Plaintiff v Defendant

TRUSTS - Constructive trust - Common intention of plaintiff and defendant that plaintiff would be beneficial owner of the property - Plaintiff detrimentally relied upon common intention by paying purchase price of property - Defendant engaged in equitable fraud by failing to honour common intention.

ESTOPPEL - Deed estoppel - Instrument of transfer of land operated as deed between parties - Whether plaintiff estopped from leading evidence that he purchased the property the subject of the transfer of land - Transfer of land instrument did not constitute an unambiguous statement that the defendant had paid the full purchase price of the property - Plaintiff not estopped from leading evidence that he paid purchase price of property.

Transfer of Land Act 1958 s 40(2), Transfer of Land Amendment Act 2014 s 10, Evidence Act 2008 s 48(4).

1 In this proceeding the plaintiff Mr Tony Campana claims for a declaration of trust over property situated at 160 Union Street, Brunswick ('160 Union Street'). The current registered proprietor of 160 Union Street is Mr Campana's sister, Ms Elenia Censori, the defendant.

2 The events relating to the proceeding span nearly two decades. In 2005, Mr Campana was involved in the development of 160 Union Street and the adjoining lot at 162 Union Street as an owner-builder. Mr Campana alleges that in early 2005 he was told that he would be unable to obtain building permits for both properties owing to a restriction on permits for owner-builders. Mr Campana claims that, to circumvent this permit restriction, he entered into an agreement with Ms Censori under which she would be registered on the title of 160 Union Street and hold the property for his benefit. Mr Campana alleges that in 2005 he and Ms Censori signed a trust deed to give effect to this agreement.

3 Mr Campana's primary claim seeks to enforce the trust deed. The trust deed is not in evidence. All copies of the trust deed have been destroyed since 2005. In the alternative, Mr Campana claims relief under either a resulting or constructive trust. Mr Campana claims that if the Court finds that he is the beneficial owner of the property, Ms Censori must account to him for $182,097 received as rental income from the property.

4 Ms Censori denies ever signing a deed of trust in respect of 160 Union Street. Ms Censori contends that she paid the entirety of the purchase price for the property. By her counterclaim Ms Censori claims that she entered into an agreement with Mr Campana in late-2007, pursuant to which Mr Campana agreed to pay her $8,000 per month as repayment for a loan taken out over 160 Union Street. Ms Censori alleges that Mr Campana has failed to make any payments since 6 March 2014 and that he stands indebted to her for the sum of $816,360.56.

5 Mr Campana's claim based on an express trust fails because Ms Censori was not the owner of 160 Union Street when the trust deed was executed. Mr Campana does not have an interest under a resulting trust arising from the failure of the express trust because he did not hold any beneficial interest in 160 Union Street that could revert to him upon the failure of the express trust. Further, Mr Campana does not have an interest under a resulting trust arising from his contribution to the purchase of 160 Union Street or his voluntary transfer of the property to Ms Censori. Although the express trust deed failed, both Mr Campana and Ms Censori intended to create a trust. As such, a presumption of resulting trust cannot arise.

6 By entry into the trust deed Mr Campana and Ms Censori formed a common intention that Mr Campana would at all times be the beneficial owner of 160 Union Street. He detrimentally relied on this common intention by paying the entire purchase price for 160 Union Street. Ms Censori has engaged in equitable fraud by failing to honour the common intention of the parties. Mr Campana has a beneficial interest in 160 Union Street pursuant to a common intention constructive trust. Ms Censori has held 160 Union Street as trustee for Mr Campana's benefit from 31 May 2005. Ms Censori is liable to account to Mr Campana for $182,097 received by her as rental income from the property.

7 Ms Censori's counterclaim is dismissed. The counterclaim is premised on Mr Campana having failed to clear the debit balance of a loan for $464,000 drawn down against 160 Union Street in October 2007. Mr Campana cleared the debit balance in March 2014. The counterclaim is without foundation.

