. Ray was adamant that Carl managed the subdivision and sale of the Pony Paddocks, even though he acknowledged that his father had died in about 1982 and some of the payments were made after that year. Ray appears to have thought that the Pony Paddocks were held in the name of Carl and he did not know that in fact they were owned by Ellen. Ray's evidence was that the net proceeds of sale of the Pony Paddocks were paid to him by Carl with the instruction that he was to hold Russell's share until Russell's children attained their majority. Although Ray's evidence was not expressed clearly, it appeared to be to the effect that Anne had asked Carl and Ellen to require Ray to pay to her Russell's children's share of the money and Carl had given him an instruction to do so.
Ray was a cooperative witness, but his evidence was relatively disjointed and unpersuasive. Overall, his claim that he held Russell's children's share of the net proceeds of sale of the Pony Paddocks appears to be inconsistent with the balance of the objective evidence.
Anne was not able to give any evidence about the circumstances in which the Pony Paddocks was acquired as that occurred long before she met Russell.
Anne's evidence was that Ellen said to her that the Pony Paddocks needed to be sold and that Anne advised her to subdivide the property as it may make her some money. Anne said [133] that she had a conversation with Ellen to the following effect after they had attended a council meeting in relation to the proposed subdivision: Ellen said: If we do a subdivision of the Pony Paddocks you will have to help us. If we can make some money, you, Ray and Ruth can have a share of it equally, I am not interested in the profit, I just want the land sold. I need you to assist me with all the administrative tasks associated with getting the subdivision approved by Council, as well is dealing with the contractors who will be engaged to do the works. I need you to attend to all paperwork matters associated with the development. You will also need to obtain the necessary quotes for builders and others. I said: Ok. I will assist you where I can.
Anne gave extensive evidence of the assistance that she gave to Carl and Ellen in the process of subdividing the Pony Paddocks and selling the lots in two stages over about a three-year period. For instance, the defendants tendered minutes of Council meetings that recorded her advocacy for her parents-in-law's subdivision application [134] .
Anne's evidence about her substantial involvement in the process of subdividing and selling the Pony Paddocks was not challenged in cross-examination. The only exchange that I have found was in the following terms [135] Q. You would do what you were asked to do by Carl, to put things into train. A. Yes. Q. One of those things that he asked you to do was to do some things around selling the pony paddocks. A. Yes.
Anne did accept that the Pony Paddocks were paid for using money earned by Carl from selling ponies that he had allocated to his children [136] : Q. And then when the pony paddocks were bought, they were also bought with money that Carl allocated to the children from selling ponies. A. Yes. Q. So when that land was put in Ellen's name, it was purchased for the children, in effect, using some of their money. A. Yes. Q. So when it was sold, that's why one-third went to Ray and one-third went to Ruth. Do you agree with that? A. Yes. Q. Your share went to you but you only got a portion of that share, is that correct? A. No. Q. You heard what Ray said yesterday. A. Yeah, I heard what he said yesterday. Q. That he has a recollection of holding the moneys in trust for the children. Do you say that didn't happen? A. Didn't happen.
Anne also gave evidence that she was told by Carl in the office of the solicitor for Russell's estate after his death [137] : I own all of the farm at Repton other than some land at tuckers Rock Road called the Pony Paddocks, they are owned by wife Ellen. Russell does not have an interest in our farm, he just lived there. The only land forming part of my son's estate is the Fernmount land that he owns with his brother. The bulldozer and machinery belong to me.
In cross-examination, Anne reaffirmed her evidence that Carl told her in the solicitor's office that the Pony Paddocks was owned by Ellen. Senior counsel said that she would come back to the issue but did not do so.
Anne's affidavit evidence on the subject of the Pony Paddocks continued as follows [138] : 53. I also recall that the subdivided lots were sold over about a 3 year period… Once lots were sold the settlement funds, after payment of real estate agent commissions and legal fees, were placed into a bank account in my name, my sister-in-law's name and my brother-in-law's name… … 55 At no time in the course of the subdivision of the Pony Paddocks or when sales had been made of any of the subdivided lots, did Ellen or anyone else say that the money that I was to receive for the work that I had done in relation to the subdivision was to be paid to my children or were to form part of Russell's estate.
Vicki gave evidence in her 17 September 2020 affidavit that she happened upon a number of cheque books on 14 September 2020, when she was looking through some boxes of old records to see whether she could locate any photographs of Russell that might be of interest to Tanya. Vicki annexed to her affidavit four cheque stubs dated 18 March 1981 that record $16,500 being paid to each of Ray and Ruth, $5,500 to Anne and $11,000 to "Al Perry Trustee for TL, MW and LA". Vicki said that the cheque stubs were written in Anne's handwriting. The two last cheques add up to the $16,500 that Anne acknowledges she received on 18 March 1981. The ratios of the amounts of the cheques is one third to two thirds, which is consistent with the respective entitlements of Anne and her children to Russell's intestate estate.
Vicki also said that the cheque books also contained stubs for other payments to Al Perry Trustee for TL, MW and LA Perry with the following dates and amounts: 13 November 1981 ($8,667), 22 December 1981 ($9,497.89, broken into $3,165.96 and $6,331.93), 4 May 1982 ($7,667), 18 June 1982 ($6,800), undated ($7,452) and 1 June 1987 ($7,613.54). For reasons that were not explained, these cheque stubs were not annexed to Vicki's affidavit. There was no reference in the affidavit to cheque stubs for payments to Ray, Ruth or Anne personally.
The amounts of these cheque stubs equated to two thirds of the total amounts accepted by Anne as having been received by her on the stated dates (the undated cheque stub matches the 3 July 1984 receipt).
Anne responded to Vicki's evidence in her 27 October 2020 affidavit as follows: 6. The bank account from which the cheques were drawn was a bank account set up at my insistence and with the approval of my mother in law Ellen Veronica Perry. It was set up after I agreed to assist Ellen Perry with the subdivision of her land. 7. I recall that funds from the sale of the land referred to in these proceedings as "The Pony Paddocks" were banked to this account following the conveyancing… From this account I paid expenses such as rates for the properties and any other costs. I would get Ellen's consent to pay bills and draw funds but I would draw the cheques… 8. In regards to paragraph 11 of the affidavit of Vicki Perry, I was involved in the drawing of the cheques from the bank account that was in three names, Raymond Perry and Ruth Perry and my name. The account was not set up as a trust account for me and my three children. The cheques may refer to "RL Perry" but it is my belief this is supposed to be "AL Perry" - Russell's middle name was William - otherwise it would have been RW Perry. I recall the account being opened specifically to receive monies from the sale of Ellen's land and that I was to be one of three signatories. It was not an account that existed at the time that my husband died. 9. In the 1980s and 1990s I had accountants and solicitors in my life that gave me advice and prepared accounts for me for my own farming business. I cannot recall how the funds received from the sale of the Pony Paddocks were treated by me in the course of my own accounting but they were banked to my account. I did not have any other account that I can recall. I do not recall what advice I obtained about how to treat the funds received from the sale of the Pony Paddocks, and no longer have documentation of that advice. I also no longer have access to the conveyancing files. 10. I no longer have access to my taxation records from that period. 11. The decision to draw cheques in the manner and amounts and percentages presented in the material attached to Vicki Perry's affidavit would have been made by me. 12. All money that I received from the sale of the Pony Paddocks went into my bank account. I no longer have access to my bank statements from that period.
The Court was asked to receive these two affidavits into evidence, but the parties did not request the Court to make arrangements to enable the deponents to be cross-examined.
In relation to Vicki's evidence that the cheques were drawn on an account that included the name "RL Perry", and that this was an erroneous reference to Russell, Anne responded by saying that any error was a failure to refer to her, that is, the reference should have been to "AL Perry", because she caused the account to be opened and was a signatory, and Russell's middle name started with "W". I consider that Anne's evidence is probably the more correct, both for the reasons that Anne gave, and because it is improbable that an account would have been opened in the name of a deceased person. It would be usual for a bank in that circumstance to require that the account be opened in the name of the administrator as administrator of the estate of the deceased.
On Anne's evidence, the cheque account was used for transactions relevant to the subdivision and sale of the Pony Paddocks. Anne accepted that the cheques were in her handwriting. The notations on the cheque stubs that payments were made to Anne as trustee for her children plainly suggest that at the time the cheques were drawn, Anne understood that the Pony Paddocks were an asset of Russell's estate, to which she was entitled to a third and her children were entitled to two thirds between them. It is difficult to conceive of any other explanation, and Anne did not suggest one.
Anne submitted that, given the passage of time since the proceeds of sale of the Pony Paddocks were received by Anne, the new evidence should be treated only as raising speculative possibilities. Anne relied upon the fact that the inventory included in her affidavit filed in support of her application for letters of administration of Russell's estate did not disclose that Russell had an interest in the Pony Paddocks. Anne's evidence that the affidavit was prepared by her solicitor based upon instructions given by Carl was not challenged in cross-examination. Anne's submission was to the effect that, if anyone knew what Russell's interests in property were, it was Carl.
The conclusion that I have reached, on a bare balance of probabilities, is that Anne did receive the share proceeds of the sale of the Pony Paddocks as an asset of Russell's estate. That finding is based upon the relative probative significance of Anne having described the payments in a way only consistent with them being payments to Russell's estate in the cheque stubs written in her own hand. It is possible that, when Carl gave instructions to the solicitor, he did not have in mind that the Pony Paddocks had been purchased with money allocated to his children, or he may have been in two minds at that stage as to whether or not Ellen held the Pony Paddocks on trust for the children. Technical issues of trust may not have been at the forefront of Carl's mind at the time.
However, although I have preferred this finding on balance, it is not a finding that I make with confidence. While the cheque stubs provide apparently persuasive evidence, the passage of time has had the effect that it has not been possible for Anne to recover any relevant records, or to recall the precise reasons why she filled out the cheque stubs as she did. I remain prepared to accept the evidence given by Anne concerning the offer made to her by Ellen for the payment of a one third share in the proceeds of sale of the Pony Paddocks in return for Anne's assistance in the subdivision and sale of the Pony Paddocks. I consider that, at this remove in time, it is entirely unrealistic to expect that the Court could make reliable findings concerning the relevant events in the period up to 1 June 1987, when the last payment was received by Anne. As will be seen below, the finding that I have made on the issue of whether Anne received the share of proceeds of sale of the Pony Paddocks as an asset of Russell's estate is not conclusive on the issue of whether Anne should be found liable to Tanya for breach of her duty as administrator of Russell's estate.
This is a case in which it is appropriate to adopt the approach stated by O'Loughlin J in Cubillo v Commonwealth of Australia (No 2) (2000) 103 FCR 1; [2000] FCA 1084 (as cited by Kunc J in Pavlis v Pavlis (above) at [164]): A trial judge is not restricted in his or her assessment of a witness. By this I mean that if, on peripheral issues, the trial judge reaches conclusions adverse to the credibility of a party, it does not necessarily follow, consistently with such conclusions, that these must be findings adverse to that party on the issues that are central to the determination of the matter. There is no rule of law or practice that states that an adverse finding on any aspect in the evidence of a witness means that the whole of that witness' evidence must be rejected.
As it has been necessary to review the evidence given by Tanya in cross-examination in relation to the Pony Paddocks issue, it will be convenient at this point to record the following evidence that Tanya gave as to why she did not make a claim to a share of the proceeds of sale of the Pony Paddocks at an earlier time than she did [139] : Q. Why wait until you're in your 40s to say something about it then? A. Because when I was - when myself and the legal team were researching for this case, we applied for transcripts and affidavits to do with the 2003 case that was part of the family, and part of that was the affidavit of Ray Perry, and there was a reference in there that he made, and that, if you like, jogged my memory around what I had been told as a child, and that's what's prompted me to include that. Q. You commenced these proceedings by way of statement of claim in - when was it? November - a filed statement of claim on 10 November 2016? A. Yes. Q. The pony paddock was part of your case when you commenced those proceedings? A. Yes.
Tanya was also cross-examined about the significance of the family deal to her failure to assert her rights as a beneficiary of Russell's estate until her solicitor's 9 November 2015 letter to which reference has been made above [140] . Q. So you knew as a child but you certainly knew as at the age of 18, that you had an entitlement to a share in the property? A. I did. Q. But you did nothing about asserting that entitlement until you commenced these proceedings? A. Because of the family deal. Q. But there was nothing that was there - you weren't encouraged not to make further inquiries about anything, were you? A. This was a deal that had a lifespan of my mother's life. Q. Well, you - you mean, your life? A. No, my mother's life. Q. I'm sorry, I don't understand what you mean. A. The deal was that she could live on the property until she died. Q. Right but you could have asserted your interest at any stage, at least on becoming on 18? A. That was something that just - you couldn't do. Q. Well, you were under no disability, were you? A. To throw my mother off the property and claim my right at that time was something that couldn't be done. Q. But you were under no disability? A. No. Q. You could have obtained legal advice? … Q. Ms Perry, I'll just come back a moment, if that's okay - you could have obtained legal advice any time from the age of 18? A. As Ann, herself, has placed in her affidavits, it wasn't the family thing to do - is to go get legal advice and take action around our rights and the agreement. It's - I don't know how to put it into words but it - it would have been seen as a complete betrayal of the family had I done so. It would have removed me from the family as it has done so when I did challenge in October 2015. Q. Ms Perry, the answer to my question, I think, is you could have obtained legal advice, the answer is "yes"? A. Yes, I could have. Q. You chose not to obtain the legal advice? A. Because of the deal. Q. But no one said to you - no one stopped you from obtaining legal advice in relation to your interest? A. It was unspoken that had I, I would have been rejected from the family.
On Tanya's own case, improbable though it may have been, she had a definite understanding since the age of five that her father had an interest in the Pony Paddocks. She did not pursue her claim against Anne for maladministration of Russell's estate because of her acceptance of the family deal. Her decision to make a claim in relation to the proceeds of sale of the Pony Paddocks was triggered (in the sense that her memory was jogged) by information she received from reviewing the evidence in the proceedings concerning Ellen's estate.

[25]

Administration during Tanya's minority

The best evidence of how Anne administered and expended Russell's estate during the minority of her children was given by Anne. I accept this evidence as being generally correct, at a level sufficient to enable the Court to determine Tanya's entitlement to the relief that she seeks, without that acceptance meaning that Anne's evidence is comprehensive and precisely correct in all respects.
I accept Anne's evidence that she was told by the solicitor who acted for her in obtaining letters of administration in respect of Russell's estate that she was entitled to use the children's share of Russell's estate for their education, maintenance and advancement. At the time the solicitor would have given that advice, the only asset of any significance in Russell's estate was his half share in the Fernmount land. Anne did not receive the first payment from the sale of the Pony Paddocks until 1981.
At the time of Russell's death, his estate had almost no liquid funds. Anne began to receive a widow's pension about six weeks after Russell's death. She waited anxiously for the insurance payout on Russell's life insurance policy, which was in the total amount of $16,376. Tanya claimed in the amended statement of claim that the insurance payout was an asset of Russell's estate, but abandoned that claim in the FASOC. Anne had difficulty paying bills and making ends meet.
In September 1975, Anne and her brother Joe purchased land in Bellingen for a price of $6,500 paid for by Joe. Anne and Joe intended that a house would be built on the land suitable for housing Anne and the children, but that plan proved to be financially impracticable.
In February 1976, Anne and Joe sold the Bellingen property for $6,800, which was given by Joe to Anne.
Approximately 12 months after Russell had died, Anne received the payout under Russell's life insurance policy.
Anne then purchased another property in Bellingen for $27,000. The property had a home in which Anne intended that she and her children would live. Anne borrowed about $20,000 from the Bank of New South Wales, which she used, with the life insurance proceeds, to buy the home, to pay associated costs and to buy furniture, and to assist her in starting a small business from which she hoped to earn an income.
In April 1976, Anne and the children moved into the property with Anne's mother. Anne's mother assisted Anne with the young children, in particular while Anne was trying to make a success of the small children's clothing shop that she had opened in Bellingen. Anne also did some bookwork Carl's butcher shop in order to get extra income so that she and the children could live.
Anne was not able to make the clothing shop a financial success, and she had to close the shop within a relatively short time after opening it. Anne fell back on doing more bookwork and working at her parents-in-law's butcher shop.
In about 1977, a fire destroyed the old residence on the Fernmount land. Anne used her $15,000 share of the insurance proceeds, together with an amount of $2,000 borrowed from the Bank of New South Wales, to buy Ray's half share in the Fernmount land for $17,000.
Carl and Anne's two brothers assisted her in building a new house on the Fernmount land to provide a home for Anne and her children.
In October 1978, during the construction of the new house on the Fernmount land, Anne sold the property in Bellingen for $30,000. The family lived in a caravan on the Fernmount land for a number of weeks while the house was being finished.
Once the family moved into the Fernmount house, Anne's mother also moved in to provide Anne with extensive assistance in raising the children, and also minding them when Anne was working.
Joe assisted Anne in making pig pens in an old barn on the Fernmount land, so that Anne could make an income. Anne applied for a Rural Assistance Loan of about $25,000 to expand the piggery, and to buy a truck and tractor to operate the farm. Anne's brothers, Joe and Peter, built the piggery. The piggery was eventually sufficient to run ten sows, two boars and their progeny.
In around 1979, Joe moved into the house on the Fernmount land to assist Anne with the manual work on the property. Joe paid for the construction of a two-bedroom prefabricated home on the Fernmount land, which the parties have called the cottage. The cottage was used to house Anne's brother Peter and his wife. Subsequently, Joe and Peter used their own machinery and money to start a small turf farming business on the Fernmount land.
Anne said that everyone living on the Fernmount land pitched in to lend a hand so that she could try to make financial ends meet.
Anne said in her 6 May 2017 affidavit: 42. Although my bills were paid and there was always good food available I was never comfortable financially. I could not save much on a weekly basis and had to run with a very tight budget. 43. It was a point of pride for me that I wanted to make sure that the children did not go without, always looked well presented, and had fine manners. They were for the most part well-behaved…
After about four years of Anne, with the help of her brothers, trying to make a living running pigs, the effect of the large feed costs and the market value of the pigs falling required Anne to subsidise her income working five days a week between 10am and 3pm in the family butcher shop.
Anne said, in respect of the payments that she received from the sale of the Pony Paddocks: 56. From the funds that I received from the sale of lots within the subdivision of the Pony Paddocks, I undertook renovations to the residence at the Fernmount property. I also had a pool installed at the property for my children. I purchased a caravan for the children and myself to go on holidays and to go to ballroom dancing competitions as far away as Victoria. Each of the children came with me on those holidays. 57. I also believe that I used some of the money that I received from the subdivision proceeds to reduce some of my debt. However, most of the funds were expended on general living expenses, raising of children, and providing them with some comforts after a difficult period. 58. I did not want my children to go without. I made sure that they would get a good education and they were able to participate in extra-curricular activities despite this costing me financially. The children all went to the local public school and high school but I paid for Louise and Tanya, to have a private tutor, Mrs Gardener so as to assist them with their studies. I employed her for Tanya's last three years of high school and Louise went from year 9 onwards. 60. In addition, Mark and the girls were heavily involved in ballroom dancing which I saw as a wonderful off-farm recreation for myself and the children. I spent a lot of money on costumes, lessons and travel associated with that activity alone. 61. We travelled extensively to go to dancing competitions. Although these trips were hard work and meant lots of driving, I recall them as being good times and I did not get any more enjoyment than watching my children excel and enjoy this recreation.
Anne's evidence of how she spent the proceeds she received from the sale of the Pony Paddocks was supported by evidence given by Ray in cross-examination that Anne had told him at an earlier date that she had spent the money on the farm and the home [141] .
In approximately 1983, Anne became aware that a local dairy was looking for local suppliers of milk. She decided to sell the pigs and the 30 head of cattle that she ran on the Fernmount land with a view to going into the dairy industry. Anne purchased a second hand vat and her brothers helped her fix up the old dairy sheds on the Fernmount land. Anne purchased 30 head of dairy cows. Anne began educating herself on how to run a dairy property, including how to artificially inseminate cows, as she did not have the money to buy bulls. Anne's brothers and the children assisted Anne.
When Tanya was in her senior years of high school, she decided to start a small ballroom dancing studio in the Bellingen township. Anne supported her by driving Tanya to and from the studio for lessons where Tanya earned her own money teaching students.
In approximately 1988, Tanya finished high school and, in 1989, Tanya moved out of home.
In Tanya's 17 July 2017 affidavit in reply, she denied that any renovations were undertaken to the Fernmount land with the proceeds of sale of the Pony paddocks, and asserted that Anne used the money to buy a new bedroom suite for her room and to start racing two racehorses.
Anne elaborated on her evidence in her 1 February 2018 reply to Tanya's affidavit. Anne denied that she bought a bedroom suite with the Pony Paddocks money. She said that she paid for small repairs and improvements around the house and farm and fenced the new pool.
Anne explained that she owned one racehorse with Ray and the other horse was owned by Anne's brothers. Anne said that she paid expenses from her own funds. Anne only had an interest in the horse for a couple of years. Anne said that, with the prize money, the exercise was almost cost neutral and she did not use any funds from the sale of the Pony Paddocks for this purpose.
Tanya's evidence as to how Anne expended the money she received from the sale of the Pony Paddocks was stated in the form of a bald assertion. Tanya did not explain how she, as a young person between the ages of about 11 and 17, came to know how her mother had expended the money. There is no reason to believe that Tanya had objective grounds for knowing how Anne applied the various limited sources of income that were available to her.
In the circumstances, I prefer Anne's evidence on this issue over Tanya's assertions.
Tanya did not otherwise challenge the evidence given by Anne as to how she administered and expended Russell's estate during the minority of the children.
In summary, Anne used the Fernmount land for most of the duration of the minority of her children as the home of herself and her family. She used the land in various farming businesses to raise income for the family. She made substantial improvements to the Fernmount land from her own and her family's resources. She allowed members of her family to reside on the Fernmount land without payment, other than the provision of services that contributed to the extended family's welfare. Anne earned an income by working off the Fernmount land that she applied for family purposes. Anne applied the proceeds she received from the sale of the Pony Paddocks in making some improvements to the Fernmount land, and also in an undifferentiated way for the benefit of herself and her children. Anne did so upon legal advice that she was entitled to apply her children's share in Russell's estate for their education, maintenance and advancement. Anne did not realise the Fernmount land, and did not invest the children's shares in order to accumulate income during their minority. Anne used the Fernmount land for family purposes, and not to earn income on a strict commercial basis. I infer that Anne did not maintain strict trustee accounts or preserve vouchers. I also infer that Anne has not, over the ensuing period, retained records that would permit her to provide a strict accounting to Tanya for the administration of Russell's estate.