8 Before addressing Mr Campana's claim for a declaration of trust over 160 Union Street, it is necessary to address Ms Censori's objection to the admissibility of certain evidence led by Mr Campana. Mr Carew, who appeared for Ms Censori, submitted that Mr Campana is estopped from leading evidence disputing Ms Censori's claim that she bought 160 Union Street in her own name using her own funds. The estoppel is said to arise from the text of the consideration panel on a transfer of land signed by Ms Censori and Mr Campana in respect of 160 Union Street, dated 31 May 2005, which reads:

Firstly to rectify an error as error as C/T 10858-706 was incorrectly transferred and the sum of one hundred and thirty thousand dollars ($130,000) paid pursuant to a contract of sale dated 8th December 2004 between Avamax Pty Ltd and Elenia Censori.

Mr Carew submits that pursuant to s 40(2) of the Transfer of Land Act 1958, the transfer document is deemed to be a deed between Mr Campana and Ms Censori. He submits that deed estoppel applies to the matters recited within the 31 May 2005 transfer precluding the admissibility of evidence inconsistent with the matters recited in the 31 May 2005 transfer.

9 As at 31 May 2005, s 40(2) of the Transfer of Land Act 1958 read as follows:

(2) Every instrument when registered shall be of the same efficacy as if under seal and shall be as valid and effectual to all intents and purposes as a deed duly executed and acknowledged or other appropriate form of document.

Section 40(2) was repealed in 2014 by s 10 of the Transfer of Land Amendment Act 2014.

10 The repeal of legislation by Parliament will not 'affect the previous operation of that Act or provision or anything duly done or suffered under that Act or provision', unless the repealing statute expressly discloses a contrary intention.[1] Section 10 of the amending legislation does not disclose an intention to affect the previous operation of s 40(2). The 31 May 2005 transfer operates as a deed between the parties.

11 Mr Carew submits that, once it is accepted that the 31 May 2005 transfer takes effect as a deed, deed estoppel applies to prevent Mr Campana from disputing that Ms Censori bought 160 Union Street in her own name and with her own funds.[2] Mr Carew relies on the statement from the House of Lords in Greer v Kettle:[3]

Estoppel by deed is a rule of evidence founded on the principle that a solemn and unambiguous statement or engagement in a deed must be taken as binding between parties and privies and therefore as not admitting any contradictory proof.[4]

12 In order to support an estoppel, the statement contained in a deed must, when considered in context of the deed as a whole be 'precise, clear and unambiguous'.[5] In Caboche v Ramsay,[6] the Full Court of the Federal Court stated the requirement for unambiguity as follows: 'because an estoppel precludes the assertion of the truth, the mis‑recital must be clear and certain and not requiring argument or inference'.[7]

13 The statement in the 31 May 2005 transfer 'the sum of one hundred and thirty thousand dollars ($130,000) paid pursuant to a contract of sale dated 8th December 2004 between Avamax Pty Ltd and Elenia Censori' does not recite that Ms Censori herself paid the $130,000 to Avamax. Mr Carew did not seek to argue to the contrary.[8] The statement does not support an estoppel which precludes Mr Campana from adducing evidence disputing Ms Censori's account of having paid Avamax $130,000 for the purchase of 160 Union Street.

14 Further, even if the statement were unambiguous, deed estoppel would not apply. The doctrine of deed estoppel does not prevent a party from contradicting facts recited in a deed for all purposes. Deed estoppel only arises in respect of an action on the deed to enforce rights arising thereunder. Deed estoppel does not apply to an action brought on a collateral transaction.[9] Mr Campana does not make a claim in respect of his rights under the 31 May 2005 transfer. Rather he seeks to enforce a trust deed under which Ms Censori holds 160 Union Street for his benefit. Alternatively, he claims a beneficial interest in the property pursuant to a resulting or constructive trust.

15 Mr Campana's primary claim rests on an express trust deed entered into by the parties under which Ms Censori would hold 160 Union Street on trust for his benefit. Ms Censori denies ever signing a trust deed or declaring a trust over the property. A copy of the trust deed is not in evidence. Mr Campana gave evidence that his copy of the trust deed was destroyed in a fire at a property at which he was residing in April 2014.[10] Mr Madafferi, the solicitor who allegedly drafted the trust deed, gave evidence that a copy of the trust deed retained by him was likely to have been destroyed in a substantial fire at his office in 2007.[11]

16 Section 48(4) of the Evidence Act 2008 states:

A party may adduce evidence of the contents of a document in question that is not available to the party, or the existence and contents of which are not in issue in the proceeding, by -

...