[26]

Breaches of trust alleged by Tanya

The first step in the process of answering the questions that arise concerning Tanya's entitlement to the relief that she claims, insofar as it related to Anne's administration of Russell's estate during the period of Tanya's minority, is to set out Tanya's statement of the breaches of duty that she alleges against Anne [142] : 1) Failure to keep estate assets separate from her personal estate; Particulars [143] : a. [Use of $2000 of her own borrowed funds with the fire insurance proceeds to buy half of the Fernmount land. Use of the Fernmount land to house Anne, the children, Anne's mother, her two brothers and Peter's wife]. 2) Failure to comply with her fiduciary duty to the estate: Particulars: a. The estate assets were held in trust by the administrator on her own behalf (as to one third) and her three minor children (as to 2/9 each); b. The administrator's duty to the estate required her to apply the estate assets in the most efficient and profitable manner available to her during her appointment in order to maximise the estate available for distribution to the ultimate beneficiaries; c. The administrator had a duty to the estate to treat any funds which were paid into the estate (i.e., the funds for the children from the Pony Paddocks) as estate funds and to ensure that they were properly accounted for within the estate; 3) Waste, caused by the administrator's failure to use or apply the estate assets for their best and most profitable use during her tenure as administrator and trustee; Particulars: a. Failure to claim rent from family members occupying the cottage; b. Failure to rent out the cottage when not occupied by family members; c. Failure to charge a commercial adjistment rate for cattle; d. Permitting one beneficiary to offset adjistment against property outgoings, including capital costs, thus depriving the estate of income; and e. Allowing the administrator to reside on the property without paying an occupation fee, or any part of an occupation fee, to the estate; 4) Failure to document any agreement to vary the terms of the estate administration, including any agreement to delay the estate administration; 5) Failure to document any agreement to grant the administrator a greater right, title or interest in the estate than she had at law; 6) Failure to document any agreement to grant a beneficiary a greater right, title or interest in the estate than they had at law; 7) Preferring the interests of one beneficiary over others; 8) Failure to keep proper accounts; 9) Failure to produce accounts upon request; 10) Failure to distribute, pay or transfer the estate to the beneficiaries; 11) Denial of the beneficiaries' right to call for the administration of the estate to be completed; 12) Denial (until the commencement of these proceedings) to recognise the beneficiaries' interest in the estate; 13) Denial (until the commencement of the hearing) to acknowledge Tanya's continuing interest in the estate; 14) Delay in the administration such that the administrator should be removed [on the ground of inexcusable delay in administering the estate].
I note for completeness that this list of alleged breaches of duty covers both periods, and some of the breaches may only relate, or substantially relate, to Anne's conduct in the period after Tanya achieved her majority.
In essence, whether by means of a formal verified accounting on a wilful default basis, or by an order for equitable compensation, Tanya now seeks relief against Anne on the basis that Anne was required to keep formal trust accounts during Tanya's minority, and to administer Tanya's interest in Russell's estate on the basis most financially beneficial to Tanya. As an example, Tanya claims [144] that Anne is now obliged to account for income she received when she rented out portions of the Fernmount land to neighbours. Tanya does not volunteer any allowances to Anne for Tanya's occupation and use of the Fernmount land as her home, for Anne's expenditure of her own funds on improving the Fernmount land, or for Anne's expenditure of her own and estate funds on the maintenance, education and advancement of Tanya during her minority.
Tanya has left entirely out of account where and how the family could have lived if Anne had exclusively applied the Fernmount land in generating income, putting aside the children's share and retaining it, preparing accounts and keeping vouchers in derogation of her income earning activities and her devotion to the proper upbringing of her children.
Although Tanya has primarily sought to recover money from Anne for her alleged maladministration of Russell's estate through the remedy of an account, Tanya has claimed a money sum in relation to Anne's expenditure of Tanya's share of the proceeds of sale of the Pony Paddocks. Tanya claims to be entitled to $18,510.42 as at 14 May 1989. Tanya has claimed [145] simple interest at the Court's pre-judgment rate from 14 May 1989 to 25 September 2018 in the total amount of $52,216.13. Tanya's claim for interest would continue after 25 September 2018 to judgment. Tanya also submitted [146] that she should be awarded compound interest.
The only trust asset that continues to exist is the proceeds of sale of the Fernmount land. As Dal Pont and Mackie, Law of Succession (2nd ed, 2017, LexisNexis Butterworths) (Dal Pont and Mackie) note [147] , one aspect of a trustee's duty to account is to actually give to each beneficiary, at the appropriate time, that beneficiary's share in the estate. As already noted, the defendants have now conceded that Tanya is still entitled to receive her beneficial interest in the proceeds of sale of the Fernmount land, although there may remain an issue about her entitlement to a share in the value of the improvements. Consequently, it will not be necessary for the Court to consider the application of s 47 of the Limitation Act, in-so-far as it establishes a time bar on an action on a cause of action to recover trust property [148] . It will also not be necessary for the Court to consider the defence of laches, or how the subsistence of the family deal affected the running of time against Tanya in respect of this aspect of her claim.
The balance of Tanya's claims against Anne seek the payment of money following the completion of the accounting process, or, as in the case of the proceeds of sale of the Pony Paddocks, equitable compensation in the amount referred to above. It will only be necessary for the Court to consider the effect of the running of time in relation to those money claims.
Notwithstanding that Tanya has sought an order that Anne give a formal account of her administration of Russell's estate on a wilful default basis, Tanya in her written submissions refers to evidence [149] that appears to be relevant to the conduct of the accounting process, in-so-far as it would enable the assessment of the rent that Anne could have earned from the letting of the cottage on the Fernmount land, and from making parts of that land available for agistment at a fee. Tanya submitted [150] that she is entitled to $80,368.88, as two ninths of the rental value of the cottage, and $45,711.11 as two ninths of the agistment value of the Fernmount land. In my view, it is premature for the Court to decide questions that will arise in the accounting process, when the issue before the Court is whether it should order that a formal accounting take place, and if so on what basis.

[27]

Anne's obligations and entitlements as administrator and trustee

It will be necessary to consider whether Anne's administration of Russell's estate during Tanya's minority involved breaches of her duties as administrator and trustee.
That raises the issue of Anne's entitlement to decide what should be done with her children's shares in Russell's estate, and how the Court permits and supervises the use of children's property for their benefit during their minority.
As I understand Tanya's submissions [151] , she says that Anne was not entitled to apply Tanya's share of the capital of Russell's estate in the manner that she did, because that course of action was not authorised by s 44 of the Trustee Act 1929 (NSW) (Trustee Act). That section relevantly provides: (1) Where under a trust a person is entitled to the capital of the trust property or any share thereof, the trustee may from time to time pay or apply any capital money subject to the trust, not exceeding altogether in amount one-half of the value of the property or share, for the advancement or benefit of such person or where such person is an infant, for the maintenance, education, advancement or benefit of such person in such manner as the trustee shall in the trustee's absolute discretion think fit. (1A) The power conferred by this section to pay or apply any capital money subject to the trust for the maintenance or education of a person who is an infant shall not be exercised in any case where the trust property or the share thereof to which the infant is entitled exceeds four thousand dollars. (2) The power conferred by this section may be exercised whether the person is entitled absolutely or contingently on the person's attaining any specified age or on the occurrence of any other event, or subject to a gift over on the person's death under any specified age or on the occurrence of any other event, and, notwithstanding that the interest of the person so entitled is liable to be defeated by the exercise of a power of appointment or revocation, or to be diminished by the increase of the class to which the person belongs. (3) The power conferred by this section may be exercised whether the person is so entitled in possession or in remainder or reversion. (4) If the person is or becomes absolutely and indefeasibly entitled to share in the trust property, the money so paid or applied shall be brought into account as part of such share. … (6) This section applies only where the trust property consists of money or securities or property held upon trust for sale calling in and conversion, and the money or securities or the proceeds of the sale calling in and conversion are not by statute or in equity considered as land, or applicable as capital money for the purposes of Part 4 of the Conveyancing and Law of Property Act 1898. …
The conduct of Anne in administering Russell's estate, as described above, was clearly not authorised by s 44 of the Trustee Act. That provision gives limited statutory authority to trustees to apply the capital of the trust fund for the benefit of infant beneficiaries, without the need for the authority of the Court. The authority is limited because the section authorised trustees to apply capital that has only been given contingently to the particular beneficiary, and consequently the application of the trust fund might turn out to be in favour of a beneficiary who ultimately does not become entitled to the benefit.
I do not accept Tanya's submission that the fact that s 44 of the Trustee Act did not authorise Anne's conduct is the end of the matter. There remains the question of whether, in accordance with equitable principles, Anne remains entitled to claim an allowance for her expenditures for the benefit of Tanya and the children generally, and whether the Court can now retrospectively authorise those expenditures.
The first question is whether Anne was entitled, of her own motion as Tanya's sole parent, to apply Tanya's interest in the estate for the benefit of Tanya and the family. The second question is whether, if Anne was not so entitled, Anne is nonetheless entitled to claim an allowance for benefits bestowed on Tanya in the accounting process, whether as of right, or by order of the Court made on application during the accounting process.
As to the first of these questions, Anne was not only an administrator and trustee, she was also the parent of Tanya and the other children.
As the sole parent of the children, Anne was obliged, to the extent of her reasonable financial capability, to provide for the maintenance, protection and education of the three children: see Department of Health and Community Services (NT) v JWB and SMB (Marion's case) [152] . See also Gillick v West Norfolk and Wisbech Area Health Authority [153] (Gillick).
At common law, a parent has the power to administer the child's property: see Fountain v Alexander [154] . See also Hewer v Bryant [155] .
It may follow from the principle that the parent has power to administer the child's property that, as a bare matter of parental authority, the parent may lawfully apply the property of the child for the proper maintenance, education and advancement of the child. However, as stated by Lord Scarman in Gillick [156] : … Parental rights relate to both the person and the property of the child - custody, care, and control of the person and guardianship of the property of the child. But the common law has never treated such rights as sovereign or beyond review and control. Nor has our law ever treated the child as other than a person with capacities and rights recognised by law. The principle of the law, as I shall endeavour to show, is that parental rights are derived from parental duty and exist only so long as they are needed for the protection of the person and property of the child…
Further, [157] : … A most illuminating discussion of parental right is to be found in Blackstone's Commentaries, 17th ed (1830), vol 1 Chs 16 and 17. He analyses the duty of the parent as the "maintenance… protection, and… education" of the child: p 446. He declares that the power of parents over their children is derived from their duty and exists "to enable the parent more effectually to perform his duty, and partly as a recompense for his care and trouble in the faithful discharge of it: "op cit., p 452. In chapter 17 he discusses the relation of guardian and ward… A little later in the same chapter he again emphasises that the power and reciprocal duty of a guardian and ward are the same, pro tempore, as that of the father and child and adds that the guardian, when the ward comes of age (as also the father who becomes guardian "at common law" if an estate be left to his child), must account to the child for all that he has transacted on his behalf: pp 462-463…
Turning to the passage in Blackstone's Commentaries upon which Lord Scarman relied, it may be seen that Blackstone said [158] : … A father has no other power over his son's estate, than as his trustee or guardian; for though he may receive the profits during the child's minority, yet he must account for them when he comes of age…
By a footnote to this observation, Blackstone referred to a decision of Lord Thurlow LC in Andrews v Partington [159] that is of little direct relevance to the present issue. That case involved a testamentary trust where the trustees had a power to maintain the infant beneficiary out of the income of the trust. Lord Thurlow held that the term empowering the trustees to maintain the infant out of income was always construed to apply only where there was no other source of maintenance for the child. Where the father of the child was living, the father had the duty to maintain the child from the father's own resources. If the power of maintenance in the trust instrument allowed the trustees to maintain the child out of the child's own income, such payments would to that extent relieve the father of the need to maintain the child, and would have the practical effect of providing a legacy in favour of the father. Further, the Court would never make an allowance in favour of the father retrospectively in relation to the cost of maintaining the child.
As subsequent authorities quickly established, and Blackstone acknowledged in his footnote, the rule laid down by Lord Thurlow was reversed. Where the trust instrument contained a power of maintenance of the infant beneficiary out of the income of the child's share of an estate, the Court would, in an appropriate case, authorise trustees to pay for the child's maintenance, without necessary enquiry into the father's capacity to maintain the child from the father's resources, and even retrospectively, after the father had maintained the child for a period out of the Father's resources [160] .
These authorities are not directly relevant to the present case, because they involved trust instruments that gave the trustees a power to maintain the infant beneficiary out of the income of the child's share of the estate. As Russell died intestate, he did not give Anne the authority of a power of maintenance out of income, or advancement out of capital.
The authorities are, nonetheless, of some significance, as they show that the Court would exercise its power to act in the interests of children, to authorise their maintenance by trustees, out of income and to do so retrospectively.
White J (as his Honour then was) considered the issue of the ability of a parent to maintain a child out of property to which the child was beneficially entitled in Dark v Dark [161] . The case involved a family provision application by a parent, and the question was whether the parent could lessen the parent's need for funds by using a child's property for their benefit. White J observed [162] that he had not been able to find any clear authority or statement of principle on this question.
His Honour's review of the law traversed some of the matters that I have examined above, including by reference to Blackstone's Commentaries.
White J concluded on this issue: [86] But the present issue was not considered in those cases. It may be that the common law would now consider that it is a correlative of a parent's duty to maintain, protect and educate the child of which a parent has custody and guardianship, that the parent should be able to have recourse to the child's property for use for the child's benefit in furtherance of the parental duty. This would be consistent with the view of Lord Scarman in Gillick (at 183-184) that parental rights relate to both the person and the property of the child and are correlative with the parent's duty. However, that was not always the case in respect of a child's estate. The position is unclear. [87] However, one undoubted parental right is the right to approach the court for the exercise of the Crown's parens patriae jurisdiction, and that jurisdiction can extend beyond the parent's own right (Secretary, Dept Health and Community Services v JWB and SMB (Marion's case)(1992) 175 CLR 218). [88] Moreover, s 50 of the Minors (Property and Contracts) Act 1970 (NSW) provides that where a minor is beneficially entitled at law or in equity to property, the Supreme Court may, on such terms as it thinks fit, make orders authorising a person, either generally or in any particular instance, to make any disposition of the property or to receive the income of the property where, amongst other things, it appears that the order is for the benefit of the minor. [89] There is no reason to doubt that, if sought, the plaintiff would obtain approval to the use of at least the pension moneys paid to Brianna and Tye to assist with the payment of expenses that are incurred for their benefit. The purpose of the pension payments being made until the children turn 16 must be to provide assistance for their upbringing. In my view, either on application under s 50 of the Minors (Property and Contracts) Act, or in the parens patriae jurisdiction, approval would almost certainly be given for the use of the children's funds, provided the Court were satisfied that each child's money would be applied for his and her benefit.
The better view probably is that, while a parent has control over the child's property during their minority, and a concomitant authority to expend the child's property on the maintenance, education and advancement of the child, the parent is not the arbiter of the justification for that expenditure. If the child so wishes, on attaining their majority, the parent must account to the child. However, for the reasons that I will consider below, it does not follow from the parent's obligation to account that the parent will necessarily be ordered to repay to the child the whole of the amount of the child's property that was spent on the child's maintenance, education and advancement. The parent may be able to establish allowances for which the parent is entitled to credit in the accounting process.
Before I examine the rights of the parent in the accounting process, I should refer to the two authorities upon which the defendants primarily relied in defence of this aspect of Tanya's claim. Those authorities are Countess of Bective v Federal Commissioner of Taxation [163] (The Countess of Bective) and Clay v Clay [164] . The defendants relied upon the following statement by Dixon J in the former case [165] (footnotes omitted): But an obligation to apply moneys in the maintenance of children or others does not involve the liability which arises from an ordinary trust. It is a general rule that guardians of infants, committees of the person of lunatics, and others who are entrusted with funds to be expended in the maintenance and support of persons under their care are not liable to account as trustees. They need not vouch the items of their expenditure, and, if they fulfil the obligation of maintenance in a manner commensurate with the income available to them for the purpose, an account will not be taken. Often the person to be maintained is a member of a family enjoying the advantages of a common establishment; always the end in view is to supply the daily wants of an individual, to provide for his comfort, edification and amusement, and to promote his happiness. It would defeat the very purpose for which the fund is provided, if its administration were hampered by the necessity of identifying, distinguishing, apportioning and recording every item of expenditure and vindicating its propriety. Although these considerations furnish an independent foundation for the general rule, yet, after all, it is a doctrine regulating the application of moneys payable under an instrument, whether a will, a settlement or an order of a Court of equity, and the operation of the doctrine must depend upon the provisions contained in the instrument, both express and implied. But the effect of the instrument will often be governed by the circumstances to which it was intended to apply, and, in particular, by a consideration of the nature of the actual abode, the condition of the household and the state of the family of the infant or other person to be maintained. Courts of equity have not disguised the fact that the general rule gives to a parent or guardian dispensing the fund an opportunity of gaining incidental benefits, but the nature and extent of the advantages permitted must depend peculiarly upon the intention ascribed to the instrument. In Brown v. Smith Jessel M.R. describes conditions which may be contemplated by an order of the Court, and they are material also to the meaning and operation of other instruments providing for maintenance…
The High Court in Clay v Clay approved these observations [166] .
I do not think that these authorities directly establish the point in the present case upon which the defendants seek to rely. They establish that, where a trustee, who has a power to apply the trust fund to maintain a child, provides funds to the child's parent for that purpose, the parent is not treated as a trustee, and is not required to account in the same way as is a trustee, by the maintenance of strict accounts supported by proper vouchers.
In the present case, Anne was both administrator and trustee on the one hand, and parent on the other. The question is whether Anne, in the former capacity, had the authority to apply Tanya's share in Russell's estate for the maintenance, education and advancement of Tanya, in the context of applying Tanya's share in conjunction with the shares of all other beneficiaries for their mutual good. This is not a case where Anne only received the funds in her capacity as a parent.
It may nonetheless be that the concepts that underpinned the authorities upon which the defendants relied will have an important bearing on the resolution of this case. I will return to this issue below.
There is a line of authority in which the Court has authorised trustees to break into the capital of a trust fund held on behalf of a minor for the purpose of the maintenance, education and advancement of the minor in cases where that is necessary in the interests of the child. I am not sure that my research on the subject has been comprehensive. The reports of the cases uniformly do not state the nature of the power that the Court has exercised. I consider that it is most likely that the Court was exercising its jurisdiction as parens patriae to act in the interests of minors. The Courts appear to have proceeded upon the basis that the source of the jurisdiction was obvious. Most of the cases resulted from summary applications. It is difficult to find consistency in the various decisions. This may reflect the fact that the parens patriae jurisdiction is not confined by specific rules [167] , and is required to be exercised in the discretion of the Court in the interests of the minor in its particular circumstances.
Barlow v Grant [168] was decided by the Lord Keeper in 1684. The report of the case included the following: Upon a bill for £100 legacy given to a child, the defendant insisted upon an allowance of £16 a year for keeping the legatee at school. It was objected that only the bare interest of the money ought to have been expended in his education, and not to have sunk the principal, as in this case the defendant had done. But the Lord Keeper thought it fit and reasonable to be allowed; and said, the money laid out in the child's education was most advantageous and beneficial for the infant, and therefore he should make no scruple of breaking into the principal, where so small a sum was devised, that the interest thereof would not suffice to give the legatee a competent maintenance and education: but in the case of a legacy of £1000 or the like, there it might be reasonable to restrain the maintenance to the interest of the money.
A note in the report to this paragraph included the following observation: … Trustee shall not of his own authority break in upon the infant's fortune, Walker v Wetherell, 6 Ves. 473. From these cases the rule seems to be that the Court will not permit of executors and trustees to break in upon the capital of infants' legacies without the sanction of the Court, and that the Court itself though it will break in upon the capital for the purpose of advancement, will rarely do so for the mere purpose of maintenance.
In Ex parte Green [169] , an application was made for an order authorising the principal sum of £298 belonging to two infants to be applied for their maintenance. They had no other property. The Master of the Rolls is reported as having said "that as the sum was so small, he would venture to make the order".
The brief report of the case stated that the order was made without a reference. I take this to refer to the usual Chancery practice of the matter being referred for report by a Master or clerk as to the amount needed for the maintenance of the minor. It appears that the Master of the Rolls took the view that the estate should not be put to the expense of a reference, so his Lordship made the order without one being undertaken.
A similar order for the payment of small sums of capital to which minor beneficiaries were entitled was made by Lord Lyndhurst LC in Ex parte Chambers, in the Matter of Chambers [170] .
In Robison v Killey [171] , Sir John Romilly MR said, in a case where the will authorised the trustee to advance any part of the presumptive share of his children "not exceeding one half" for their maintenance or advancement, and where the trustee sought retrospective authority for having advanced more than one half of the capital to the children: It has frequently happened that this Court has considered it necessary that the capital of infants should be applied for their maintenance, where there has been no other means for their support…"
The Master of the Rolls then addressed the issue that "the trustee has gone beyond it without asking any sanction from the Court, and his representative now asks to be allowed in the first place the whole amount thus expended in the maintenance of the infants".
His Lordship gave the authorisation sought, although, as it was made retrospectively, he ordered the trustee to bear the costs of the application, in‑so‑far as the remaining trust fund was not sufficient to meet both the costs and the future maintenance of the children.
A number of early decisions have dealt with applications for authority by trustees to meet the maintenance needs of children out of the capital of trust funds held on their behalves [172] . While the decisions were not entirely consistent, there were cases in which, at least where, as in the present case, the interests of the children were not contingent, an order was made that permitted maintenance out of capital [173] . It should be added that it is not entirely clear whether the courts required that the children have absolutely no other source of maintenance. In my view, if maintenance out of capital is to be authorised at all, it should be authorised in cases wherever the alternative source of maintenance is inadequate.
The decision of Holroyd J in Kerferd v Perpetual Executors and Trustees Association of Australasia Ltd [174] is of some significance. In that case, his Honour said [175] (footnotes omitted): I quite assent to the proposition of counsel for the trustees, that, if the Court would upon application have authorised them to expend for the support of the widow and children any portion of the corpus, the Court would not hold them liable to account for having incurred such expenditure without previous authority. But would the Court have permitted the corpus to be so broken in upon? I think most certainly not. When a legacy is left to an infant absolutely, but is of such small amount that the income is quite inadequate for its maintenance, and there is no other source out of which the infant can be maintained, the Court will reluctantly, and so far only as is absolutely necessary, grant leave to breaking upon the corpus until he can earn his own livelihood. The cautious principles on which the Court acts in the supplying an omission in a testator's will, for such it is considered, are illustrated by several cases in our Courts, as, for instance: Re Moylan; Re Giles; Re Dwyer; Re Hyland; the last a case of advancement for which the corpus is more readily broken in upon than for maintenance. I know of no authority for ordering the application of any part of the corpus towards the maintenance of the infant, when the gift of the legacy is not absolute, but contingent - and here the interests of each one of the children in the corpus of the testator's estate is contingent, for it is impossible to foretell which of them may be alive when the youngest surviving child attains twenty-one years. The general, and except as already mentioned inflexible, rule is that the Court must not make a will for the testator…
This decision is also significant for the principle that, if the Court would upon application have authorised trustees to expend for the support of children any portion of the capital of the estate "the Court would not hold them liable to account for having incurred such expenditure without previous authority".
This aspect of his Honour's judgment was specifically approved by Gordon J in Caterpillar Financial Australia Ltd v Ovens Nominees Pty Ltd [176] and by Reeves J in Re Pleash (as joint and several liquidators of Suncoast Restoration Pty Ltd (in liq) [177] .
It should be added that a number of decisions have held that, in the absence of a power to apply the income of a trust fund for the maintenance of an infant entitled to the fund, the Court may make an order authorising the expenditure after it has occurred: see Brown v Smith [178] ; Irwin v Jones [179] ; and In re Richards [180] . In the last-mentioned case, Long-Innes J said [181] : … As regards future maintenance the Court takes a liberal view, and, where the estate of the infant admits, will make an allowance for the future maintenance of an infant without expecting that the whole amount allowed will necessarily be expended solely on the infant. The Court regards it as for the benefit of the child that in certain circumstances a considerable, perhaps the greater, portion of the amount allowed should be spent on persons other than the child itself, for instance, its mother, or brothers and sisters, and even its father. As regards past maintenance, however, the matter stands on a different footing. The cases of Bruin v Knott (1 Ph 572); In re Hodges; Davey v Ward (7 Ch D 754), and Brown v Smith (10 Ch D 377) establish I think, two principles, first, that in no event will the Court allow for past maintenance an amount greater than that which it would have allowed had an application been made for an allowance in respect of future maintenance before it had in fact been incurred; and, secondly, that of such amount only so much will be allowed as was in fact actually expended. Those principles, however, still leave the matter in some doubt, and I have had some difficulty in determining what rule I should apply in the present case. The conclusion to which I have come is that where an application is made for an allowance in respect of past maintenance the Court ought not to start with the assumption that, because the infant has been suitably maintained, the expense of maintaining the whole household should be regarded as an expenditure incurred in the maintenance of the infant, but should only allow such an amount as was actually expended on the infant, or by which the expenditure which would have been incurred in any event was increased by reason of the necessity for providing for the maintenance of the infant. Where, as in the present case, the scale of living has been fixed and plans made, not with the view of maintaining the infant in that station of life and on such a scale as would be proper had the interests of the infant been the determining factor, but primarily for the convenience of the applicant, I think that the only amount which the Court should allow in respect of the past maintenance of the infant is the amount by which the expenditure has been increased or incurred by reason of the necessity of making suitable provision for the maintenance of the infant; although, when determining such amount, the Court will not require the applicant to support his or her claim by voucher. Applying that principle to the determination of the present claim, I propose to allow every item of expense which either applicant swears was actually incurred for or on account of the child; but as to so much of the claims as rests on estimates of the additional expense incurred by reason of the child being an additional inmate of the household, I propose to scrutinise the claim somewhat closely…
I have mentioned above that Countess of Bective and Clay v Clay are not direct authority for the proposition that Anne was entitled to spend Tanya's interest in Russell's estate for the benefit of the family generally, and without keeping accounts and vouchers.
However, as Dixon J stated in Countess of Bective, in Brown v Smith Jessel MR "describes conditions which may be contemplated by an order of the Court, and they are material also to the meaning and operation of other instruments providing for maintenance".
In Brown v Smith, the Master of the Rolls said [182] : The question I have to consider is, whether a fair allowance was made to the mother under all the circumstances, and whether the child was fairly and properly maintained and educated. It is not the practice of the Court when it allows these moderate sums of £100 or £200 a year to a parent or relative to enquire too minutely into the mode in which the sum is expended. It is supposed that the person who takes that child into his or her house does not keep separate accounts of every item of rent and taxes, of every bit of furniture bought for the use of the infant, or bought for the use of other people, and of the number of rides in the carriage the infant takes as compared with the other members of the household. That is not the meaning of it. What the Court does is to allow a fair sum for the maintenance and education of the infant, and to see that the infant is fairly maintained and educated having regard to the sum allowed. The Court frequently allows a larger sum than is actually required for the maintenance of the infant on purpose… In all these matters we look to the infant's benefit… … I think it is wrong to reckon up the number of shillings or the number of pounds exactly that the infant costs. You must look at the whole circumstances together and say whether the allowance made was not a fair allowance for….
Brown v Smith was a case in which the Court retrospectively approved a trustee applying the income of a trust fund to which a minor was entitled for the maintenance of the minor, by paying the income to the mother and stepfather. That was in circumstances where the income had been used to maintain the whole of the household, to the benefit of the minor, and not solely for the minor's direct maintenance, and also in circumstances where the mother and the stepfather had not kept strict accounts or vouchers.
I consider that these authorities, taken as a whole, so far as they are relevant to the present issue justify the following propositions of law: 1. Where the needs of a minor entitled to a trust fund require it, the Court in its parens patriae jurisdiction has power to make orders authorising the trustee to apply the income for the maintenance, education and advancement of the minor. 2. At least where the entitlement of the minor to the capital of the trust fund is vested and not contingent, the Court can authorise the trustee to break into the capital for the same purpose. 3. As a matter of principle, the Court's power to authorise a trustee to apply the income or capital of the trust for the maintenance, education and advancement of a minor beneficiary should extend to authorising the trustee to use the assets in the trust fund for the benefit of, and in the best interests, of the minor. This power would extend to authorising the trustee to allow real property to be used as a home for the minor during its minority. 4. The Court may make orders of this type whether or not there is a trust instrument that contains a power in the trustee to apply the trust fund for the maintenance of the minor out of income or advancements out of capital. 5. The Court acts on the guiding principle of what is in the best interests of the minor. 6. The Court will more readily authorise the application of income than breaking into the capital, but there is no bar on the latter when that is in the best interests of the minor. 7. The Court may, in an appropriate case, make an order authorising the expenditure of income or breaking into the capital retrospectively after the funds have been expended, provided that the Court is satisfied that the expenditure was proper and in the best interests of the minor. 8. The Court may make orders authorising expenditure in circumstances where the funds to which the minor is entitled may be expended not only directly on the maintenance, education and advancement of the minor, but also for the benefit of the whole household in which the minor will live if that is in the minor's best interests. 9. The order may also be made where the persons who have already spent, or will spend, the money have not kept, or could not be expected to keep, strict accounts and records to justify and explain how they have expended the funds.
The proper forum for determining whether Anne should be given retrospective authority to expend Tanya's share of the proceeds of sale of the Pony Paddocks on the improvement and maintenance of the Fernmount land and for the benefit of Tanya and the family generally is in the conduct of an account of Anne's administration of Russell's estate. For the reasons canvassed above, there are strong reasons on the evidence for concluding that Anne ought to be given that authority. That is particularly so having regard to the family's financial needs and the relatively small amount of the money involved. However, strictly this is not an issue to be decided in these proceedings, and if the Court dismisses Tanya's claim for equitable compensation in respect of the use of the Pony Paddocks receipts, and does not order that an account take place, the need to decide whether Anne should be given retrospective authority will not arise.
It appears that Tanya has proceeded upon the basis that Anne would not be entitled to claim allowances in the accounting process, if the Court makes an order that Anne account to Tanya in respect of her actions as administrator and trustee of Tanya's share in Russell's estate. As mentioned, Tanya has, in her submissions, claimed an order that she be paid her share of the funds in the estate plus interest calculated on a compound basis. She has claimed that Anne should be obliged to account as if she had from the grant of the letters of administration applied Tanya's share in the estate for optimal commercial advantage and retained the fund to give it to Tanya. Tanya has not volunteered allowances for Tanya's maintenance, education and advancement, or Anne's efforts and expenditures in improving the value of Russell's estate. If Tanya has proceeded on that basis, it is in my view a misconception.

[28]

Application of statutory limitation periods

I will return to a consideration of whether the Court should make an order against Anne that she account to Tanya in respect of the administration of Russell's estate during Tanya's minority below. I will first consider the issue of whether Tanya's claim for equitable compensation in respect of Anne's expenditure of Tanya's share in the proceeds of sale of the Pony Paddocks, assuming that money formed part of Russell's estate, is statute barred.
Tanya submitted [183] that the provision that governs the limitation period in respect of her claim for her share in the proceeds of sale of the Pony Paddocks is s 47(1)(c) and (e) of the Limitation Act.
Section 47 of the Limitation Act relevantly provides: (1) An action on a cause of action: (a) in respect of fraud or a fraudulent breach of trust, against a person who is, while a trustee, a party or privy to the fraud or the breach of trust or against the person's successor, (b) for a remedy of the conversion to a person's own use of trust property received by the person while a trustee, against that person or against the person's successor, (c) to recover trust property, or property into which trust property can be traced, against a trustee or against any other person, or (d) to recover money on account of a wrongful distribution of trust property, against the person to whom the property is distributed or against the person's successor, is not maintainable by a trustee of the trust or by a beneficiary under the trust or by a person claiming through a beneficiary under the trust if brought after the expiration of the only or later to expire of such of the following limitation periods as are applicable: (e) a limitation period of twelve years running from the date on which the plaintiff or a person through whom the plaintiff claims first discovers or may with reasonable diligence discover the facts giving rise to the cause of action and that the cause of action has accrued, and (f) the limitation period for the cause of action fixed by or under any provision of this Act other than this section. (2) Except in the case of fraud or a fraudulent breach of trust, and except so far as concerns income converted by a trustee to his or her own use or income retained and still held by the trustee or his or her successor at the time when the action is brought, this section does not apply to an action on a cause of action to recover arrears of income.
Tanya did not plead a claim of fraud or fraudulent breach of trust against Anne. Although Tanya claimed in her evidence that Anne applied the proceeds of sale of the Pony Paddocks to purchase a bedroom suite for herself and in running two race horses, I have rejected that claim. I have accepted Anne's evidence that she applied the funds in improvements to the Fernmount land and for the benefit of her family. Consequently, I do not accept that Anne converted the fund to her own use.
Tanya submitted that her claim was to "recover trust property" within s 47(1)(c).
Tanya also submitted, in respect of the application of s 47(1)(e), that she had no way of knowing that the proceeds of sale of the Pony Paddocks may have formed part of Russell's estate, until she read the transcript of earlier family provision proceedings involving members of the family, on 30 October 2015, and subsequently read affidavits on 10 March 2016, which disclosed this possibility. Consequently, Tanya submitted, the relevant limitation period expired 12 years after Tanya first discovered that she had a cause of action in relation to the proceeds of sale of the Pony Paddocks that were received by Anne.
Tanya's submission that s 47 is the applicable statutory provision assumes that her claim is to "recover trust property, or property into which trust property can be traced". However, the proceeds of sale of the Pony Paddocks received by Anne have wholly been expended, and there is no property, other than the Fernmount land itself, into which those proceeds can be traced.
Tanya's claim against Anne, except to the extent that it may be an adjunct of any accounting given by Anne, is a claim for equitable compensation for breach of trust.
In my view, the applicable statutory provision is s 48 of the Limitation Act, which provides: An action on a cause of action in respect of a breach of trust is not maintainable if brought after the expiration of the only or later to expire of such of the following periods of limitation as are applicable: (a) a limitation period of six years running from the date on which the cause of action first accrues to the plaintiff or to a person through whom the plaintiff claims, and (b) the limitation period for the cause of action fixed by or under any provision of this Act other than this section.
Section 34(2)(b) of the Interpretation Act 1987 (NSW) entitles the Court, in the interpretation of the provisions of the Limitation Act, to consider a report of the Law Reform Commission that was laid before either House of Parliament before the provision was enacted or made. The Report of the Law Reform Commission on the Limitation of Actions (LRC 3) stated in par 230: The cases where, under the present law, there is as a rule no period of limitation, that is, the cases of fraud and so on mentioned in the proviso to section 69 (1) of the Trustee Act, are covered by section 47(1)(a),(b),(c) [of the draft Limitation Act contained in the Report].
The proviso to the, now repealed, s 69(1) of the Trustee Act 1925 (NSW) was in the following terms: Provided that this section shall not affect any action suit or other proceeding where the claim is founded upon any fraud or fraudulent breach of trust to which the trustee was party or privy, or is to recover trust property, or the proceeds thereof still retained by the trustee, or previously received by the trustee and converted to his use.
Relevantly, this shows that s 47 of the Limitation Act was directed to the recovery of trust property, or the proceeds thereof still retained by the trustee.
In respect of s 48 of the Limitation Act, the Report of the Law Reform Commission said, in par 237: … Section 48(a) will cover cases where the trustee is liable to make good out of his own assets losses arising through breaches of trust which are not fraudulent.
Consequently, as a general matter, the limitation period for an action to recover equitable compensation for the expenditure of Tanya's share of the proceeds of sale of the Pony Paddocks was six years running from the date upon which the breach of trust first occurred. The running of the limitation period is not dependent upon when Tanya first discovered, or may with reasonable diligence have discovered, the facts giving rise to the cause of action.
However, as Tanya was a minor when the alleged breaches of trust occurred, s 52(1) of the Limitation Act has the effect that the limitation period commenced to run three years after Tanya achieved her majority. Accordingly, the limitation period has expired.
I note in this context that Tanya relied upon s 47 of the Limitation Act, together with the fact of her reliance upon the Fernmount land representations, in seeking to defend the defendants' original claim that Tanya's claim to be entitled to a beneficial interest in the proceeds of sale of the Fernmount land was now statute barred. I accept that, as the proceeds of sale of the Fernmount land are still retained by Anne, s 47 of the Limitation Act would have been the applicable statutory provision. However, as already noted, the defendants have conceded that Tanya is still entitled to her beneficial share of the proceeds of sale of the Fernmount land. It is no longer necessary to consider the application of s 47 in this context, or whether the running of this limitation period was affected by Tanya's reliance upon the Fernmount land representations.
It remains necessary for the Court to consider Tanya's submission that Anne cannot rely upon the statutory limitation period in relation to her expenditure of the proceeds of sale of the Pony Paddocks because of Tanya's reliance on the Fernmount Land representations. Tanya's failure to commence proceedings against Anne within the limitation period created by s 48 and s 52(1) of the Limitation Act was affected by Tanya's participation in the family deal and cannot be separated from a consideration of the consequences of the family deal. Consequently, I will defer a consideration of this issue until after I have dealt with the effect of the family deal, which is a matter relevant to the period after Tanya achieved her majority.

[29]