(b) adducing from a witness evidence of the contents of the document in question.

17 There are authorities which support the proposition that proof of the existence and terms of a lost trust deed requires 'clear and convincing proof'.[12] The Court of Appeal has recently rejected the clear and convincing proof test:

There can be no doubt about the end result here: the clear and convincing test of the proof of the contents of a lost document (whatever its nature) is misconceived. Rather, in terms of proof of a particular fact or facts (or inferences to be drawn from them) relating to the existence or contents of a document, the burden upon the party attempting to establish that fact is no more and no less than that imposed by s 140 of the Evidence Act - proof on the balance of probabilities, as elaborated upon in the section itself.[13]

18 Accordingly, it is necessary to consider the totality of the evidence in order to determine on the balance of probabilities whether Mr Campana and Ms Censori executed a deed of trust with Mr Campana as the beneficiary. If so, it is then necessary to determine on the balance of probabilities whether the terms of the trust, in particular the description of the subject matter of the trust, are sufficiently certain to constitute a valid trust.

Events Preceding the Purchase of 160 Union Street

19 Mr Campana was released from jail in May 1994. He initially lived with his brother Leo, but after approximately six weeks moved into Ms Censori's residence at 32A Brunei Crescent, Heidelberg.[14] Mr Campana lived with Ms Censori until he moved to Sydney in December 1994.[15] While living in Sydney Mr Campana worked at a restaurant.[16] Mr Campana received approximately $40,000 upon the sale of that business.[17] In February 1996, he returned to Melbourne.[18]

20 Between November 1996 and September 1997, Mr Campana lived in Queensland and worked in his brother Alessio's carpet-laying business.[19] Mr Campana invested $80,000 in his brother's business[20] which was repaid when he ceased employment in the business.[21] The $80,000 was paid into the trust account of Chiodo Madafferi lawyers by Alessio.[22] Mr Mark Madafferi, a solicitor and principal at Chiodo Madafferi, was directed by Alessio to hold the money for Mr Campana.[23]

21 Mr Madafferi and Mr Campana gave evidence that, in around 1998, Mr Madafferi introduced Mr Campana to his client Mr Frank Chiarella, a builder and the sole director of Avamax Pty Ltd ('Avamax').[24] Mr Campana loaned the $80,000 which had been deposited into the Chiodo Madafferi trust account to Mr Chiarella, which he used to finance a building project in Fitzroy.[25]

22 In 2001, Mr Campana worked on a residential development project at Pigdon Street, Carlton.[26] Mr Campana gave evidence that Mr Chiarella and Mr Steve Manago also had a financial interest in the project.[27] Mr Campana invested $170,000 in the Pigdon Street project, being the proceeds from the sale of a milk factory in Hawthorn. Mr Campana had purchased the factory from a mortgagee in possession and then renovated it for resale.[28] At the conclusion of the Pigdon Street project in around 2005, 1/200 Pigdon Street was transferred to Sarah Rogers who at the time was Mr Campana's domestic partner.[29]

23 In 2004, Avamax was undertaking a 10-lot subdivision at Union Street, Brunswick.[30] Mr Campana became interested in purchasing two of three vacant blocks at 160, 162 and 164 Union Street, with a view to building two adjacent townhouses.[31] On 9 May 2005, Mr Campana became the registered proprietor of 160 Union Street by way of transfer from Avamax.[32] On 31 May 2005 Mr Campana transferred the legal title to Ms Censori.[33] The parties disagree as to the circumstances leading to the transfer of the legal title in 160 Union Street to Ms Censori, and whether the circumstances give rise to a trust in favour of Mr Campana.