Entitlement of Tanya to an order that Anne give an account to Tanya

I now turn to the question of whether the Court should, in the present circumstances, order that Anne give an account to Tanya in respect of her administration of Russell's estate during Tanya's minority.
Tanya's submissions do not appear to be specific on the issue of whether Tanya seeks an order that Anne account to her under s 85 of the Wills Act, as in effect at the date of Russell's death, or under the general jurisdiction of equity to order a trustee to account, or both. The fact that the former basis for requiring an administrator and trustee to pass accounts is statutory has consequences for the application of limitation periods and the equitable doctrine of laches.
As Tanya has sought an order under UCPR r 54.3(3) that Anne be directed to furnish accounts and to verify her accounts, I will assume that Tanya bases her claim on both sources of her entitlement to apply for an accounting from Anne.
The relevant principles have been comprehensively explained by Ward J (as her Honour then was) in Hons v Hons [184] . Her Honour's judgment has been followed by Pembroke J in McEvoy v McEvoy (No 2) [185] , by Jenkins J in Davis v Davis [186] , and by Gleeson JA in Singh v Singh [187] . So, respectfully, will I.
Ward J explained the process of the taking of accounts on a common or wilful default basis as follows: [104] It is necessary, when considering a number of the discretionary factors which have been raised, to bear in mind what is comprised by such a process, since that enables an assessment to be made not only of how onerous an order for the filing of statutory accounts would be in this case but also the utility of such an order. [105] The accounting principles carried out under the statutory processes of the probate court are the same as with other accounts (Northey v Juul [2005] NSWSC 933, at [18] and see On Equity, at [16.1320]). Although accounts are ordinarily taken on the basis of actual figures, notional figures may be taken into account where accounts are ordered on the basis of wilful default. (In Garcia v Delfino [2003] NSWSC 1001, at [33], this was described as a situation where "the central concept is one of loss or potential loss through inactivity, inattention or failure to face up to responsibilities".) The authors of On Equity note (at [16.1330]) that wilful default in this context does not connote actual dishonesty but that passive negligence "where the trustee understood the obligations but failed to comply with them" will suffice, citing McLauchlan v Prince [2001] WASC 43, at [16] and [14]; Bartlett v Barclays Trust Co Ltd (Nos 1 and 2) [1980] Ch 515, at 546. The authors note that on the wilful default basis the objective is to ascertain what the accounting party should have received or paid had there been no wilful default (MLW Investments Pty Ltd v Tacsum [2006] NSWSC 1256, at [33]). [106] In McLauchlan v Prince an action for account on the basis of wilful default was distinguished from common account by Sanderson M (at [12]): Generally speaking a common account is a procedure to ascertain the monetary dealings of the parties in respect of the subject property and to determine with precision the balance due between them. After the balance is ascertained orders are made as to the rights of the parties to that balance. Thus a common account generally involves a two-step process. But an account on the basis of wilful default involves ascertaining the status of the corpus, determining the extent to which it has been depleted, ascertaining what would have been earned had the estate been properly administered and ordering payment to the plaintiff of that amount. This whole process is wrapped up in the one procedure. [107] An order for taking accounts on the basis of wilful default is thus more onerous on the accounting party than an accounting in common form. [108] In Glazier v Australian Men's Health (No 2) [2001] NSWSC 6, Austin J (though there dealing not with the process for the taking of statutory accounts under s 85 but with accounts ordered to be taken in equity) set out the general principles which the court should follow when making an order for an account for administration and noted that when an order is made in equity for the taking of accounts the usual form of order is an order in common form or for common accounts. Such an order requires the defendant to account only for what he or she has actually received, and his or her disbursement and distribution of the amounts so received. His Honour noted that the defendant prepares accounts and that it is open to the other parties to surcharge or falsify items in those accounts; (a surcharge being the showing of an omission for which credit ought to have been given, and a falsification being the showing of a charge which has been wrongly inserted, the falsifying party alleging that money shown in the account as paid was either not paid or improperly paid, referring to Parker's Practice in Equity (New South Wales), 2nd edn, 1949, by GP Stuckey and CD Irwin, at 269) (at [38]). His Honour referred to Pt 48 r 6 of the Supreme Court Rules which preserves these procedures for challenging the account (at [38]). [109] The distinction between an order for accounts in common form and an order on the basis of wilful default was noted by his Honour as follows (at [44]): [44] The contrast between an order for an account of profits and an order for an account of administration in common form is obvious. The former provides a remedy for specific wrongdoing, while the latter "supposes no misconduct" (Partington v Reynolds at 256 (ER at 99)). [110] I note the differences in procedure by way of highlighting the alternative courses of action which the plaintiffs might have had in seeking to challenge the manner in which Alexander has conducted the administration. However, insofar as what they have sought is simply an order compelling the filing of statutory accounts (and not, for example, an order for the taking of accounts in equity on a wilful default basis) as I understand it the process to be carried out in the probate registry would be in essence an administrative one of verifying the accounts as filed (with whatever requisitions may be considered appropriate). I note, however, that it is likely that the accounts would need to be verified in order to comply with the practice of the probate registrar (in Mason & Handler on Succession Law & Practice, (at [1437.1]) it is said that, while not obligatory for accounts themselves to be verified in estates of persons dying before 31 December 1981, it is the current practice of the Registrar to require verification). Hence at the very least some form of dispensation from that strict requirement would be needed to take into account the present circumstances.
The effect of her Honour's observation in [110] is that, in that case, the plaintiffs apparently sought an order that accounts be passed under s 85 of the Wills Act.
As Ward J explained in Hons v Hons, the effect of s 85 of the Wills Act, as in force at the date of Russell's death, was that Anne was placed under a statutory obligation, by the grant to her of letters of administration of Russell's estate, to file and pass Anne's accounts relating to the estate "within such time, and from time to time, and in such manner as may be fixed by the rules or as the Court may order". The use of the imperative "shall" in s 85 had the effect that Anne had a statutory obligation to file and pass her accounts.
Her Honour found: [88] It does not seem to me that there is any doubt that Alexander, as an administrator, remains under an obligation under s 85(1) of the Act to file an inventory of the estate of the deceased and to file, or file and pass, accounts in relation to the administration of the estate of the deceased but it is open to me to determine the time and manner within which such an obligation is to be performed. While there is not, in the Rules or in the Act, an express provision allowing for the dispensation of relief from such an obligation, the effect of an order (of the kind which is clearly contemplated under the rules) extending the time for filing of the accounts until further order would in practical terms be to dispense with any immediate obligation to do so. There is also clearly a discretion as to the manner in which any order for accounts should be made, which would have to take into account the evidence as to what is likely now to be possible after the lapse of time since completion of the administration. [89] Whether or not there is a power formally (if not as a matter of practicality in terms of the timing of such an order) to dispense with the filing of the statutory accounts, does not affect the court's discretion whether to grant any relief at all on the present application. Here, what is sought is an order compelling performance of a statutory obligation. There is no doubt that there is such an obligation. However, the question is whether that obligation should be the subject of an order by the court of the kind sought (or the administrator should simply be left in the position that without accounts having been passed and filed there is no release in respect of the estate accounts and no basis on which commission can be claimed). I consider below whether such a discretion would appropriately be exercised in this case.
I accept Ward J's conclusion [188] that the equitable defences of laches and acquiescence are not available as a defence to a legal claim based upon the operation of s 85 of the Wills Act. As Ward J said: [100] Having regard to the above, it seems to me that it is not open to Alexander to raise equitable defences such as laches and acquiescence to defeat the existence of a statutory liability to account on an application by the plaintiffs seeking the aid of equity to enforce such a statutory obligation, even though that obligation is broadly similar to rights and obligations otherwise enforceable in equity such as the obligation of a trustee to account. That said, insofar as there is a discretion to determine whether, and if so, what relief should be granted the factors which give rise to the claimed defence of delay and acquiescence should be taken into account. I consider this further in answer to Issue 3 below.
Her Honour set her reasons out [189] as to why the Court nonetheless has a discretion as to whether or not to order the taking of a formal account, and, if so, the form in which the account should be taken. Ward J expressed the following conclusions concerning the relevance of delay in making an application for the taking of an account: [116] In Pearse v Green (1819) 1 Jac & W 135, at 140; 37 ER 327, Master of the Rolls, Sir Thomas Plummer, stated: It is the first duty of an accounting party, whether an agent, a trustee, a receiver, or an executor, for in this respect, as was remarked by the Lord Chancellor in Lord Hardwicke v Vernon (14 Ves. 500). And see White v Lincoln, 8 Ves. 363) they all stand in the same situation, to be constantly ready with his accounts. [117] Delay, of itself, is not something which would necessarily preclude an order for accounts in equity (or by analogy for the filing of statements of accounts) being granted. From Lord Chedworth v Edwards (1802) 8 Ves Jun 46; 32 ER 68 (there in the case of a principal/agency relationship) it can be seen that the failure to ask for an account, even over a long period, does not diminish the duty to keep proper accounts. Moreover, it is clear that an account may be ordered even though the only breach may be of the duty to provide an account (Meagher JA, at [8] in Asset Risk Management Ltd v Hyndes [1999] NSWCA 201, referring to Baker P. & Langan P., Snell's Principles of Equity, 28th edn, Steven & Hayes, 1982). [118] Nevertheless, where to order accounts to be taken (even where there is a clear duty to account) would be likely to be an exercise in futility at a disproportionate cost to any potential benefit resulting therefrom, the fact of delay in seeking an account seems to me to be an added factor tending against the exercise of the discretion to order such relief. [119] In exercising my discretion as to whether now to order accounts to be filed (and/or as to the manner in which those accounts should be filed), I think it is significant that the plaintiffs have delayed for some considerable time in articulating their complaints in a formal manner (as per the letter of complaint in 2003) and have delayed even longer in taking action to enforce the obligation for the verification of accounts. It is said that the plaintiffs did not act at an earlier time than 2003 out of respect for their mother's wishes. That may well be the case. However, the consequence of no steps having been taken at an earlier stage to demand or compel the production of accounts is that Alexander was not put on notice until at least 2003 of the need to prepare or retain records in relation to the administration. In 1988, he considered the administration to be finalised. I accept the evidence of Alexander that he does not now have the records necessary in order to comply with what he has been advised would now be required for the filing of accounts in accordance with the rules of court. The incorrect advice given to him by his solicitor has exacerbated the position as Alexander was not made aware of the need to retain professional advisers as necessary in relation to the preparation of formal accounts.
Finally, [190] , Ward J considered the significance of the fact, in the case before her, that the administrator had mistakenly failed to maintain and keep the records necessary to enable a formal account to take place, by reliance upon incorrect legal advice. She held that it was a matter relevant to the exercise of the Court's discretion as to whether an order should be made for a formal account to occur.
In the present case, Anne was not given incorrect advice that she was not required to maintain accounts and to retain vouchers. But because she was given potentially incorrect legal advice that she was entitled to expend the children's interests in Russell's estate for their maintenance, education and advancement, she would have had no reason to think that she needed to maintain accounts or retain vouchers in the first place.
The result is that, in the exercise of my discretion, I would decline to make the orders sought by Tanya that Anne account to Tanya on a wilful default, or any other basis, in respect of the administration of Russell's estate, including as to the use of the Fernmount land, and also the expenditure of the proceeds of sale of the Pony Paddocks.
Although the issue was not addressed in detail in the evidence, it is implicit and almost certain that Anne did not maintain contemporaneous accounts, she did not retain vouchers, and it is now much too late for any person's recollection of events to provide an adequate substitute for documentary records.
Further, if a formal account were ordered to be given, Anne would, in principle, be entitled to claim the allowances that I have considered above in relation to her use and application of Russell's estate, and the interests of the children in that estate, for the benefit of the individual children and for the family collectively. At this remove in time, the evidence in support of the application for allowances could only be given on the most general and fallible basis.
It is also relevant to the exercise of my discretion in the proposed manner that I have not accepted Tanya's claim concerning the manner in which Anne expended the proceeds of sale of the Pony Paddocks, and no claim has been made that Anne administered Russell's estate, during the minority of her children, in a manner that was other than selflessly in their interests and for their benefit.
Finally, I do not consider that the subsistence of the family deal during the period of the children's majority in any way preserves the right of Tanya now to insist upon Anne giving a formal account of her administration of Russell's estate during Tanya's minority. On the contrary, on the basis that a term of the family deal entitled Anne to believe that Tanya would be totally satisfied by receiving a gift of one third of Anne's estate upon her death, Anne was entitled to put out of mind and forget all of the details that may have been relevant to providing an account to Tanya for the period of Tanya's minority.
In my view, Tanya's participation in the family deal is now entirely inconsistent with Tanya being entitled to expect Anne to formally account to her in respect of the events that occurred during Tanya's minority, let alone that she be required to verify the accounts or provide vouchers. My reasons for forming this view will become more apparent after I have considered the nature and consequences of the family deal below in relation to events that have taken place after Tanya achieved her majority.
Tanya's claim that Anne be ordered to formally account to her on a wilful default basis assumes the correctness of Tanya's submission that Anne was required to administer the trust of Tanya's share in Russell's state on a commercial basis that was directed at maintaining the capital and accumulating as much income as possible. It follows from the conclusions that I have expressed above that I do not think that Anne was required, in the particular circumstances of this case, to deal with Tanya's share in the estate on that basis. However, if my conclusion were wrong, it is clear that Anne did not administer the trust on a basis that retained all of the capital and optimised the financial return of the trust, by dealing with the assets in a commercial way. Consequently, if Tanya were entitled to an account by Anne on the basis she claims, it would be proper for the accounting to take place on a wilful default basis. That conclusion follows from the clear manner in which Anne in fact administered the trust during the minority of her children.

[30]

Administration of estate during Tanya's majority

I now turn to Tanya's claim for maladministration of Russell's estate by Anne from the time Tanya attained her majority on 14 May 1988. That is a period of some 33 years.
In principle, this period may be divided into two sub-periods. The first is between 14 May 1988 and 9 November 2015, when Tanya served her demand on Anne. During this period, Anne's obligations as administrator and trustee of Russell's estate may have been influenced by the existence of the family deal. From 9 November 2015 to the present time, the obligations of Anne and the other defendants may have changed because Tanya had abrogated the family deal.
During the first part of this period, Tanya was an adult and responsible for her own actions. Statutory limitation periods that would otherwise have expired during Tanya's minority expired on 14 May 1991: see Limitation Act s 52(1). Otherwise, statutory limitation periods commenced to run from the date relevant causes of action accrued to Tanya after 14 May 1988.
As the particulars of the breach of trust provided by Tanya [191] show, many of the alleged breaches were of a description that may have begun during Tanya's minority, and continued thereafter. Moreover, many of the alleged breaches described were of a repetitive or continuing nature, so that causes of action in relation to those breaches may have accrued both before and after Tanya achieved her majority.
Consequently, some of the issues considered above in relation to Tanya's present entitlement to maintain claims against Anne and the other defendants, or for an order against Anne that she account to Tanya, will apply during the period of Tanya's minority and the period now under consideration. The strength of those considerations may attenuate as relevant events occurred closer to the present day. Practical issues of proof may become less onerous the more recent the relevant events.
Two specific differences between the later and the earlier periods that must be considered are: first, the significance of the family deal; and secondly, the claims made by Tanya for credit for the contributions to Russell's estate that she made while an adult, as well as the defendants' corresponding claims for credit for their contributions.
Also, of possible relevance is that the statement of claim was filed by Tanya on 10 November 2016. Causes of action with six-year limitation periods arising after 10 November 2010 would not, in principle, be statute barred. However, the effect of the family deal continued until at least 9 November 2015, and perhaps thereafter, as a result of the possibility that the defendants may not reasonably have been able to respond to Tanya's abrogation of the family deal immediately.

[32]

Cross-examination of Tanya concerning the family deal

I consider that Tanya, in her cross-examination, substantially accepted the existence of the family deal as alleged by the defendants, save for the question as to whether there had to be agreement, and not just discussion, as to how the Fernmount land could be used for the benefit of individual members of the Perry family. As set out below, I find that the family deal contained implied conventions that extended beyond the terms specified by the defendants in their submissions. Tanya was cross-examined as follows: [195] Q. I'll just come to that then. The family deal - and I know that's a loose expression - what was the family deal? A. The family deal was made with us from when we were children, and my earliest memories of Anne talking to us about the future was when I was about ten, I would say, and it was that she wanted to stay on the farm until she died, and that she would leave it equally in her will, split between the three of us, and that over the years, she would also add that any of the financial decisions or major decisions to do with the property and any real decisions to do with the property, we would all discuss. And as a family, we would decide that, and that was reinforced to me on multiple occasions. Q. Do you agree that if she may have had to pay rent, it might have impacted on her decision to stay at the property? A. She was our mother. We weren't looking at her to pay rent. Q. And after you turned 18, that continued, didn't it? A. That's right. Q. It continued all the way up to late 2015. A. That's correct. Q. In relation to Mark and Michelle, you've known since 2003 that they were grazing on the property? A. They were grazing on the property before 2003, but yes. Q. When did you first know that they were grazing on the property? A. Mark had run cattle there on and off since he was ten. Q. And you never objected to that? A. No. Q. And you never objected, can I say, to him running more cattle on the property as he got older? A. No, I did not object. Q. You knew that Mark and Michelle were paying almost all of the outgoings on the property? A. I didn't know the specifics beyond the rates, the water rates, and the insurance and the mowing. Q. But if there were any expenses associated with the running of that property, you knew that you weren't paying them? A. I believed Anne was paying. Q. And did you believe that Mark and Michelle were also paying? A. I wasn't aware of the detail of that. Q. You were aware from an early stage that Mark was using his own machinery on the property? A. We did have a tractor on the property. I've never witnessed him bringing his machinery onto the property. I would assume so, but I don't know. Q. And if he did, you would assume that it would be at his cost? A. Yes. Q. You were aware from an early stage that Mark and Michelle were renovating the cottage, or A. Yes. Q. Do you accept that their improvements and renovations added value to the property? A. The renovations they did were minor renovations. They painted the place, they got a second hand kitchen and they made it - put some blinds in and, I think, Anne and Mark did some tiling in the bathroom. It wasn't a major renovation, but they made it liveable. Q. How does it compare to the renovations that you say you contributed to for which you seek some form of recognition here? More, you did more, or they did more in relation to renovating the cottage, for example? A. I contributed some money towards painting is what I - that went towards paint. So the inside and outside were - were painted. Q. And the evidence of your contributions is set out in your affidavit, isn't it? A. That's correct. I mean, yes. Q. You've never suggested up until these proceedings that Mark and Michelle pay some agistment fee for cattle on the property? A. Can you repeat the question? Q. You've never suggested up until these proceedings that Mark and Michelle should pay some agistment fee for using the premises? A. I believed it was a fair deal that they were paying the outgoings and they were having their cattle as part of their business on the property. Q. But if, say, it's not a fair deal. If, say, for example, they were not making a profit as a result of the herd they were running on the Fernmount and the cost in maintaining the Fernmount property and doing what they were doing greatly exceeded their return, do you think they should be acknowledged for that? A. No, they shouldn't. If they didn't believe they were getting a fair deal, then they should have brought it to the attention of the family and there should have been a meeting about it, and we should have discussed it and agreed what was considered fair.
Earlier, the following cross-examination of Tanya had taken place: [196] Q. Ms Perry, as I say, if you don't understand the question, please say so. Are you suggesting that your mother should have herself run cattle on this property as a commercial enterprise? A. She did run cattle on the property as a commercial enterprise. Q. Do you say she should have run it at full capacity or at a hobby level? A. The farm was a money producing farm. Q. And it produced money for you, too, didn't it? A. It produced money for the whole family.
Further (repeating for convenience an extract from the transcript that is already set out above at [200]): [197] Q. So you knew as a child but you certainly knew as at the age of 18, that you had an entitlement to a share in the property? A. I did. Q. But you did nothing about asserting that entitlement until you commenced these proceedings? A. Because of the family deal. Q. But there was nothing that was there - you weren't encouraged not to make further inquiries about anything, were you? A. This was a deal that had a lifespan of my mother's life. Q. Well, you - you mean, your life? A. No, my mother's life. Q. I'm sorry, I don't understand what you mean. A. The deal was that she could live on the property until she died. Q. Right but you could have asserted your interest at any stage, at least on becoming on 18? A. That was something that just - you couldn't do. Q. Well, you were under no disability, were you? A. To throw my mother off the property and claim my right at that time was something that couldn't be done. Q. But you were under no disability? A. No.
Finally: [198] Q. Ms Perry, I'll just come back a moment, if that's okay - you could have obtained legal advice any time from the age of 18? A. As Ann, herself, has placed in her affidavits, it wasn't the family thing to do - is to go get legal advice and take action around our rights and the agreement. It's - I don't know how to put it into words but it - it would have been seen as a complete betrayal of the family had I done so. It would have removed me from the family as it has done so when I did challenge in October 2015. Q. Ms Perry, the answer to my question, I think, is you could have obtained legal advice, the answer is "yes"? A. Yes, I could have. Q. You chose not to obtain the legal advice? A. Because of the deal. Q. But no one said to you - no one stopped you from obtaining legal advice in relation to your interest? A. It was unspoken that had I, I would have been rejected from the family.
I find that the family deal was substantially in the terms submitted by the defendants, save to the extent that I have found that the family deal included the elaborations considered below.
The following statement of the elements of the family deal can be no more than a broad distillation of factors that emerged from the evidence, as being generally agreed components of the family deal: 1. Anne would be permitted to live on the Fernmount land for the balance of her life. 2. Anne would not be expected to pay rent to the children in respect of her use of their shares in the beneficial ownership of the Fernmount land. 3. Anne could from time to time use the Fernmount land to raise income for herself without being required to account to the children for their beneficial shares in the Fernmount land. 4. Anne could permit one or other of the children to live on the Fernmount land from time to time without requiring them to pay rent accountable to Russell's estate. 5. Anne could, if she so wished, agree to the children occupying the Fernmount land to improve and maintain the land for no payment in recompense for their occupation. 6. Anne could permit the children to use the Fernmount land for commercial purposes for no fee in return for the children who used the land maintaining and improving it. 7. Anne could place the Fernmount land under a credit risk by using it to support guarantees of loans made by the children. According to Tanya, this aspect of the family deal was only by agreement of all family members. The defendants contended that this was within the discretion of Anne after discussion between members of the family. 8. It was implied in the above aspects of the family deal that Anne was not required, as administrator of Russell's estate, to apply the Fernmount land for the financial benefit of the beneficiaries of the estate in any manner that was inconsistent with the operation of the family deal. 9. It was a further implication of the family deal that Anne would not be required to keep the formal accounts and vouchers that would ordinarily be required to be maintained by the administrator of a deceased estate during the course of the administration. The keeping of formal accounts and the retention of vouchers would have been superfluous given that the essence of the family deal was that the Fernmount land would not be used in the manner required of an administrator in the absence of the existence of the family deal. 10. The final aspect of the family deal was that Anne would leave a will in which she left her whole estate, being primarily the Fernmount land, to the three children equally. 11. There is a question as to whether there is an implication in the family deal that Anne acknowledged that each of the children had a two ninths beneficial interest in the whole of the Fernmount land, and not just the unimproved value of that land. This issue arises out of the fact that an incident of the family deal was that Anne was, for her lifetime, entitled to use the Fernmount land for her own benefit, or for the benefit of the children as she may agree, without payment of rent, or the maximisation of the returns to the beneficiaries from the use of the Fernmount land, and without being required to keep accounts and vouchers in respect of the administration. To the extent that, in a de facto manner, aspects of the family deal existed throughout the minority of the children, Anne did not keep accounts or vouchers in respect of the administration of Russell's estate, or her personal contributions as administrator to the improvement of the value of the estate. The absence of accounts and vouchers may have the practical effect, when taken with the other aspects of the family deal, that Anne deprived herself of the capacity to establish any allowances in her favour, from her own contributions, in any accounting that may take place concerning the conduct of the administration. 12. It is arguable that the arrangements that the parties made from time to time concerning the joint venture in respect of the eco-tourism lodge should be regarded as an aspect of the family deal. However, given the complexities of that arrangement, it will be more convenient to deal with it as a separate family deal.
There are two additional aspects of the family deal in respect of which the arrangements were even more indefinite than some that I have considered above.
The first related to the duration of the family deal, and whether it could be countermanded by any member of the family at will, or on notice. It is not necessary to make a definitive finding on this issue, because Anne did not contend that, as a result of the family deal, and her reliance upon it, she has a right to live on the Fernmount land for life. As mentioned, Anne has sold the Fernmount land. Anne has not made any claim for compensation. Furthermore, Mark and Michelle have caused the mortgage over the Fernmount land that secured Anne's guarantee of their debts to be discharged. Although that has occurred, the defendants resisted Tanya's demand for some time, and the discharge only took place during the course of the hearing.
The defendants have therefore implicitly accepted that the family deal could be terminated by a member of the family. If it becomes important, it will only be necessary to consider whether notice had to be given, and whether issues of reliance and estoppel might govern the timing and circumstances in which parties who had relied on the family deal would have to revert, to the extent possible, to the strict legal relationship between the parties.
The second uncertain aspect of the family deal is the extent to which, as claimed by Tanya, it had the implied effect of stopping time running against family members, in respect of their rights to seek legal remedies to enforce their strict legal entitlements. In my view, it was necessarily implied into the family deal that, so long as it was in effect, no member of the family would lose their right to enforce their legal entitlements to a share in the capital of Russell's estate, if the family deal was terminated during Anne's lifetime. No party contended that the family deal created rights that permanently replaced the parties' strict legal rights to shares in the capital of Russell's estate. Logically, it must have been implicitly understood by the family that, if the family deal was terminated, individual family members could act to enforce their legal rights, save to the extent that earlier reliance by others on the existence of the family deal made strict enforcement of rights inequitable.
I accept the validity of the defendants' reliance on the legal significance of the family deal, as stated in the following extract of Dal Pont and Mackie [199] (citations omitted): A beneficiary of an estate who instigates, consents or concurs in a personal representative's breach of duty vis-a-vis the estate cannot succeed in an action based upon that breach. The law in this context parallels trust law. For this purpose, it has been judicially observed that "executors are in the position of trustees, and it cannot be doubted that, if a [beneficiary] not under a disability sanctions a departure from the strict line of duty prescribed by the conditions of the trust, he cannot afterwards be heard to complain of that behaviour, or treat it as a breach of trust". An effective consent requires not only that the beneficiary have capacity; it also presupposes full knowledge of all relevant facts and the consequences of consenting or concurring. The same consequences ensue where a beneficiary acquiesces in the breach, whether by adopting the breach or by remaining inactive with full knowledge thereof. The principles are those applicable to trustees, as are those governing the release by a beneficiary of a personal representative's liability for a past breach of duty.
On this basis, Tanya's agreement to, and acquiescence in, the family deal following the achievement of her majority had the effect of releasing Anne from liability for failing to administer Russell's estate in a manner that commercially increased its value for the beneficiaries as well as failing to keep up-to-date accounts and vouchers to support all transactions relating to the estate.
I also accept the defendants' submission that the existence of the family deal had a legal effect going beyond the release of Anne from liability for breaches of duty, in-so-far as Anne acted in a manner authorised by the terms of the family deal. The defendants correctly submitted that the family deal operated as a convention between the members of the family as to the uses to which the Fernmount land would be put, which was intended, so long as the family deal was in effect, to supplant the strict legal rights that the family members had as beneficiaries of Russell's estate. To that extent, the existence of the convention had legal consequences extending beyond the release of one family member of potential legal liability for her conduct.
For present purposes, it is sufficient to note that the principles governing the operation of conventional estoppel are as stated by Tobias JA in Rydelar Pty Ltd v Euphoric Pty Ltd [200] , with the agreement of Mason P and Campbell JA, as follows: [194] On the other hand, estoppel by convention is a form of estoppel founded upon an assumed state of affairs by the parties whether as to a matter of fact or a matter of legal effect which both will be estopped from denying: Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226 at 244-245. That assumed state of affairs takes as a given the terms of the contract as known to and understood by the parties but from which the parties have departed for the purpose of their furtherance of their relationship under the contract. [195] As Dixon J therefore observed in Grundt v Great Boulder Pty Gold Mines Ltd (1937) 59 CLR 641 at 676, belief in the correctness of the facts or state of affairs assumed is not always necessary. Parties may adopt as the conventional basis of a transaction between them an assumption which they know to be contrary to the actual state of affairs. [196] In his recent book, Estoppel by Conduct and Election (2006) Sydney, Thomson Sweet & Maxwell, at 115 [8-001], KR Handley described estoppel by convention in the following terms: When parties make a statement of fact or of mixed fact and law the conventional basis of their transaction … both are estopped from questioning its truth for the purposes of that transaction. Estoppels by convention can be created ad hoc, expressly, by a course of dealing, or by other acts and declarations. In such a case 'there must be some mutually manifest conduct by the parties' with the intention of affecting their legal relationship. [197] In Amalgamated Investment & Property Co Ltd (In Liq) v Texas Commerce International Bank Ltd [1982] QB 84 at 121, Lord Denning MR observed: To use the phrase of Latham CJ and Dixon J in [Grundt] … the parties by their course of dealing adopted a 'conventional basis' for the governance of the relations between them … They are bound by the 'conventional basis' on which they conducted their affairs. The reason is because it would be altogether unjust to allow either party to insist on the strict interpretation of the original terms of the contract - when it would be inequitable to do so having regard to dealings which have taken place between the parties. His Lordship also observed (at 121) that: [t]here is no need to inquire whether their particular interpretation is correct or not - or whether they were mistaken or not - or whether they had in mind the original terms or not. Suffice it that they have, by the course of dealing, put their own interpretation on their contract, and cannot be allowed to go back on it. [198] The principles were restated by Lord Steyn in delivering the principal speech in The "Indian Grace" (No 2) [1998] AC 878 at 913, where his Lordship said: … an estoppel by convention may arise where parties to a transaction act on an assumed state of facts or law, the assumption being either shared … or made by one and acquiesced in by the other. The effect of an estoppel by convention is to preclude a party from denying the assumed facts or law if it would be unjust to allow him to go back on the assumption … [199] Recently the principles were restated by Brereton J in Moratic Pty Ltd v Gordon (2007) Aust Contract Reports ¶90-255 (89,904); NSW Conv R 56-172 (56,205), where his Honour observed (at 89,913 [30]; 56,215 [30]) that the doctrine of conventional estoppel precluded either party to a contract from denying an assumption which has formed the conventional basis of the relationship between them. Accordingly, it is necessary to determine whether the parties have in fact adopted such an assumption as the conventional basis of their relationship. [200] His Honour then stated the matters necessary to establish conventional estoppel (at 89,914 [32]; 56,215 [32]) as being that: (a) the plaintiff has adopted an assumption as to the terms of its legal relationship with the defendant; (b) the defendant has adopted the same assumption; (c) both parties have conducted their relationship on the basis of that mutual assumption; (d) each party knew or intended that the other act on that basis; and (e) departure from the assumption will occasion detriment to the plaintiff. [201] In noting the differences between promissory estoppel and conventional estoppel his Honour then observed with respect to the latter (at 89,914 [33]; 56,216 [33]) that it: [33] … is focussed on the consensual basis of the parties' relationship: it operates when both parties have adopted the same assumption as the basis of their relationship, often without appreciating that any departure from the strict legal position is involved, so as to hold both parties to their common understanding.
Arguably, it was available to Tanya to mount a case that, even if the subsistence of the family deal had the effect of excusing the defendants' conduct until Tanya abrogated the family deal on 9 November 2015, she became entitled to reassert her rights from that time. That case, if made, would have introduced questions of the nature and effect of the family deal, whether reasonable notice to the defendants was required in relation to the termination of particular aspects of the family deal, and whether, by reason of the reliance by the defendants on particular aspects of the family deal, the effect of those aspects was, by reason of estoppel binding Tanya, permanent.
Thus, in principle, Tanya may have been entitled to reassert her rights, after she gave reasonable notice to the defendants to readjust their positions, as if the family deal had never existed, provided in the particular case that the readjustment remained possible, and was not unreasonably onerous.
Tanya did not pursue a case to this effect. Her case was that, notwithstanding the existence of the family deal from a period from the childhood of all of the children up to at least 9 November 2015, once Tanya had abrogated the family deal, she was entitled to reassert all of her rights as a beneficiary of Russell's estate, and Anne was an arm's length trustee, with all ordinary trustee duties. Tanya did not mount a case that, even if the subsistence of the family deal superseded her rights as beneficiary while it was in existence, she was entitled to assert her rights limited to the period after the family deal was ended. These proceedings have accordingly not dealt with any of the legal and forensic issues that would have arisen if Tanya had sought to make this alternative case.

[33]

Effect of the Fernmount land representations

I have set out the Fernmount land representations as pleaded by Tanya in these reasons above [201] .
Tanya claims that, by reason of her acting upon the Fernmount land representations as she alleges were made by Anne, she did not pursue her legal rights, and, in particular, only discovered a number of significant rights as a result of her review of documents produced for the purposes of a family provision claim involving members of the Perry family that came to Tanya's attention in about 2015. Tanya claims that the effect is that she should be relieved of the running of time in respect of statutory limitation periods, and forgiven for conduct that may otherwise have been treated as laches or acquiescence, because she would have acted differently if the Fernmount land representations had not been made to her.
Specifically, Tanya submitted [202] : What effect does the making of the representations have on any statutory bar which may otherwise apply? (a) The representations were continuing representations. It is notable that Mark consistently noted his interest in the Fernmount land as one-ninth of the total both in Ellen's Estate proceedings and to Rabobank. (b) The representations induced Tanya not to further investigate her interest in the land as she understood that Anne was the "major shareholder" in the land, and that she intended to leave the property to each of the children in her will after staying on the land for her lifetime. (c) Once Tanya discovered the facts relating to her entitlement in her father's estate, and the level of the mortgage, any such consent to her mother staying on the land was withdrawn with the filing of the Amended Statement of Claim. (d) Tanya was cross-examined about whether she could have obtained legal advice as to her entitlements in relation to the property. While she agreed that she could have done so, given the representations, it is understandable that she did not.
In Tanya's first affidavit made on 27 February 2017 she said: 69. I recall being told by Anne, as a child and on more than one occasion throughout my childhood, words to the effect that (when addressing Mark, Louise and I): "I won't sell the farm. I'm going to keep it until I die and leave it to you three equally in my Will. As such, all financial decisions concerning the farm will be made with the involvement of the three of you."
Relevantly to the Fernmount land representations issue, Tanya said in her 21 August 2018 affidavit in reply: 3. I refer to paragraph 69 of my first Affidavit. In addition to the words there set out, I recall being told by Anne, as a child and on more than one occasion throughout my childhood, words to the effect (when addressing Mark, Louise and me): (a) "I had to take out a loan to buy out Ray's half share." (b) "Even though you have a share in the farm I can't put your names on title. We would have to pay stamp duty and it would affect its capital gains tax status because it was bought before the rules changed in the mid-1980's. At the moment it's capital gains tax free but that changes if there's another transaction." (c) "I had the life insurance money to help me buy the house in the village and after your father died." … 7. On Friday, 30 October 2015, on the plane to Sydney, I read the transcript of Ellen's Estate Proceedings. My husband met me at the airport and we drove to dinner in Castle Hill to celebrate our wedding anniversary. In the car on the way to dinner I told him words to the effect "I've read the transcripts [from Ellen's Estate Proceedings]. I'm in shock. Mum's always told us that she bought out Ray's share of the farm from her own money. She's given evidence she used funds from an insurance payout from a fire on the farm to buy him out. That's Dad's asset - its estate money."
Tanya also dealt with this issue in her affidavit made on 5 October 2018 in the following terms: 3. I refer to the matters pleaded at paragraph 21A of the Amended Statement of Claim and the evidence in my August Affidavit and say: a. Further to the matters set out in paragraphs 3 and 7 of my August Affidavit, Anne Perry discussed the entitlement of me and my siblings in our father's estate on a number of occasions during my childhood and after I attained my majority, in words to the effect: "Your father died without a will. The Court decided to divide his estate 1/3 to me and 2/3 to you three children. Your share of this farm is 1/3 of 2/3 of 1/2 because I took out a loan to pay your uncle Ray his half share." b. Further to the matters set out in paragraph 11 of my August Affidavit, my understanding of my entitlement in my Father's estate is set out in: i. My affidavit dated 17 October 2001 filed in the family provision proceedings 4817 of 1998 and 3246 of 2000 commenced against my paternal grandmother Ellen Veronica Perry's estate at paragraph 4(d) as follows: "… An equitable interest as to 2/6ths share of [the Fernmount land], the total value of which is property is (sic) $400,000 being 1/3 of 2/6 equitable interest in that property. 4. I relied on my mother, Anne Perry, for all information relating to my knowledge of my entitlements in my father's estate. I did not understand I could call for my entitlement to be paid to me upon attaining the age of 18. 5. I relied on my mother's representations that she held my interest in trust for me. 6. I did not know I was entitled to 2/9ths of my father's estate until I obtained legal advice prior to the commencement of these proceedings.
In my view, a consideration of the individual representations that Tanya alleges made up the Fernmount land representation justifies those representations being divided into two subsets.
Representations (iii), (iv) and (v), to the effect that Anne would remain on the Fernmount land until her death, and divide it equally between her children in her will; that any discussions affecting the Fernmount land would be agreed between the family members; and that the children's names could not be put on the title, were, to the extent that they were in fact made, aspects of the family deal. I do not accept that those representations have any separate relevance to these proceedings other than being aspects of the family deal.
Representations (i) and (ii) are a different matter (collectively "Tanya's share representations"). They are to the effect that Tanya's entitlement to Russell's estate was 1/9 of a one-half share of the Fernmount land, and the reason was that Anne had purchased Ray's half interest with funds solely sourced from Anne's own borrowings.
It is to be noted that Tanya appears to have made an arithmetical error in pleading the terms of par (i) of the Fernmount land representations, where she alleges that the representation was that her entitlement was one ninth of a one half share of the Fernmount land. That would equate to one eighteenth of the whole of the land. In par 3a of Tanya's 5 October 2018 affidavit, which is set out above, Tanya said that Anne told her: "Your share of this farm is 1/3 of 2/3 of 1/2 because I took out a loan to pay out your uncle Ray's half share." If that statement was made, it was to the effect that Tanya's share was two ninths of a one-half share, not one ninth.
Although the defendants admitted that representation (i) was made in the FAD, they must have been proceeding under the same arithmetical mistake.
In reality, Tanya's claim is that she was led by Anne to believe that her interest in the Fernmount land was two ninths of one half, when it was in reality two ninths of one half and two ninths of 15/17ths of the other half.
It should be observed that, while it appears that Anne did understate her children's beneficial share in the ownership of the Fernmount land, the true position may never have been completely clear, and is probably not now determinable on the basis of reliable evidence. On the basis of the findings that I have made above [203] , before Anne bought Ray's half interest in the Fernmount land, she used the life insurance proceeds of $16,376, and the $20,000 she borrowed from the Bank of New South Wales, to buy the property in Bellingen for $27,000, and for other purposes connected with the family. Although, in about 1977, as Anne now accepts, she purchased Ray's half interest using the $16,000 share in the fire insurance proceeds, together with another $2,000 borrowed from the Bank of New South Wales, in October 1978, while the new house on the Fernmount land was being constructed, Anne sold the property in Bellingen for $30,000. The reality is that it would now be virtually impossible for Anne to prove how the sale price of $30,000 was applied in relation to the improvement of the Fernmount land. It is probable that the proceeds of sale were used for various purposes. However, it is not accurate to say that Anne used the estate's $16,000 as part payment for the half interest in the Fernmount land, and that is the end of the matter. To the extent that Anne used her own money, sourced in Russell's life insurance payment, and money borrowed from the Bank of New South Wales, derived from the sale proceeds of the Bellingen home, to make any improvements on the Fernmount land, Anne would, as trustee, in principle be entitled in an accounting process to claim an allowance for those payments.
While, as I have said, it appears that Anne understated the children's entitlement to share in the Fernmount land, it is highly probable, that if her own contributions as trustee had been taken into account, her own entitlement would have increased significantly from the one third interest to which she became entitled upon Russell's intestacy.
If Anne told the children that she had acquired Ray's half interest in the Fernmount land entirely using funds borrowed by her, that would have been wrong. However, when the improvements to the Fernmount land are considered, it is probable that a significant proportion of the improvements were in fact funded indirectly out of borrowings made by Anne, and out of her own entitlement to Russell's life insurance payment.
Nonetheless, given the admission made by the defendants in their pleadings, even if arithmetically corrected, the Court must proceed upon the basis that Anne made a representation to Tanya concerning Tanya's beneficial entitlement to the Fernmount land that materially understated the amount of that entitlement.
There is no reason for the Court to reject Tanya's assertion that her subsequent actions in relation to Russell's estate were influenced by her understanding as to her relative share in the estate, and in that respect, she acted on the faith of the representations.
However, it remains necessary for the Court to make a finding about the effect of the representations on Tanya's subsequent conduct.
This question must be determined on the basis that the representations concerning Tanya's share in Russell's estate coexisted, as it were, with the family deal. When the Court asks itself the question: if Anne had told Tanya that she was entitled to two ninths of 32/34ths of the Fernmount land, would Tanya, as she claims, have decided that her interest was sufficiently great that she would, soon after she turned 18, have sought legal advice, and proceeded to enforce her right to the completion of the administration of Russell's estate? The Court must answer that question in the light of the coexistence of the family deal.
A number of aspects of the family deal are significant in this context. Perhaps the most significant is that Anne, as the children's mother, was to have a right to live on the Fernmount land rent free for the balance of her life. Given what Anne had done for her children, the Court is entitled to think that all of the children, including Tanya, thought that Anne had a moral right to security of tenure on the Fernmount land for her life. Secondly, each of the children was to receive one third of the whole of the Fernmount land under Anne's will.
I do not accept that the difference on Tanya's part between an entitlement to 2/9ths of 32/34ths of the Fernmount land, and the lesser entitlement of 2/9ths of half of the Fernmount land, is sufficiently great as to make credible an assertion by Tanya that, if she had been aware of the greater entitlement, she would have sought legal advice and enforced the completion of the administration of Russell's estate, the sale of the Fernmount land from under Anne, and the distribution to Tanya of her lawful share.
Although Tanya gave evidence that she acted on Anne's representations, and did not seek legal advice, neither in her evidence nor her submissions did she provide any explanation of why a belief that her entitlement was in fact almost twice what she in fact believed would have made a sufficient difference for Tanya to have refused to participate in the family deal, and, instead, to have insisted upon the final administration of Russell's estate.
Indeed, the evidence given by Tanya in cross-examination strongly suggests that she appreciated that such conduct would have been anathema to the other members of the family, so that she would have continued to participate in the family deal.
Consequently, I do not accept that the making by Anne of the Tanya's share representations had any effect on Tanya's conduct that would now justify Tanya in ignoring the terms of the family deal, and insisting upon the enforcement of Tanya's strict legal rights, without regard to the consequences of the family deal.

[34]

Relevance of beneficiaries' contributions

Tanya submitted [204] that mortgage payments by Tanya of $300 per month for three years, and the payment of $3,000 towards the renovation of the cottage on the Fernmount land, should be "counted in her favour when ascertaining each beneficiary's interest in the estate, or the proceeds of sale of Fernmount". Tanya also submitted [205] that, for various reasons, the contributions claimed by Anne, Mark and Michelle should not be allowed, largely because of Tanya's claim that those beneficiaries enjoyed offsetting benefits for which they made no payments to Russell's estate.
I have not been able to find anywhere a submission by Tanya as to the basis upon which any beneficiary, who made contributions for the benefit of Russell's estate, was entitled to allowances when their respective beneficial interests in the estate were determined.
Anne, as the administrator and trustee, is clearly an accounting party, and would be entitled to claim allowances in the accounting process, and, in that process, would have to give credit for benefits received. Tanya did not identify any basis in principle whereby mere beneficiaries of the estate should be entitled to allowances for benefits that they voluntarily bestowed upon the estate.
There was no suggestion by any party that it was an aspect of the family deal that there would be some accounting for contributions to Russell's estate, and the value of benefits received, as part of the administration of Anne's estate after her death. The absence of such an aspect of the family deal militates against there being a legal entitlement of the beneficiaries for an accounting to be had.
The aspect of the family deal that appears to have allowed Anne to permit Mark and Michelle to agist their cattle on the Fernmount land without an agistment fee, but on the basis that they carried out maintenance and improvements to the land, is inconsistent with there being a final accounting entitlement as between all of the beneficiaries. Viewed realistically, the family deal did not require Mark and Michelle to keep accounts that balanced some notional agistment fee against the value of maintenance and improvements, with vouchers being kept for the purpose of the ultimate accounting.
I have considered the possible application of the principles derived from the following extracts of the judgment of Deane J in Muschinski v Dodds [206] : … Both common law and equity recognize that, where money or other property is paid or applied on the basis of some consensual joint relationship or endeavour which fails without attributable blame, it will often be inappropriate simply to draw a line leaving assets and liabilities to be owned and borne according to where they may prima facie lie, as a matter of law, at the time of the failure… … The prima facie rules respectively entitling a fixed term partner to a proportionate refund of his or her premium and a contractual joint venturer to a proportionate repayment of his or her capital contribution on the premature dissolution of the partnership or collapse of the joint venture are properly to be seen as instances of a more general principle of equity. That more general principle of equity can also be readily related to the general equitable notions which find expression in the common law count for money had and received (cf Moses v Macferlan (1760) 2 Burr 1005 at 1012; [97 ER 676 at 680-1]; J & S Holdings Pty Ltd v NRMA Insurance Ltd (1982) 41 ALR 539 ; 61 FLR 108 at 120) and to the rationale of the particular rule of contract law to which reference has been made: cf Fibrosa, supra, at p 61ff and esp. at p 72). Like most of the traditional doctrines of equity, it operates upon legal entitlement to prevent a person from asserting or exercising a legal right in circumstances where the particular assertion or exercise of it would constitute unconscionable conduct: cf Story, Commentaries on Equity Jurisprudence, 12th ed (1877: Perry ed), vol 2, par 1316; Legione v Hateley (1983) 152 CLR at p 444). The circumstances giving rise to the operation of the principle were broadly identified by Lord Cairns LC, speaking for the Court of Appeal in Chancery, in Atwood v Maude (1868) LR 3 Ch App at p 375 where "the case is one in which, using the words of Lord Cottenham in Hirst v Tolson (1850) 2 Mac and G 134; 42 ER 52, a payment has been made by anticipation of something afterwards to be enjoyed [and] where … circumstances arise so that future enjoyment is denied". Those circumstances can be more precisely defined by saying that the principle operates in a case where the substratum of a joint relationship or endeavour is removed without attributable blame and where the benefit of money or other property contributed by one party on the basis and for the purposes of the relationship or endeavour would otherwise be enjoyed by the other party in circumstances in which it was not specifically intended or specially provided that that other party should so enjoy it. The content of the principle is that, in such a case, equity will not permit that other party to assert or retain the benefit of the relevant property to the extent that it would be unconscionable for him so to do: cf Atwood v Maude at 374-5, and per Jessel MR, Lyon v Tweddell (1881) 17 Ch D 529 at 531.
I do not think that these principles have any application in the present case. Although the family deal contemplated that individual beneficiaries may, either as a result of agreement within the family, or after discussion between the family and Anne, gain different forms of entitlement to benefit individually from the use of the Fernmount land, it would be incorrect to describe the family deal as "some consensual joint relationship or endeavour" or joint venture as contemplated by Deane J.
Furthermore, Tanya bases her claim for an allowance on the mere allegation that contributions to mortgage payments were made and an amount was paid for the renovation of the cottage on the Fernmount land. There was no detailed evidence of discussions with Anne concerning the basis upon which those payments were made. In the absence of evidence to the contrary, I hold that, more probably than not, the payments were made voluntarily by Tanya, as contributions by her in the nature of gifts to her mother, in circumstances where there was no contemplation of Tanya receiving any recompense, other than the benefits that she herself may have received, and may receive in the future, by the implementation of the family deal in favour of Tanya. As will be seen below, Tanya did receive benefits from time to time that were exclusive to her and in which the other family members did not share.
I accordingly find that Tanya is not entitled to any allowances in respect of her contributions as claimed. Nor would I have accepted the allowances claimed by Mark and Michelle. However, as I have already noted, the claim made by the defendants for allowances for their contributions was only made contingently on Tanya being entitled to allowances for the contributions that she claimed.