24 Mr Campana gave evidence that in January 2005 he told Ms Censori he intended to purchase 160 and 162 Union Street and offered her the option to buy 164 Union Street. Ms Censori was not interested because she was living in subsidised housing in Heidelberg and thought the Union Street lots were too small.[34]

25 Mr Campana gave evidence that he decided to go ahead with the purchase of 160 and 162 Union Street.[35] Due to insufficient finance Mr Chiarella had not yet completed the capital works necessary to obtain a plan of subdivision, and was therefore unable to transfer lots into Mr Campana's name.[36] In March 2005 Mr Campana agreed to lend Mr Chiarella $132,500 for the completion of the capital works.[37] The source of the $132,500 was funds in Mr Madafferi's trust account and part of $550,000 raised by Sarah Rogers by way of mortgage over 1/200 Pigdon Street.[38] Mr Campana gave evidence that the $132,500 loan was repaid by Mr Chiarella into the trust account of Chiodo Madafferi Solicitors, from which it was applied as a deposit on the purchase of 160 and 162 Union Street.[39] The trust account of H Albert Nominees Pty Ltd, mortgagee of 160 and 162 Union Street,[40] records a payment of $132,500 from Chiodo Madafferi Solicitors on 18 April 2005 described as an 'amount received from Chiodo Madafferi on account of settlement moneys for Lots 2 & 3'.[41] Mr Campana stated that in exchange for his $132,500 capital works contribution Mr Chiarella reduced the price of each of the two lots from $210,000 to $205,000.[42]

26 As examined further below, Mr Campana alleges that when he sought to apply for building permits in respect of 160 and 162 Union Street he was told by the building surveyor that he would be unable to obtain permits for both 160 and 162 Union Street due to changes to building laws which limited the grant of a permit to owner‑builders to one every three years.

27 Mr Campana and Mr Chiarella gave evidence that they discussed the difficulty Mr Campana faced in obtaining building permits.[43] Mr Chiarella suggested to Mr Campana that a solution could be to register someone else on title for 160 Union Street, and that they discussed the possibility of registering Ms Censori.[44] Mr Campana and Mr Madafferi gave evidence that after Mr Campana discovered the change to the building laws, they discussed whether it would be possible for Ms Censori to be nominated as purchaser and to go on title.[45]

28 Mr Campana and Mr Chiarella gave evidence that they visited Ms Censori's home to discuss registering her on title. They stated that in order to convince Ms Censori to allow herself to be registered on title, Mr Chiarella explained that the footprint of 160 Union Street would be larger than that of Brunei Crescent.[46] Mr Campana gave evidence that if it were necessary to raise finance against the security of 160 Union Street, it would be Ms Censori who would have to apply for a mortgage. He assured her that she would be the mortgagor 'in name only' and that he would cover all expenses.[47] Mr Campana gave evidence that Ms Censori was not interested in being registered on title or moving into 160 Union Street because she did not want to become financially responsible for the property.[48]

29 Mr Campana gave evidence that he visited Ms Censori again the next day.[49] He explained that if he remained registered on the titles of both 160 and 162 Union Street and was unable to obtain building permits, he would lose the money that he had put into the Union Street project.[50] He told her that she could live in the property rent‑free.[51] He told her that he could afford to buy the property outright, would cover all expenses, and would borrow the minimum amount needed if it became necessary for him to do so. He also told her that she would retain the right to sell the property if he defaulted on the mortgage repayments.[52] Mr Campana gave evidence that Ms Censori agreed to this proposal.[53]

30 Ms Censori gave evidence that in November 2004 Mr Campana explained to her that he had an opportunity to purchase lots at Union Street and asked whether she would be interested in purchasing one of the lots.[54] Mr Campana told her he was owed money by Mr Chiarella who would sell him lots from the Union Street development 'on the cheap.'[55] Mr Campana told her 'you put a roof over my head when I came out and, you know, you've been good to me and this is my way of repaying you'.[56] She said that she was not interested in purchasing a lot.[57]