[35]

Guarantee and mortgage over the Fernmount land

As I have explained above at [51], Tanya sought orders that Anne account to Tanya on a wilful default basis, and that Anne, Mark and Michelle indemnify Tanya, in respect of the consequences of a mortgage that Anne granted over the Fernmount land to secure a guarantee given by Anne in respect of loans taken out by Mark and Michelle to acquire and improve their dairying enterprises.
Tanya did not seek orders that required Anne, Mark and Michelle to take the steps necessary to terminate the guarantee and discharge the mortgage over the Fernmount land.
Consequently, Tanya would only become entitled to orders that Anne, Mark and Michelle compensate Tanya if the mortgagee exercised its security rights under the mortgage over the Fernmount land in a manner that diminished the value of Tanya's interest in that property as a beneficiary of Russell's estate.
As it has happened, the mortgagee has not exercised its security rights, and, during the course of the hearing, Mark and Michelle refinanced their loan arrangements in respect of their dairying enterprises, which had the consequence that Anne's obligation as guarantor was released and the mortgage over the Fernmount land was discharged.
Accordingly, whether or not Tanya would otherwise have been entitled to declaratory relief in respect of an entitlement to an account or indemnity from Anne, Mark and Michelle, there is no longer any utility in that relief being granted.
The guarantee was released, and the mortgage discharged, after the parties had fully contested Tanya's claim in respect of the guarantee and the mortgage over the Fernmount land, and the parties had substantially completed making their submissions to the Court on the issue.
In those circumstances, the Court should deal with this aspect of the dispute, as it may be relevant to the determination of the costs orders that should be made in these proceedings.
As I recorded at [53] above, Tanya also claimed an order against Mark and Michelle that they account to Tanya for the profits that they have made by means of the use of Tanya's interest in the Fernmount land. As I understand it, Tanya has not supported that claim for relief in her final submissions. Tanya has not identified any principle that requires one beneficiary, who has made a profit from the use of the capital of an unadministered deceased estate, with the unauthorised consent of the administrator, to account for that profit to another beneficiary, at least where the use of the capital has not diminished the estate. There has been no suggestion that a beneficiary owes a fiduciary duty to the administrator or other beneficiaries in respect of the use of the estate's capital that comes into the beneficiary's hands. Furthermore, even though there was evidence that Mark and Michelle could not have secured the loans necessary for them to acquire and improve their dairying enterprises without the guarantee and mortgage granted by Anne, there was no evidence that could support a determination of the proportion of the profits made by Mark and Michelle that could be attributed, on a principled basis, to the granting of the guarantee and the mortgage.
It will therefore only be necessary for the Court to consider Tanya's claim against Anne that she breached the duty as administrator of Russell's estate that she owed to Tanya by granting the guarantee and mortgage, and against Mark and Michelle on the basis of their knowing involvement in Anne's breaches of duty.
As will be seen, Tanya accepts that she was given some explanation of the circumstances in which the Fernmount land was mortgaged, on 19 January 2006, to secure a loan of $1,250,000 million to Mark and Michelle, but Tanya alleges that she was only told that Anne would grant a guarantee, and not that the Fernmount land would be encumbered by a mortgage. Tanya further claims that she was not given adequate information about the circumstances of the transaction, so that any consent that she gave was not on a fully informed basis. Tanya alleges that, after 19 January 2006, Mark and Michelle increased the amount of their borrowings and that Anne consented to the guarantee covering the increases, so that the Fernmount land was further encumbered without her consent.
Anne, Mark and Michelle responded to these claims by asserting that Anne was within her rights to grant the guarantee and the mortgage without strictly having Tanya's consent, because she was authorised to do so under the family deal, which, according to the defendants, did not require Tanya's consent, but only that proposals to use Russell's estate be discussed within the family. The defendants also asserted that, in fact, Tanya was given sufficient information about the proposals, and that she in substance gave her consent, or otherwise was informed of or became aware of what Mark and Michelle were doing in the conduct of their dairying enterprises, and must be taken to have acquiesced in the steps taken by Anne, by reason that Tanya did not raise any objection to what was happening.
The defendants' claim that Anne was entitled to grant the guarantee and the mortgage without the informed consent of Tanya raises difficult questions. The family deal existed in the minds of the members of the Perry family and they have all accepted that fact. However, the family deal was an amorphous, undocumented understanding that was formed and maintained over a period of decades as a result of conversations between members of the family and their conduct in mutually adhering to its terms. The family deal was not legally enforceable in relation to prospective actions by members of the family, but instead had legal consequences by reason of the fact that, in various ways, members of the family acted on the faith of the continuation of the family deal which made it inequitable for individual family members to insist upon the enforcement of their strict legal rights. In that way, the family deal tended to have a retrospective legal effect.
The family deal was also likely to be subject to unexpressed assumptions by the members of the family, as they do not appear to have expressly considered how family members should be provided with economic assistance using the value of the Fernmount land, and the family did not reach any consensus on that subject.
Given that lacuna in the family deal, the extent to which the family members accepted a moral obligation to conform to the deal should be taken to have depended on the precise nature of a particular proposal and its significance to the maintenance of the value of the estate. That is because a primary feature of the family deal was that the value of Russell's estate would be maintained in the form of the Fernmount land and would be devised equally to the three children upon the death of Anne.
It is unlikely that the family reached a precise consensus about whether Anne would be free to deploy the value of the Fernmount land in the interests of family members, either on the basis of there being a discussion between family members, on the one hand, or unanimous agreement within the family on the other. There was no evidence of any specific discussions on that subject.
If it is a correct understanding of the family deal that the nature and the extent of the agreement within the family that was required before Anne could enter into a particular transaction involving the Fernmount land depended upon the circumstances, as I believe to be true, then in my view, the size of the loan that Anne guaranteed and secured by mortgage over the Fernmount land, at least from the time that $1,250,000 was borrowed by Mark and Michelle to buy Taylor's Farm, required the unanimous agreement of all of the beneficiaries of Russell's estate. I will refer below to the evidence that demonstrates that the existence of the guarantee and the mortgage created a significant commercial risk to the ability of Anne to retain the Fernmount property, as well as to the value of Russell's estate.
Consequently, although I do not find that it was a feature of the family deal either that discussion within the family was sufficient, or that unanimous agreement was required, I am satisfied that the significance of the granting of a guarantee of a $1,250,000 loan, and the grant of a mortgage to secure the guarantee, was of such magnitude that it ought reasonably to have been apparent to members of the family that the value of the estate should not be put at risk without the unanimous agreement of the beneficiaries.
That conclusion is consistent with the fact that the defendants' case was that Anne and Mark did in fact inform Tanya of the significant aspects of the proposed transactions over the years, and that Tanya, by agreement or acquiescence, permitted the transactions to take place.
Tanya gave evidence of Anne having used the Fernmount land as security for loans taken out by her to assist with flood relief in amounts of $39,000 on 12 August 1996, $27,000 on 22 October 1996, and $42,000 on 19 September 2002. Tanya said that she was not included in discussions in relation to the granting of those mortgages.
Tanya also acknowledged that, in about 1988 and 1997, Anne guaranteed loans of $12,000 and $20,000 taken out by Tanya, and, in about 2003, Anne guaranteed the deposit bond for $56,000 that Tanya used to acquire an apartment. Tanya explained that she repaid all of these liabilities without imposing any burden on the Fernmount land. Anne gave evidence that she agreed to provide this assistance to Tanya, without seeking the prior consent of the other members of the family.
I do not think that the occurrence of these transactions undermines my conclusion about the operation of the family deal in relation to exposing the Fernmount land to the risk involved in the guarantee and mortgage of a loan of $1,250,000. The disparity in the risks associated with the different transactions was of such a magnitude that it may be accepted that Anne had authority within the family deal to take relatively minor risks where that was advantageous for the assistance of individual family members.
For the purpose of determining the merits of Tanya's claim concerning the guarantee and mortgage granted by Anne over the Fernmount land, it is necessary to take into account aspects of the evidence relating to Tanya's other claim for a share of the value of the Fernmount land, which she claims is attributable to the work that she did in obtaining development approval for the construction of an eco-tourist resort on the property. The reason is that, according to Tanya, what she called the joint venture was proposed by Tanya so that she and Louise would gain a benefit from the future use of the Fernmount land to counterbalance the benefit that Mark had enjoyed by being able to build up his and Michelle's dairying enterprises using the Fernmount land as security. Tanya's evidence was [207] that during the 2008 Easter break, Tanya and Louise travelled to Bellingen and had a conversation around the kitchen table with Anne, Mark, Michelle and Louise about commencing a joint venture which included words to the following effect: Me: It is unfair Mark should get all the benefit from the farm. Louise and I should benefit too. Mark: What do you mean I've been getting all the benefit from the farm? That's not true. Me: You've been building an asset and getting an income and we're not. [Mark got upset and left the table] Me: If Louise and I get this development up and running it will even things up and make it fair. Anne: I could be open to that idea.
The significance of this evidence is that the conversation took place in 2008, which was some time after the loan to Mark and Michelle had been increased to $1,579,000 in December 2013, and Anne had extended the limit of the guarantee to $1,310,000.
While there may be scope for argument on the evidence about the extent to which Tanya had been informed of the detail concerning the loan to Mark and Michelle, and the terms of the guarantee and the mortgage granted by Anne, Tanya's evidence concerning the reason for her request that the other family members enter into the joint venture shows that Tanya understood that Mark and Michelle had gained a substantial benefit from using the Fernmount land to facilitate the loan to Mark and Michelle. As the evidence demonstrates that the members of the family pursued the joint venture until it was decided that the cost of the project precluded its implementation, Tanya at least enjoyed the benefit of being granted the opportunity to increase her wealth using the Fernmount land as a counterbalance to the benefit enjoyed by Mark. Although the joint venture was not pursued to fruition, and Tanya might not succeed in her claim for an additional share in the sale price of the Fernmount land, it is clear that the other members of the family gave her the commercial opportunity that she requested.
If, by Easter 2008, Tanya thought that she had been provided inadequate information concerning the loan to Mark and Michelle and the extent to which that loan was the subject of any guarantee or security binding the Fernmount land, that was the time for Tanya to require that the further information be provided to her. If she did not do so, then the other members of the family were entitled to understand that Tanya was satisfied with the information that she had received, and that the cooperation of the other members of the family in the joint venture proposed by Tanya was considered by Tanya to be adequate recompense for the benefits enjoyed by Mark.
Even if the evidence was sufficiently clear to enable the Court to make reliable findings as to the substance of the communications between the parties on the issue of the loan, guarantee and mortgage before Easter 2008, which I do not think it is, the Court cannot ignore the fact of the joint venture, which in a sense 'reset' the issue of what Tanya knew and what additional information she was entitled to require that she be given.
I consider that the most reliable way to approach the resolution of the dispute between the parties concerning the guarantee and the mortgage over the Fernmount land is to start with the communications between Tanya and Anne and the solicitors for Mark and Michelle and the solicitors for Tanya in late 2015, when Tanya finally took a formal stand about the loan and the fact that the Fernmount land had been put at risk. The reason I will start there is that the Court can assume that the solicitors' letters were written with the instructions of the relevant clients, so that the letters demonstrate the knowledge and the position adopted by the parties, including, importantly, Tanya's demands concerning the future exposure of the Fernmount land to the loans taken out by Mark and Michelle.
On 6 October 2015, Tanya sent an email to Anne in the following terms: I would like a full breakdown of all the transactions that have been taken against our property since Mark used our equity originally to purchase Taylors. I would like the current full amount of debt held against our property. I want to know the terms of Marks original loan. My concern is that you are allowing Mark to continue to use our equity without informing Louise and I and asking our permission for these transactions. If this is the case it is a breach of trust and breach of our agreement which has legal ramifications. This should take a week to get together.
Tanya tendered a diary note of a telephone conversation that she had with Anne on 11 October 2015. Anne advised Tanya that she would not be given the figures that she asked for. In response to the question from Tanya: "How much has Mark taken?" Anne responded: "I am not saying but there have been three transactions." When Tanya asked: "3 transactions for How much?" Anne responded: "I am concerned at your approach Mark is paying back the loans".
These communications support the conclusion that, while Tanya had been informed that Mark had acquired Taylor's Farm with a loan that was secured on the Fernmount land, she did not know all of the details, particularly in relation to the possibility that the loan had been increased. Anne's response, in refusing to provide the detail requested, save for informing Tanya that there had been three loans, tends to confirm that Anne had not fully disclosed the position to Tanya.
In response to email requests made by Tanya to other members of her family, on 28 October 2015, the present solicitors for the defendants wrote a letter to Tanya that relevantly said: … I am instructed that you, your sister and your mother consented to the [Fernmount land] being used as collateral security for the purchase of Mark & Michelle' property [Taylor's Farm]. When Taylor's Farm was purchased on 19 January 2006, security was extended by Rabobank Australia Ltd in the amount of $1,250,000.00. At the time, due to the nature of the farming enterprise, collateral security was required as there was not sufficient equity available in the value of Taylor's Farm by itself to extend finance. Whist Mark & Michelle reduced the liability extended by Rabobank Pty Ltd, additional funds were borrowed in December 2013 to facilitate the construction of a new dairy at Taylor's Farm. Accordingly, Mark & Michelle's finance was extended from $1,250,000.00 to $1,579,000.00. At present, in respect of this loan, there is $1,519,000.00 still owing after the construction of the new dairy and renovations to the residence. [The Fernmount land] is used as collateral security for this amount securing by mortgage the limited guarantee extended by Ann Perry in the amount of $1,310,000.00. It should be noted, however, in relation to the finance secured, the principal mortgage is secured primarily by the Taylor's Farm property, now worth approximately between $1,350,000.00 and $1,500,000.00. In addition to that first mortgage held over the Taylor's Farm property, Rabobank Pty Ltd holds a fixed and floating charge over all assets in the name of Michelle and Mark including assets used to conduct their farming partnership which includes: 1. Three vehicles. 2. Two tractors. 3. An argo and quad bikes. 4. Milking equipment. 5. Mulchers, spreaders and direct drilling machinery. It is estimated that the aforementioned machinery, plant and equipment is worth approximately $300,000.00 to $350,000.00. The security extended by the partnership also includes a fixed and floating charge over Mark and Michelle's herd of what is now 430 cows (230 of which are A2 quality milking cows) worth approximately $615,000.00. The above information is provided to demonstrate that the current level of indebtedness ($1,519,000.00), is covered by the value in Taylor's Farm and all farming plant, equipment and cattle (conservatively valued at $2,265,000.00). In addition to the above asset base being sufficient to cover debts, Mark & Michelle fund on a yearly basis, extensive risk management plans to ensure that all articles, plant, equipment, improvements and indeed their own health and life are adequately insured sufficient to cover the level of indebtedness payable to Rabobank. Mark instructs that the finance that was provided to him was secured by a guarantee provided by his mother that was approved, it was his understanding, by both his sisters. He has instructed that at any time you could have asked him to provide verification as to his level of indebtedness. He would have provided you with this information direct (had circumstances been different and there been clear communication channels between family members) …
The last paragraph in the extract appears to concede that Mark had not provided full details of his loans to Tanya, in that it says that he understood that his sisters had given their approval and those details would have been provided if required.
Although there was no evidence to support the values for the property asserted in this letter, it is likely to have been a reasonably accurate broad indication of the position. As Mark and Michelle were the principal debtors, the liability to repay the loan of $1,519,000.00 would primarily have fallen on them. However, it remained true that the existence of the guarantee and mortgage over the Fernmount land was a significant commercial risk. The value of the assets of Mark and Michelle that were mortgaged to the lender may have reduced in the event of a mortgagee's sale. I would infer that, if the mortgagee was unable to recover its loan quickly in the event of default by Mark and Michelle, it would have a right under the guarantee and mortgage granted by Anne to recover the debt from Anne, if necessary, by exercising its rights as mortgagee of the Fernmount land, without first having to exhaust its rights of recovery against Mark and Michelle. While the existence of the guarantee and the mortgage placed a significant risk on the Fernmount land, it is not possible to put a value in money terms on that risk.
On 9 November 2015, Tanya's then solicitors wrote a response to the letter written by the solicitors for Mark and Michelle, which raised a number of claims that have been prosecuted in these proceedings, including what was described as "Unauthorised Use of the Property". On that subject, the letter said: The principle that our client's immediately family fought for in their claim against the estate of the late Ellen Veronica Perry was that all children are equal. It appears that favouritism and unfair advantage has been given to Mark Perry. In about 2003, the Property was used as guarantee for a business loan for Mark and Michelle Perry to commence share farming on property owned by the Caban family in the amount of $212,000. In December 2005, the family agreed for the farm to be used again as security for the purchase of [Taylor's Farm] for Mark and Michelle Perry. The reason given for Tanya and Louise to agree to this was to support Mark who had not received an education and he needed assistance. Tanya was made to feel guilty as she has received a tertiary education. Our client had not received any assistance from Anne Perry in relation to her tertiary education and she has had to financially support herself from the time she left school in 1988. Our client received no legal advice with respect to the transaction which was intended to assist Mark and Michelle Perry. She was unaware that a mortgage had been registered on the Property until she instructed us to undertake searches recently. Further, our client was never consulted regarding the additional funds borrowed in December 2013 to fund the construction of a dairy on Mark's farm. Our client finds this most concerning. We note that your comment "at any time you could have asked him to provide verification as to his level of indebtedness" is inappropriate and absurd on the basis that our client's informed consent was never obtained in the circumstances. The onus rests with those who wish to use another person's property detrimentally. Further, we note that there has been a possible breach of the mortgage in that the mortgagee would be unaware of the equitable interests that our client and her siblings hold in the Property. It has become apparent from your letter that since 2013, our client has not been involved in significant decisions affecting the Property. It is apparent that Anne Perry has been in breach of her trustee obligations as Administrator of the estate of the late Russell William Perry and as registered owner of the Property. Our client requests a full accounting of all loan transactions made on the Property from January 2006 to date. She also requests confirmation as to which loans were for the benefit of Anne Perry. For the above reasons, our client has instructed us to lodge a caveat in the Department of Land and Property Information. We now enclose a copy for your reference. We look forward to a response regarding the matters stated above. Further, our client requests that all of the co-owners agree to attend a mediation in the near future so that all of these matters can be ventilated and resolved without the need for our client to resort to commencing formal legal proceedings to protect her interests. Further, our client will seek orders that her legal costs are paid by your clients and Anne Perry personally if she is forced to commence legal proceedings. Our client simply wants her lawful entitlement to the Property (including recognition for her contributions to the Property) and to her lawful share of her father's estate. In this regard, our client also requires that her equitable interest in the Property to be formally registered on the title. Finally, our client also requires: 1. that Mark and Michelle Perry provide a proposal on how they intend to reduce the current amount of liability over the Property with a view to ultimately discharging the current mortgage; 2. a written undertaking from Anne Perry, Mark Perry and Michelle Perry that there will be no further funds borrowed or mortgages incurred over the Property until this matter is resolved; and 3. confirmation that no other significant decisions will be made with respect to the Property without obtaining our client's consent via this office. We look forward to hearing from you.
The following observations may be made about the significance of the statements made in this letter: 1. Tanya accepted that, in December 2005, she agreed to the Fernmount land being used as security for the purchase of Taylor's Farm by Mark and Michelle. 2. The assertion that Tanya's agreement was given because she was made to feel guilty is a subjective claim of which there is no evidence in these proceedings. 3. The letter implied that there was some deficiency in Tanya's consent to an agreement entered into with Anne, Mark and Michelle because Tanya did not seek legal advice at the time. 4. The solicitors claimed on Tanya's behalf that she was not told about the mortgage registered against the title to the Fernmount land. It follows from the solicitors' reference to the family agreement for the farm to be used as security that Tanya must have understood that Anne was going to guarantee the loan. While the grant of a mortgage to the lender in addition to the guarantee would have improved the lender's position in relation to recovery of the loan out of the value of the Fernmount land, the granting of the mortgage by Anne is sufficient to have that effect, albeit that the lender would have to have followed a different course by first getting judgment against Anne on the guarantee, and then obtaining a writ for the levy of property to authorise the Sheriff to sell the Fernmount land. 5. The solicitors claimed on behalf of Tanya that she was unaware that the loan and the risk under the guarantee were increased in December 2013 to construct a dairy on Taylor's farm. 6. The demands made by the solicitors at the end of the letter are significant, particularly the demand in par 1 that Mark and Michelle provide a proposal on how they intended to reduce the liability secured by the Fernmount land, with a view to ultimately discharging the current mortgage. Although that requirement fell short of a demand that steps be taken to free the Fernmount land from the guarantee and the mortgage, the letter clearly put Anne, Mark and Michelle on notice that Tanya required them to commence the process of obtaining the discharge of the guarantee and the mortgage.
Tanya's solicitors' letter also dealt with what she has called the joint venture, and ended with the following request: Our client seeks a formal agreement with the other co-owners of the Property in (sic) which recognises that the DA has significantly increased the value of the Property and this increase is to be shared as 60% to our client and 40% to Louise Perry. We note that the Property can be valued to determine the increase in value.
Although I do not think that the evidence permits the Court to make detailed findings as to the truth of contested evidence of conversations between Tanya and other members of the family in relation to her providing consent to the Fernmount land being used as security for loans made to Mark and Michelle, there are some conclusions that may properly be reached.
Tanya's evidence in chief [208] was that, in late 2002 or early 2003, she "was advised that the Fernmount Property would be used as security for a business loan to be taken out by Mark". She said that she attended a meeting with Anne, Mark and Louise in a solicitor's office and was told by Mark: "I need a business loan to become a share farmer on Cabans. The amount will be around $212,000 and Mum will go guarantor." Anne said: "If Mark can't repay the loan the bank will be able to call on my assets to satisfy the debt. That includes the farm." Tanya claimed that she did not understand from this conversation that a mortgage would be placed on the title to the Fernmount land to secure Anne's guarantee.
It is not clear from this evidence that Tanya was not told, in substance, that the Fernmount land would be the subject of a mortgage. As I have explained above, the granting of a guarantee by Anne would have put the Fernmount land at risk if Mark and Michelle were unable to repay the loan. The statement attributed by Tanya to Anne made it clear that the lender would be able to call on the Fernmount land if the loan was not repaid.
Although Tanya did not explicitly say so in her evidence, it is implicit that she gave her consent to Anne granting the guarantee. I do not consider that Tanya has made out a good case that her consent was not effective, because she had been provided with inadequate information for her consent to be knowing consent. I infer that at the meeting in the solicitor's office, Tanya could have sought any information she required.
I note that Anne said in her evidence [209] that she said in a discussion with all of her children that Mark and Michelle "will need finance and a guarantee and mortgage over the Fernmount property", and that Tanya said: "It is a good opportunity and you should help him." Anne acknowledged that an agreement had been made that Mark would promise that, if there was a problem, he would have to sell up first.
Tanya claimed [210] that she did not consent to the registration of a mortgage on the title to the Fernmount land, but I am satisfied on the evidence referred to above that, even if Tanya did not in fact appreciate that a mortgage would be granted, she was sufficiently informed that the Fernmount land would be placed at risk, because Anne proposed to grant a guarantee of the loan to be made to Mark and Michelle.
Tanya's evidence of the circumstances in which Mark and Michelle purchased Taylor's Farm [211] was to the effect that Anne said to her in early December 2005: "We just need to be the guarantor." Tanya said: "OK." Tanya then noted that, on 19 January 2006, Mark and Michelle, borrowed $1,250,000 which was secured by, among other things, a registered mortgage over the Fernmount land. Tanya said that she "was not afforded a reasonable opportunity to provide informed consent" to the mortgage, and that she was never shown any paperwork in relation to this loan or the security granted, and was not made aware that the loan had the capacity to be further redrawn whilst secured by the same mortgage over the Fernmount land.
Anne's response to this evidence [212] included that she said to Tanya: "I will need to guarantee his loan using the farm as security," and that Tanya expressed concern about the risks, but thought the purchase was a good idea. She said that at no time did Tanya say anything negative about the business proposal that Anne could recall, and that she acted with the consent of all of her children after discussions and disclosure with them.
In about December 2013, Mark and Michelle's loan was extended from $1,250,000 to $1,579,000 to facilitate the construction of a new dairy on Taylor's Farm, and Anne extended the limit of her guarantee up to the amount of $1,310,000. Tanya said that she was not included in any discussions regarding the extension and that she did not consent to the use of the Fernmount land for this purpose.
Tanya's evidence about the increase in the loan and the extension of the limit of the guarantee was given in pars 32 and 33 of her affidavit. The part of Anne's affidavit in reply in which she responded to the paragraphs of Tanya's affidavit does not include any response to Tanya's pars 32 and 33.
In a later affidavit [213] , Anne gave evidence of Tanya visiting Bellingen in 2011, when Anne informed her that Mark was getting plans drawn up to improve the old dairy "to take to the bank" because it was not safe. Anne saw Tanya wander around Mark's farm with him and "then they came in, sat in Marks kitchen as I made tea and I watched as Mark took her through some documents". Part of the conversation deposed to by Anne was: Mark said: I will have to borrow more money to improve the dairy, I've spoken to the bank, they will lend it if mum extends her guarantee, we are going to put in an application. I said: It has to happen Mark, there is no disputing it. Tanya said: You'll just have to do it, it's dangerous the way it is.
Mark gave evidence [214] that he had a telephone conversation with Tanya in which she approved his application for the original $1,250,000 loan by which Mark and Michelle purchased Taylor's Farm. Mark also said [215] that he did not recall anything negative being said by his sisters about the fact that the loan was secured against the Fernmount land, and he deposed to a specific conversation with Tanya in which she said: "You have to promise if there is any risk or you can't make a go of it, that your farm will go first."
Mark gave the following evidence about a discussion with Tanya in 2013 about the increase in the loan to improve the dairy on Taylor's Farm [216] : I said: To fund the improvements I need to refinance and it will increase my payments but with extra cows we can milk and labour savings, we can manage it, it's a no-brainer. Tanya said: You have to do it for your health and to keep up with the technologies.
Mark also gave evidence [217] that he told Tanya in mid-2015 that he and Michelle were going to renovate the farmhouse, and that Tanya approved and visited midway through the renovation to the residence on the property, and after they had improved the dairy and commented: "This is great, much better, you've added a lot of value to this place."
However, Mark swore a further affidavit [218] in which he in effect started again and repeated in more elaborate form the evidence in his earlier affidavit on the issue of Tanya's knowledge and approval of the loans made to Mark and Michelle that were secured by the guarantee and the mortgage over the Fernmount land.
It appears that, on 21 September 2017, the Registrar made an order by consent that the defendants serve any further evidence by 27 October 2017, and, on 27 November 2017, the Registrar made a further consent order extending the time for the defendants to serve "evidence in reply to the Plaintiff's evidence" to 21 December 2017. Those orders did not, in my view, authorise Mark to serve a new affidavit that was in substance improved evidence in chief in response to Tanya's initial affidavit.
It is a professional obligation of the lawyers for parties to litigation to prepare the parties' affidavits in a way that conforms with the witnesses' obligation to state the truth, the whole truth and nothing but the truth on the issues dealt with: see s 21(4) and Schedule 1 of the Evidence Act 1995 (NSW). Although the later affidavit was prepared only about 10 months after the earlier one, it has the appearance of a carefully crafted legal document with substantially more detail than is found in Mark's first affidavit.
Mark swore an even later affidavit, apparently without leave, on 27 September 2018, that contained evidence of discussions with Tanya about Mark's need to build a new dairy and Tanya's alleged approval of the project.
Although Tanya swore further affidavits on 21 August 2018 and 5 October 2018, she did not respond to the further detailed evidence in Mark's affidavits on this issue.
Michelle swore an affidavit on 5 May 2017 that provides some support for a finding that Tanya approved of the initial transaction involving the acquisition of Taylor's Farm, but does not provide significant evidence that Tanya was aware that any additional borrowing for the purpose of building a new dairy was to be secured by a mortgage over the Fernmount land.
As there was no objection to the defendants reading Mark's 1 February 2018 and 27 September 2018 affidavits, I have read them and taken them into account. In the circumstances described above, I have placed little weight on the additional detail of conversations that Mark claimed he had with Tanya, and Tanya's involvement in assisting with aspects of the dairy enterprises. It is notable, however, that the additional detail does not include the specific provision of information to Tanya that the increases in the loan to pay for the new dairy or the renovation of the house would be covered by the guarantee and the mortgage of the Fernmount land.
For completeness I record that documents [219] obtained from the lender, Rabobank, demonstrate that, on numerous occasions after 8 December 2005, the loan limit was increased, sometimes on a temporary basis, and, on other occasions, there were applications for the deferral of agreed reductions in principal. These changes were made without Tanya's approval, even after the 9 November 2015 date of her solicitors' letter to the solicitors for the defendants that requested that there be no further funds secured by mortgage over the Fernmount land until the dispute was resolved. By 13 December 2016, the total facility limit had increased to $1,709,000. Thereafter, there were a number of applications for the lender to waive obligations to make permanent repayments of principal. On 15 March 2018, Rabobank apparently approved an increase in the limit of $30,000 for payment of stamp duty and legal costs.
Although there is no direct evidence that the limit of liability under the guarantee granted by Anne was increased above $1,310,000, increases in the limit of the guarantee were admitted by the defendants on the pleadings, and in any event, the increases in the amounts borrowed by Mark and Michelle would have made the guarantee more risky.
In the circumstances, I am satisfied that Tanya was entitled to make the demand in her solicitors' 9 November 2015 letter that Mark and Michelle provide a proposal on how they intended to reduce the amount secured by the mortgage over the Fernmount land with a view to ultimately discharging the mortgage.
The defendants contested Tanya's claim in relation to the guarantee and the mortgage granted over the Fernmount land, until the Court was advised that Mark and Michelle had arranged to refinance their indebtedness in a manner that would lead to the discharge of the guarantee and the mortgage.
This issue will now only be relevant to the question of the costs of the proceedings. In due course the parties will be given an opportunity to make submissions on that issue.

[36]

The joint venture agreement

As I have noted above at [56]-[57], Tanya sought a declaration that Anne holds "the value" of a joint venture agreement on trust for Tanya and Louise. That value is said to be the amount by which the value of the Fernmount land was increased because a development approval for the construction of a particular eco-tourism development on the property has become permanent. Consequently, any purchaser of the Fernmount land will be permitted to construct the eco-tourism development the subject of the approval, and will not have to incur the costs or risks involved in preparing the development plan and taking the steps necessary to obtain the council's development approval.
Tanya claimed that the amount held on trust by Anne should be the greater of $350,000 and the difference between the market value of the Fernmount land without the development approval and the eventual sale price.
An analysis of the pleadings concerning Tanya's joint venture claim is set out above at [125]-[142]. In substance, the defendants admitted most of Tanya's allegations concerning the practical steps involved in obtaining the development approval, and that the development approval is now permanently attached to the land. The defendants denied that a joint venture agreement was made in the terms alleged by Tanya and recorded at [127] above. The defendants also denied that the attachment of the development approval to the Fernmount land had increased its value. The defendants denied Tanya's claim that she undertook approximately 80% of the work and spent approximately 40% of the funds required to obtain the development approval. The defendants also pleaded that, if the Court found that the value of the Fernmount land had been increased by reason of the attachment of the development approval, they were also entitled to a proportion of the increase in value, and that their contribution to obtaining the development approval was significantly more than the amount credited to them by Tanya.
The parties fought many strenuously contested issues concerning Tanya's joint venture claim. The resolution of many of those issues would require the Court to determine contested issues of fact concerning the substance of conversations between the parties that occurred on multiple occasions over a lengthy period commencing in about March 2008.
The need to resolve those evidentiary disputes depends upon the Court finding that, now that the Fernmount land has been sold and the net proceeds of sale retained, an identifiable part of those proceeds is attributable to the attachment of the development approval to the Fernmount land.
Given the great forensic difficulty in fairly and accurately resolving the disputes concerning the real substance of the agreements between the parties in relation to the joint venture, I propose to start by examining the evidence to determine whether, in fact, there was an increase in value as claimed by Tanya.
Although there is a contest concerning the value of the effort and costs contributed by all of the parties to obtaining the development approval, there is no doubt that significant costs were incurred, and a substantial effort made by all of the parties. I doubt that it is now realistic to determine accurately the effort contributed by all of the parties, or to place a fair value on that effort. However, in-so-far as there may have been a joint venture that was enforceable at law on some basis, it was a speculative one. Originally, it was intended that Tanya and Louise would actually construct and operate the eco-tourism resort on the Fernmount land, but that proposal was abandoned because of increasing costs and decreasing feasibility. The decision was then made to proceed only to the point where the development approval became attached to the Fernmount land, because of Tanya's belief that the existence of the development approval would add significant value to the land above the cost of obtaining it. However, the joint venture was always at risk of failure, and if, in truth, the sale price obtained by Anne upon the actual sale of the Fernmount land was not greater, in an identifiable amount, than it would have been without the development approval, then the joint venture will have failed, and none of the parties will be entitled to receive any part of the net sale price on the basis that they have some special entitlement arising out of the joint venture.
At the hearing, the parties relied upon expert valuation evidence on the issue of the value of the Fernmount land and whether any additional value should be attributed to the fact that the development approval was permanently attached to the land. As I have explained above, the Fernmount land was ultimately sold after the Court had reserved judgment, and the parties provided to the Court a statement of agreed facts concerning the process of sale, and matters that may be relevant to determining whether the development approval added value. There is a further question as to whether Tanya should be permitted to rely upon additional affidavit evidence concerning communications with bidders for the Fernmount land.
The defendants relied upon a report of a certified valuer, Mr Bryan Guest, dated 28 March 2017. Mr Guest concluded that the Fernmount Land had a value of $1,130,000, excluding GST, at 28 March 2017. Mr Guest attributed no additional value to the existence of the development approval. Mr Guest's opinion was that the highest and best use of the Fernmount land was as a rural lifestyle home. Mr Guest adopted the comparative sales method for determining the market value.
Mr Guest's report included the following in relation to the value added by the development approval: I have reviewed the conditions of consent pertaining to the Development Application approval and consider that the highest and best use as a tourism-based accommodation is a conflicting land use with that derived through sales contained within Section 8.5.1. Rural lifestyle home site purchasers within this location have historically shown enthusiasm for seclusion and quiet and peaceful enjoyment, and noting that conditions of consent necessitate full time on site management, purchaser profile is nominally limited to an industry participant. Noting that I have not been provided with audited costings to achieve development consent, I caution that the conditions are relatively onerous. Conditions of consent include high level of civil works inclusive of a turning lane in both directions, 6.5 metre wide driveway and car park provisioning, potable water supply, together with domestic power.
Mr Guest continued by analysing comparable sales of properties that had development consent approval, and although the dearth of comparable sales meant that the evidence was somewhat out of date, Mr Guest concluded that there was no evidence to support any significant addition to market value from the presence of a development approval.
Mr Guest added: The Development Application approval appears to be relatively user specific, and noting that eco-tourism use is a prohibited activity under the existing plan, the commercial viability of the Development Application consent is highly questionable. A prudent and hypothetical purchaser will examine the consent relative to commercial viability, noting that the existing tourism market is well supplied. Further, my enquiry indicates that generating occupancy requires a high level of professional management to sustain viability of operation. The added value of development consent is considered a reflection of commercial viability of the development. Significant purchaser risk is retained within examining the development consent, noting lack of costings identified …
Mr Guest's opinion, which he maintained in cross-examination, was that there was no comparable sales evidence that supported adding value for the development approval. Mr Guest's opinion was that tourist accommodation in the Bellingen area competed with the substantial tourist developments in the Coffs Harbour area. Mr Guest's greatest concern, however, was that there was no evidence of the cost of the construction of the development in accordance with the development approval, and no feasibility study that demonstrated its commercial viability. Mr Guest noted that a number of the conditions to the development approval appeared to be very onerous in relation to cost. Substantial roadworks were required on the Fernmount land, and an expensive intersection with [an existing road] was required to be constructed. It appears that Mr Guest was referring to conditions 53 and 54 of the development approval. Mr Guest said in cross-examination that, on enquiry of engineers known to him, he was informally given a costing of about $250,000 for the intersection [220] . Mr Guest was also concerned that special condition 27 required that the proprietor/operator of the tourist facility must be a permanent resident of the property. That would tend to neutralise the attractiveness of the Fernmount land to rural lifestyle purchasers.
Tanya relied upon a report dated 11 July 2017 by Mr Jeremy King, certified practising valuer. Mr King adopted a value of $1,660,000 as at 11 July 2017. The valuation method adopted by Mr King was to first determine the value of the Fernmount land by the direct comparison method, which yielded a value in the range of $1,250,000 to $1,350,000. Mr King then separately determined the value of the land at $1,055,000 and the improvements at $255,000, giving a total value of $1,310,000, without adding any value for the development approval.
Unlike Mr Guest, Mr King added a value of $350,000 for the presence of the development approval, which gave him a final market value of $1,660,000.
In his report, Mr King said the following concerning his approach to the value of the presence of the development approval: To determine the value "with DA" we have considered what additional amount a reasonable person would pay over and above the amount one would pay for the property without the DA. In this instance the value of the property "with DA" has been assessed using the cost approach. That is, it is reasonable to suggest that a hypothetical purchaser of the property wishing to utilise the DA would consider how much it would cost that person to obtain the DA if it were not in place… … Ms Tanya Perry has supplied us with a costings schedule pertaining to obtaining the DA (Annexure 4). In this cost approach, we have also considered the zoning changes that have occurred since the DA was obtained that effectively prevent a similar approval on rural land zoned RU1 - Primary Production. It should be noted that the most accurate way of determining the added value of the DA would be if the subject property were sold with the DA in place. That is, there is sufficient market evidence to accurately determine, by way of direct comparison, the market value of the property without the DA. If, at a future point in time, the property was sold with the current DA in place, the added value of the DA would be equal to the actual selling price less the value (at that time) of the property without the DA.
In cross-examination, Mr King readily agreed that the most accurate way to determine whether the development approval added to the market value of the Fernmount land was to sell the property, as "that will reveal all" [221] .
As Mr King noted, he relied upon costings supplied to him by Tanya. The costs included $44,574 as expenses of obtaining the development approval, plus $27,104.10 as the cost of commencing the works that were necessary to achieve the result that the development approval was permanent. Of the total costs given to Mr King of $214,178.10, $142,200 was an amount to compensate Tanya for the time that she personally expended in relation to obtaining the development approval. Of this sum, $120,000 related to work done by Tanya over four months at 20 days per month at $1,500 per day.
There was no evidence that the costs that would notionally have been incurred by a purchaser of the Fernmount Land would have included an amount equivalent to Tanya's claim for her costs of managing the development approval.
Mr King rounded up the $214,178.10 to $250,000 to allow for inflation and an increase in cost because a potential purchaser would allow for a professional architect (not the student architect used by Tanya).
Mr King then added an amount of $100,000 to allow for the scarcity value of the Fernmount Land, because an intervening change in zoning law prevented any further development of rural land zoned for primary production for eco-tourism.
Mr King added the $350,000 to his assessed value without the development approval of $1,310,000, to give a total market value of $1,660,000.
In cross-examination, Mr King said that, in his opinion, the highest and best use of the Fernmount land was as an eco-tourism development with the 18 cabins and conference centre authorised by the development approval. Although Mr King adhered to and defended his approach of adding a value for the development approval on a cost basis, he acknowledged that he had made an assumption that a development in accordance with the development approval was viable, but he could only give professional experience as an explanation for that opinion [222] . Mr King also conceded that he had not tried to estimate the cost of constructing the development and had not done a feasibility study [223] . Mr King conceded that, if the business was not viable, the development approval would have no value [224] .
Mr Guest and Mr King held an expert conclave before they were jointly cross-examined. They agreed that the market value of the Fernmount land, as at January 2018, was $1,375,000, without making any allowance for the development approval. They adhered to their respective opinions that the development approval added no value or that it added value of $350,000.
On the basis of the expert valuation evidence alone, I prefer the evidence given by Mr Guest. I am satisfied that Mr Guest was entitled, on the basis of the evidence available, to be sceptical about the viability of the eco-tourism development the subject of the development approval. There was no evidence of any reliable feasibility study having been done to establish that the business of the development would have been viable. The cost of constructing the development had not been estimated and potential income had not been forecast.
In fact, Tanya and other members of the Perry family had worked towards obtaining the development approval, on the basis that it would not be necessary for them to pay for the Fernmount land because it was already in Anne's ownership, and Anne could live on the property and assist in its management. Even with the advantage of prior ownership of the Fernmount land, the Perry family decided that they could not complete the development.
Mr King did not explain, in terms of accepted valuation theory, why it was proper to determine the value of the Fernmount land on the comparable sales basis and then add the actual adjusted costs provided to him by Tanya, plus an arbitrary amount of $100,000 for the scarcity value of the development approval. Mr King also gave no explanation as to why a potential purchaser would accept that the cost estimate for Tanya's time was a proper one.
Given the high level of uncertainty about whether the development approval added any identifiable value to the Fernmount land, I do not accept that the expert valuation evidence was sufficient to prove any such increase in value.
It will now be necessary to consider whether any evidence arising out of the circumstances in which the Fernmount land was ultimately sold should cause the Court to find that the development approval did, in fact, add value to the property.
The parties provided to the Court a statement of agreed facts concerning the sale of the Fernmount land, apparently dated 2 July 2021. The following is a summary of the principal aspects of the seven-page statement of agreed facts: 1. The Fernmount land was originally placed on the market on 1 April 2019 by way of expressions of interest and listed with Ray White Rural Dorrigo. 2. During the initial marketing campaign from 1 April 2019 until July 2019, 5 of 28 people who had contacted the agent expressed interest in the development application. None of these potential buyers made any offer. Two buyers requested a copy of the development approval. 3. On 16 August 2019, upon a notice of motion filed by Tanya, the Court indicated that it would make orders that the Fernmount land be placed for sale by a specialist resort property agent called Resort Brokers. 4. On 30 August 2019, Anne entered into an exclusive agency agreement with Resort Brokers. The Court made a number of orders requiring the extension of Resort Brokers' agency until 31 August 2020. 5. Resort Brokers advertised the Fernmount land on its website and in its magazine at a sale price of $1,850,000. 6. The statement of agreed facts included the following in relation to the Resort Brokers' agency: [15] No offers were made for the property during Mr Vogler's agency period. Mr Vogler's campaign report attached cites various reasons for his campaign being impeded. His agency period coincided with the bushfires throughout the summer of 2019-2020; followed by the COVID-19 pandemic and associated travel bans, lockdowns and closures; and floods affecting the area. The parties do not agree as to the extent, if any, these matters impeded Mr Vogler's attempt to sell Fernmount. 1. On 1 October 2020, Ray White's exclusive auction campaign commenced, advertising an auction date of 28 November 2020. 2. During the auction campaign, Ray White had approximately 259 inquiries and 45 parties inspected the property. Each person who inspected the property was provided with a hard copy of an information memorandum that included the development approval and an extract of plans. 3. There were nine registered bidders at the auction on 28 November 2020. The highest bidder was a Mr Gibbons, who bid $1,500,000 at the auction and increased his bid to $1,800,000 after telephone negotiations. The next highest bid was $1,185,000. Mr Gibbons did not pay the deposit and his contract was terminated on 19 February 2021. 4. On 3 February 2021, Tanya made a conditional offer to purchase the Fernmount land at a price of $1,800,000. 5. After negotiations with potential buyers, a contract to sell the Fernmount land for $1,750,000 was exchanged on 6 April 2021 and the contract was completed on 18 May 2021. 6. The following are extracts from par 45 of the statement of agreed facts of comments recorded in Ray White's report of statements made by interested parties concerning their interest in the development approval. The first extract concerns the parties who purchased the Fernmount: Price paid $1,750,000. "The fact that it has a DA for cabins had no impact on their decision to buy the property, it was location and proximity to family to visit the kids and grandkids". Highest offer of $1,740,000: "They were not looking to pursue development of the DA". Highest offer of $1,705,071: "They had no interest in development of the DA, the attraction to the property was the location and confidence in the region." Highest offer of $1,300,000: "Was not interested in development of the DA".
The principal significance of the statement of agreed facts is that the ultimate purchasers were uninterested in the existence of the development approval. None of the under-bidders were interested in the development approval. Even accepting that there may have been impediments to the sales process over the 12-month period in which the specialist resort broker was the exclusive agent for the sale of the Fernmount land, no offers were made for the purchase of the property.
Tanya submitted to the Court an affidavit of her solicitor, Guy Moloney, sworn on 27 July 2021, which contained evidence of a discussion between Mr Moloney and a Mr Wheaton on 19 May 2021. Mr Wheaton was one of the bidders for the Fernmount land. Mr Wheaton's personal view of the potential for the Fernmount land was: "Simply agricultural and residential," but Mr Wheaton also made some observations as to his own view of whether the existence of the development approval could have influenced other bidders, and as to the possible value of the development approval. Mr Wheaton was recorded as saying: "there is an implicit premium we placed of $200K".
Tanya also placed before the Court an affidavit of Mr Gibbons, the defaulting purchaser, sworn on 13 July 2021, in which Mr Gibbons said: "I understood that if there could be a possible variation to the DA to increase the cottages to 3-bedroom units, I could have perhaps sold some of those units or leased them to sustain the value of having carried out the DA". That understanding is inconsistent with a number of the conditions to the development approval.
Tanya also placed before the Court a number of spreadsheets, one being a document recording inspections presumably prepared by the Ray White agent, and the second apparently a document prepared by Tanya.
The defendants opposed Tanya being permitted to rely upon the two additional affidavits, as Tanya had not applied for or been given leave to reopen her case. The defendants consented to the Court having regard to the Ray White spreadsheet, but not the spreadsheet prepared by Tanya.
The position of the defendants was that the Court should decide the issue of whether the development approval added value to the Fernmount land based upon the statement of agreed facts and the Ray White spreadsheet.
I accept the defendants' submission that the additional affidavits should be disregarded, as Tanya has not been given leave to reopen her case. In any event, the affidavits do not contain any admissible evidence upon which the Court could properly act to attribute a value to the existence of the development approval.
Tanya delivered additional written submissions on 28 July 2021 and the defendants responded on 12 August 2021.
The principal submission made by Tanya was that the Court should decide that the existence of the development approval added $375,000 to the value of the Fernmount land, being the difference between the final sale price of $1,750,000 and the $1,375,000 valuation agreed to by the expert valuers as at January 2018.
I reject that submission. The contract under which the Fernmount land was sold was exchanged more than three years after the January 2018 date of the agreed valuation. The Court can only act upon the agreed valuation being current as of the date that it was given. The Court is entitled to infer that the market value of the Fernmount land would probably have increased over the three-year period. It would be counter to accepted valuation principle for the Court to infer, without any evidence or the benefit of expert opinion, that the increase in value was attributable to the presence of the development approval.
I conclude that Tanya has failed to establish that the existence of the development approval added to the market value of the Fernmount land at the date of its sale.