31 Ms Censori gave evidence that Mr Campana made regular social visits to her home in late 2004 and early 2005. Over the course of approximately three or four further discussions Mr Campana convinced her to purchase a lot at Union Street.[58] Most of the discussions took place at her home.[59] Ms Rogers was present for one or two of the discussions.[60] Mr Campana described the purchase of a lot at Union Street as a 'really good deal' because her two children would have their own bedrooms.[61] Around March 2005, Mr Campana and Ms Rogers visited her home and Ms Rogers convinced her to purchase a lot at Union Street, because they were friends and would be neighbours.[62] Mr Campana told her the price of the lot would be approximately $225,000.[63] She agreed to purchase.

i. The signed contract of sale for 160 Union Street is not in evidence. However, two draft contracts of sale for the property, undated save for a reference '2004', with Avamax Pty Ltd as vendor are in evidence.[64] Under one of those contracts Ms Censori is identified as the purchaser.[65] Under the other contract Mr Campana is identified as the purchaser.[66]

ii. By a transfer of land dated 9 May 2005, Mr Campana became the registered proprietor of 160 Union Street.[67] On 31 May 2005, a second transfer of land was lodged which transferred the property from Mr Campana to Ms Censori. The 31 May 2005 transfer is signed by both Mr Campana and Ms Censori. The document notes the consideration for the transfer as:

Firstly to rectify an error as error as C/T 10858-706 was incorrectly transferred and the sum of one hundred and thirty thousand dollars ($130,000) paid pursuant to a contract of sale dated 8th December 2004 between Avamax Pty Ltd and Elenia Censori.[68]

33 Mr Campana gave evidence that the contract of sale for 160 Union Street was signed on either 18 April 2005[69] or 8 December 2004.[70] His evidence was that there was no contract of sale between Ms Censori and Avamax,[71] and that Ms Censori appeared on the contract of sale solely in her capacity as nominee.[72]

34 Ms Censori gave evidence that she did not agree to purchase the property until at least March 2005. However, she also gave evidence that she signed the contract of sale for the property at Mr Madafferi's office on 8 December 2004. When challenged on this inconsistency, Ms Censori conceded that she 'can't really remember when [she] signed the contract'.[73]

35 Mr Madafferi acted for Avamax and Mr Campana in the sale of the property. His evidence is that Mr Campana signed contracts of sale for both 160 and 162 Union Street.[74] It was not put to him in cross-examination that this evidence was false. He denied that Ms Censori signed a contract prepared by his firm for the purchase of 160 Union Street from Avamax. His evidence, which I accept, is that Mr Campana signed a contract for the purchase of 160 Union Street and Ms Censori subsequently signed a nomination form which he had prepared under which she agreed to be registered as proprietor of 160 Union Street.[75] Mr Madafferi did not have a clear recollection as to the timing of the signing of the contracts of sale. However, he had a clear recollection that Mr Campana had signed the contracts of sale prior to the declaration of trust being signed by the parties.[76]

36 I place little weight on the undated draft contract which identifies Ms Censori as the purchaser of 160 Union Street. To the extent that Ms Censori relies upon the draft contract it is inconsistent with her own evidence that she agreed with Mr Campana in March 2005 to purchase 160 Union Street. The purchase price of $130,000 recorded in the contract is inconsistent with the evidence of Mr Chiarella and Mr Campana that the purchase price of 160 Union Street was $205,000. It is also inconsistent with her own evidence that the purchase price was $225,000.[77] Further the undated draft contract is inconsistent with the evidence of Mr Madafferi, which I accept, that Mr Campana signed contracts prepared by his firm for the purchase of 160 and 162 Union Street.

37 Mr Madafferi was called by the plaintiff to give evidence. Mr Madafferi has practised as a solicitor for 43 years.[78] He is the principal of Christopher William Legal, which was formerly known as Chiodo Madafferi. Mr Madafferi first met Mr Campana in 1998. That year Mr Madafferi introduced Mr Campana to Mr Chiarella. Since 1998, Mr Madafferi has undertaken work as Mr Campana's solicitor on a number of transactions. He has acted as his solicitor on various conveyancing matters, in debt disputes, and in Mr Campana's separation from Ms Rogers.[79] Mr Chiodo, who ran Chiodo Madafferi's criminal practice also undertook work for Mr Campana.