[37]

Estate's interest in the Fernmount land

As I have explained above, the defendants claimed that Tanya's entitlement is limited to 21% of the unimproved capital value of the Fernmount land.
The defendants' position on this issue is, in substance, that as the original dwelling on the Fernmount land had burnt down, the value of the improvements should not be included in Russell's estate, as they were made and financed by the efforts of Anne and her brothers, and the property was maintained over the years by the efforts of Mark and Michelle, with very little contribution from Tanya and Louise.
To put this issue in context, I refer to the following aspects of the expert valuation evidence tendered by the parties. The defendants' valuation expert was Mr Guest who, in the context of attributing a total value to the Fernmount land of $1,130,000 as at 28 March 2017, valued the improvements at $180,000 [225] . Tanya's expert, Mr King, expressed the opinion that the value of the Fernmount land as at 11 July 2017 was $1,310,000 (excluding the value added by the development application) of which the improvements were valued at $255,000 [226] .
As the Fernmount land eventually sold for a price of $1,750,000 by contract exchanged on 6 April 2021, the value of the improvements may have increased somewhat.
In order to demonstrate my point, I will assume that the value of the improvements at the time of sale was $240,000, which is an escalation of the average of the values adopted by the two valuers.
At 21%, Tanya's share of this adopted value for the improvements on the Fernmount land would only be about $50,000, so this is approximately the value of this issue to the defendants.
As a matter of legal principle, it would not be a simple matter of excluding the improvements from Russell's estate on the basis that the dwelling on the property burnt down shortly after Russell's death, and Anne, and to a lesser extent Mark and Michelle, were responsible for building and maintaining the improvements. The reason is that all of the improvements are fixtures and, as such, they became part of the Fernmount land, and so part of Russell's estate.
As the administrator of Russell's estate, Anne may, as a matter of legal principle, be entitled to claim allowances for her expense and effort in improving and maintaining the estate. However, Anne could only realise the benefit of that entitlement by participating in an accounting in respect of the affairs of the estate since the grant of letters of administration to her on 23 September 1975. As explained by the learned editors of Jacobs' Law of Trusts in Australia (8th ed, LexisNexis Butterworths), Anne's real entitlement is to an allowance in the accounting process for her expenditure on improving the trust estate: see Re Walder; Townsend v Walder [227] .
If the Court makes an order for Anne to account for her administration of the estate, she will be able to claim these allowances, but she will also have to account for all receipts and expenses over the last 46 years.
I do not think that the evidence discloses conduct on Anne's part that precludes her from seeking an account in relation to her administration of Russell's estate, for the purpose of claiming a special allowance in relation to her conduct and expenditure in improving the value of the Fernmount land. Anne will be given an opportunity to make an election to seek an account. However, the process of accounting is mutual so, if Anne seeks an account she will subject herself to the need to account to the beneficiaries, including Tanya, in respect of some 46 years of transactions in circumstances where it is improbable that she has prepared accounts or retained vouchers that will be necessary for the accounting process to be efficient and cost-effective.

[39]

Summary of conclusions

As a result of the circumstances in which these reasons for judgment have been prepared, it has happened that the issues have been considered in a somewhat episodic way and it has been a challenge to deal with all of the issues coherently.
I will require the parties to consider these reasons and to submit draft short minutes of order to give them effect. I will be open to submissions that the Court has not sufficiently dealt with issues that are essential for determination in order to finally bring these proceedings to a conclusion.
In order to assist the comprehension of these reasons, I will now set out in summary form the principal conclusions that I have reached. I will firstly deal with the relief sought in the proceedings: see the analysis at [34]-[59] above: 1. The Court will not make orders for the revocation of the grant of letters of administration to Anne or the appointment of a replacement administrator, as the need to do so has been overtaken by events, and the completion of the administration of Russell's estate may be effected by appropriate orders made by the Court. 2. Tanya is entitled to a declaration that she is entitled to two ninths of Russell's estate. 3. The estate the subject of Tanya's entitlement will be two ninths of the net sale proceeds of the Fernmount land (subject to the resolution of issues as to costs not yet dealt with), unless Anne pursues her application for an account in order to limit the interest of Russell's estate in the Fernmount land to its unimproved capital value. In that event, Anne will open up the right of all beneficiaries of the estate to require Anne to give a full account of her administration of the estate. 4. Tanya will be entitled to a declaration that Anne holds the whole of the net proceeds of sale of the Fernmount land on trust, unless Anne elects to institute the accounting process referred to above. 5. The Court will not now, in the exercise of its discretion, make an order at the suit of Tanya that Anne account to Tanya on a wilful default basis in respect of her use of the Fernmount land and the proceeds of sale of the Pony Paddocks. 6. Accordingly, the Court will not make any order that Anne pay to Tanya any money found to be due to her as a result of the taking of the account. 7. The Court will not make an order that Anne indemnify Tanya in respect of the loss of Tanya's share in the proceeds of sale of the Pony Paddocks. 8. It is no longer necessary for the Court to consider making an order for the sale of the Fernmount land, as that property has been sold by the voluntary act of Anne. 9. As Anne, Mark and Michelle have taken the steps necessary to cause the guarantee and mortgage over the Fernmount land granted by Anne to be discharged, without any loss to Russell's estate having occurred, there is no utility in the Court making orders that Anne account to Tanya or that Anne, Mark and Michelle indemnify Tanya in respect of the grant of the guarantee and the mortgage. 10. The Court will not make an order that Mark and Michelle account to Tanya for the profits that they have made as a result of the guarantee and the mortgage over the Fernmount land having been granted by Anne. 11. The Court will not make any order that Anne holds on trust for Tanya exclusively any portion of the net proceeds of sale of the Fernmount land on the ground that that portion is attributable to the value of the development approval that resulted from Tanya's efforts, as no additional value attributable to the development approval has been established. 12. The Court will not order that an accounting be undertaken to ascertain the value of Tanya's separate contributions to Russell's estate, and accordingly no such accounting will be undertaken to determine the value of any contributions by Mark and Louise.
I will now set out in summary form the principal conclusions that have been reached that have led to the Court reaching the position set out above concerning the orders sought by Tanya: 1. On a bare balance of probabilities, I have found that Anne did receive the share of proceeds of the sale of the Pony Paddocks as part of Russell's estate: see [196] above. 2. Tanya had a definite understanding since the age of five that Russell had an interest in the Pony Paddocks, and the reason that she did not pursue her claim against Anne for her share of the proceeds of sale of the Pony Paddocks was because of her acceptance of the family deal: see [201] above. 3. Anne was told by the solicitor who acted for her in obtaining letters of administration in respect of Russell's estate that she was entitled to use the children's share of the estate for their education, maintenance and advancement: see [203] above. 4. Anne spent the proceeds of sale of the Pony Paddocks that she received substantially on renovations to the residence on the Fernmount land, the installation of a pool, the purchase of a caravan to enable the family to go on holidays, and otherwise for the general benefit of the family, including herself: see [220] and [229] above. 5. Anne used the Fernmount land for most of the duration of the minority of her children as the home of herself and her family, and as a means of carrying on various farming businesses to raise income for the family: see [231] above. 6. Anne was not authorised by s 44 of the Trustee Act to spend Tanya's share of the proceeds of sale of the Pony Paddocks for the benefit of the family: see [243] and [244] above. 7. The Court has power on any accounting of Anne's administration of Russell's estate retrospectively to authorise Anne to apply Tanya's share of the proceeds of sale of the Pony Paddocks for the benefit of the family, and the Court should do so, on the principles set out above at [283]. Those principles will only become relevant if the Court ordered Anne to give an account of her administration of the estate. 8. The question of whether Tanya's claim in respect of the sale proceeds of the Pony Paddocks is statute barred does not depend upon the application of s 47(1)(c) of the Limitation Act because the claim was not to "recover trust property", as the whole of the proceeds of sale of the Pony Paddocks have been expended and do not exist as a fund capable of recovery: see [292] above. 9. By reason of ss 48 and 52(1) of the Limitation Act, Tanya's claim against Anne for equitable compensation for the expenditure of Tanya's share of the proceeds of sale of the Pony Paddocks was a period of six years that commenced to run three years after Tanya achieved her majority, and accordingly the limitation period has elapsed: see [300] above. The Court's conclusion as to Tanya's claim that the limitation period has not expired because of her reliance on the Fernmount land representations will be referred to below. 10. In the exercise of the Court's discretion, it will not order Anne to account to Tanya on a wilful default, or any other basis, in respect of the administration of Russell's estate during the period of Tanya's minority, including as to the use of the Fernmount land and the expenditure of the proceeds of sale of the Pony Paddocks: see [315] above. That is primarily because, as a result of the passage of time and the subsistence of the family deal until late 2015, it would be oppressive to require Anne to give a formal accounting in the absence of the availability of records necessary for that process. 11. The family deal that governed the conduct of the parties until late 2015 had the elements set out above at [338]. 12. It was an implied feature of the family deal that, so long as it was in effect, no member of the Perry family would lose their right to enforce their entitlements to a share in the capital of Russell's estate, but it also had the effect of releasing Anne from liability for failing to administer Russell's estate in a manner that commercially increased its value for the beneficiaries, as well as failing to keep up-to-date accounts and vouchers to support all transactions relating to the estate: see [342] and [344] above. 13. The family deal operated as a convention between the members of the family as to the uses to which the Fernmount land would be put, which was intended to supplant the strict legal rights that the family members had as beneficiaries of Russell's estate: see [345]. 14. The alleged Fernmount land representations (iii), (iv) and (v) were aspects of the family deal and did not have any separate relevance to these proceedings: see [357] above. 15. The Fernmount land representations (i) and (ii), to the effect that Tanya was only entitled to a one ninth share of one half of Russell's estate, were made by Anne and acted upon by Tanya: see [365]-[366] above. 16. Given the existence of the family deal during the whole period of Tanya's majority up to late November 2015, the Court has rejected Tanya's claim that, if she had known the true share in Russell's estate to which she was entitled, Tanya would not have participated in the family deal and would have commenced proceedings within the relevant limitation period to enforce her claims against Anne for maladministration of Russell's estate during her minority: see [373]. 17. Tanya has not established that she is entitled to an order for compensation from Anne in respect of the contributions that she made from time to time concerning the improvement and maintenance of the Fernmount land: see [381]-[382]. 18. Consequently, the claim made by Mark and Michelle to compensation from Anne for their contributions to the improvement and maintenance of the Fernmount land need not be considered, as the claim was contingent on Tanya being permitted to make such a claim: see [382]. 19. As Mark and Michelle took steps during the course of the hearing that caused the guarantee and the mortgage over the Fernmount land that were granted by Anne to secure loans made to Mark and Michelle to be discharged, there is no longer any utility in the Court making an order requiring Anne to account or Anne, Mark and Michelle to indemnify Tanya in respect of the consequences of the guarantee and the mortgage: see [387]. 20. Tanya was entitled to make the demand in her solicitors' 9 November 2015 letter that Mark and Michelle provide a proposal on how they intended to reduce the amount secured by the mortgage over the Fernmount land with a view to ultimately discharging the mortgage: see [442]. 21. The defendants contested Tanya's claim in relation to the guarantee and the mortgage until the time when they voluntarily caused the guarantee and the mortgage to be discharged: see [443]. 22. Tanya has failed to establish that the existence of the development approval added to the market value of the Fernmount land at the date of its sale: see [485] above.
It will be necessary for the Court to make orders to give effect to these reasons after receipt of draft short minutes of order from the parties. Those short minutes of order should provide for a mechanism for the Court to deal with the question of costs, if the parties are unable to agree on that subject.

[40]

Endnotes

FASOC par 25B
FASOC par 25C
FAD pars 24B and 24C
FAD pars 13 to 16
FASOC pars 13 to 16
FASOC par 17
FAD par 17
FAD par 19
FASOC par 19
FASOC par 20
FAD par 20
FAD par 21
T 5.45
T 6.22
FASOC par 21A
FAD par 21A
FASOC par 21B
FAD par 21B
FASOC par 21C
FAD par 21C
FASOC par 21D
FAD par 21D
FASOC par 22
FAD par 22AA
FASOC par 22A
FAD (first) par 22A
FASOC par 22B
FAD (first) par 22B
Reply par 1A
FASOC par 23
FAD par 22
Reply par 2
FASOC par 23A
FAD (second) par 22A
FASOC par 23B
FAD par 22B
FAD par 23
FASOC par 24
FASOC par 24A
FAD par 23A
FAD par 23B
FASOC par 24B
FAD par 24
FASOC par 25
FAD par 24A
FASOC par 25A
FAD pars 25 and 26
FASOC pars 26 and 27
FASOC par 28
FAD par 27
FAD par 27
FASOC par 29
FAD par 28
FASOC par 30
FAD par 29
FASOC par 31
FAD par 30
FASOC par 32
FAD par 31
FAD par 32
Reply par 3
Reply pars 5 to 12
Reply par 5
Reply par 6
Reply par 7
Reply par 8
Reply par 9
Reply par 10
Reply par 11
Reply par 12
FASOC par 32A
FAD par 32A
FASOC pars 32B to 32I
FAD pars 32B to 32I
FASOC par 33
FAD par 33
FAD par 34
FASOC par 33A
FAD par 34A
FASOC pars 33B to 33H
FAD pars 34B to 34H
FAD par 34C
FASOC par 34
FAD par 35
FAD par 36
FASOC par 34A
FAD par 36A
FASOC par 34AA
FAD par 36AA
FASOC pars 34B to 34I
FAD pars 36B to 36H
AFSOC pars 37, 37AA, 37A, 37B and 40
FAD pars 39 to 40
FASOC par 38
FAD par 40
FASOC par 40
FAD par 43
FASOC 41
FAD par 43
FASOC par 41
FAD par 45
FASOC par 43
FASOC par 44
FAD par 46
FAD par 50
FASOC par 48
FASOC par 49
FAD par 51
FAD par 52
FASOC par 50
FASOC par 49A
FAD par 52A
FAD par 53
FASOC par 51
FASOC par 50
FASOC pars 50B be to 50G
FAD pars 50B to 50G (the defendants have not directly responded to FASOC par 50G)
FAD par 57
[2011] FCA 1123; (2011) 297 ALR 56, at [48]
[2014] NSWSC 315 per Hammerschlag J at [198]
(1995) 49 NSWLR 315 at 318-319
[2019] NSWSC 256; affirmed Flourentzou v Spink [2019] NSWCA 315
[2015] NSWSC 249
[2015] NSWSC 784 at [76]
(2018) 97 NSWLR 615; [2018] NSWSC 125 at [41]
PS pars 78 to 95 and DS pars 55 to 75
PS par 97(h)
FASOC par 23.
Affidavit 21 August 2018.
Affidavit 21 August 2018.
T 46.4 ff.
T 181.41.
Affidavit 6 May 2017 par 48.
Court Book pp 1842 and 1846.
T 254.13.
T 255.34.
Affidavit 27 September 2018 par 21.
Affidavit 6 May 2017 par 53 ff.
T47.13.
T85.38-87.23.
T 183.9-25.
PS Annexure B
The particulars referred to pars 31 and 41 of Anne's 6 May 2017 affidavit
PS par 128(d)
PS Annexure A
PS par 131
At [12.32]
s 47(1)(c)
PS par 124
PS par 126
PS par 108
(1992) 175 CLR 218; [1992] HCA 15, particularly per McHugh J at 312
[1986] AC 112 at 183, 184 per Lord Scarman
(1982) 150 CLR 615; [1982] HCA 16 at 626 per Gibbs CJ and 634 per Mason J
[1970] 1 QB 357 at 372-373
At 184
at 184 and 185
At 184
(1791) 3 Bro CC 401; 29 ER 610
Hoste v Pratt [1798] 3 Ves Jun 730; 30 ER 1243; Reeves v Brymer (1801) 6 Ves 516; 31 ER 1172; Sherwood v Smith (1801) 6 Ves Jun 454; 31 ER 1141; Sisson v Shaw (1804) 9 Ves Jun 285; 32 ER 612; and Maberly v Turton (1808) 14 Ves Jun 499; 33 ER 612
[2016] NSWSC 1223
at [69]
(1932) 47 CLR 417
(2001) 202 CLR 410; [2001] HCA 9
at 420-423
at [40]
Re Application of a Local Health District; Patient Fay [2016] NSWSC 624 per Sackar J at [21]-[23]
(1684) 1 Vern 255; 23 ER 451
(1820) 1 Jac & W 253; 37 ER 372
(1829) 1 Russ & M 577; 39 ER 221
(1862) 30 Beav 520; 54 ER 991
Re Neeson (1869) 6 WW. & aB. Eq. 319; In re Howarth (1873) LR 8 Ch App 415; Re Moylan (1881) 5 AJR 67; In re Cahill's Estate (1886) 12 VLR 228; and In the Estate of Dwyer (decd) (1886) 12 VLR 303
In re Howarth; Re Moylan; and In the Estate of Dwyer (decd)
(1893) 19 VLR 700
at 706
[2011] FCA 677 at [40]
[2013] FCA 355; (2013) 93 ACSR 606 at [58]
(1878) 10 Ch D 377
(1923) NZLR 58
(1931) 31 SR (NSW) 565
at 566
(1878) Ch D 377 at 380, 381
PS par 101(d)
[2010] NSWSC 247 at [81]-[121]
[2013] NSWSC 1162 at [7]
[2014] WASC 395 at [48]-[49]
[2017] NSWCA 234 at [51]
at [93]
at [101] to [103]
at [121]
See [232] above
DS par 2
PS par 109(f)
DS par 2
T39.43-41.34
T35.15-24
T85.38-86.15
T87.8-23
At [12.56]
(2007) 69 NSWLR 603; [2007] NSWCA 65
See [73] above
PS par 112
See [166] - [172]
PS par 122
Ps par 123
(1985) 160 CLR 583; [1985] HCA 78 at 618-619
27 February 2017 affidavit par 58.
Affidavit 27 February 2017 pars 24 and 25.
Affidavit 6 May 2017 par 96.
Affidavit 27 February 2017 par 28.
Affidavit 27 February 2017 pars 29 to 33.
Affidavit 6 May 2017.
Affidavit 27 September 2018 pars 41 to 43.
Affidavit 5 May 2017 par 76.
Affidavit 5 May 2017 par 83.
Affidavit 5 May 2017 par 88.
Affidavit 5 May 2017 pars 89 to 91.
Affidavit 1 February 2018 pars 6 to 19.
Exhibit P4.
T 101.50.
T 92.20.
T 100.22.
T 102.41, T 112.43.
T 104.30.
Court Book p 2467.
Court Book p 2337.
(1903) 3 SR (NSW) 375; 20 WN (NSW) 144. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 17 December 2021

Perry v Perry

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Judgment (40 paragraphs)

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Legislation Cited (10)

Cases Cited (48)

Cited By (3)