38 Mr Madafferi last acted as Mr Campana's solicitor in 2013, when Mr Campana sold 162 Union Street. Since then, Mr Madafferi and Mr Campana have had an acrimonious relationship. On 8 June 2016, Mr Campana instituted proceedings in the Professional Liability List of this Court against Mr Madafferi. The pleadings alleged serious professional misconduct by Mr Madafferi and claimed damages of over $6.7 million.[80] The allegations levelled by Mr Campana prompted an investigation by the Victorian Legal Services Board into Mr Madafferi.[81] Mr Campana's case against Mr Madafferi ultimately settled in early 2020 on a confidential basis, with no admission as to liability.

39 In mid-2016, Mr Campana arranged a meeting between Ms Censori, himself and a solicitor, Mr Michael Gaylard. Mr Campana was attempting to convince Ms Censori to initiate proceedings against Mr Madafferi alleging professional negligence in his handling of various dealings between Ms Censori and Azurn International.[82] Mr Madafferi recalls receiving a letter of demand from Ms Censori.[83] However, Ms Censori did not proceed with litigation against Mr Madafferi.

40 Although he was called to give evidence on behalf of Mr Campana, on no view could it be said that Mr Madafferi was in Mr Campana's camp. Mr Madafferi is a truly independent witness. He had no reason not to tell the truth. It was not even faintly suggested by Mr Carew in the course of cross-examination or in final submissions that Mr Madafferi had any motive to give false evidence. Over the course of the two days in which he gave evidence, Mr Madafferi was an impressive witness. Mr Madafferi gave his best recollection of the events the subject of this proceeding and appropriately qualified his evidence when necessary. Although the events which were the subject of Mr Madafferi's evidence date back to 2004/2005, Mr Madafferi had a credible and clear recollection of these events.

41 Mr Madafferi's evidence conflicts with Ms Censori's evidence in respect of the following matters:

• Whether Mr Campana sought Ms Censori's agreement to be registered as owner of 160 Union Street as a result of Mr Campana's inability to obtain a building permit for 160 Union Street;
• Whether Mr Madafferi attended Ms Censori's home in Heidelberg to try and persuade her to go on title of 160 Union Street and hold the property on trust for Mr Campana;
• Whether Ms Censori signed a contract to purchase 160 Union Street;
• Whether Ms Censori signed a nomination agreement under which she agreed to be registered on title of 160 Union Street;
• Whether Ms Censori gave Mr Madafferi $50,000 in cash to go towards the purchase of 160 Union Street;
• Whether Ms Censori signed a trust deed under which she agreed to hold 160 Union Street for Mr Campana's benefit.

Whilst Mr Madafferi had no motive to be anything other than a truthful witness, the same cannot be said of Ms Censori. Ms Censori had a motive for giving evidence which would maximise her prospects of retaining ownership of 160 Union Street. Further, as set out later in this judgment, her evidence regarding the source of funds she claims to have used for the purchase of 160 Union Street was quite implausible.

42 Ms Censori's evidence regarding her agreement with Mr Campana to purchase 160 Union Street and the circumstances in which she claims to have provided $14,000 in cash to Ms Manago was corroborated by Mr Campana's former partner Sarah Rogers.[84] I reject Ms Rogers' evidence. Ms Rogers was not an independent witness. Ms Rogers and Ms Censori are long-term friends.[85] Both Mr Campana and Ms Rogers gave evidence that their separation was not amicable.[86] Ms Rogers obtained two intervention orders against Mr Campana in 2009 and 2020 respectively.[87] During the course of her evidence her memory of events was poor and she struggled to recall dates with accuracy.[88] Ms Rogers first turned her mind to the events of 2005 in 2020 when Ms Censori approached her about being witness.[89] At that time they discussed their respective recollections of past events.[90] I do not consider Ms Rogers had an independent recollection about the matters on which she gave evidence. Wherever the evidence of Ms Censori conflicts with Mr Madafferi, I prefer Mr Madafferi's evidence to that of Ms Censori.

43 It is common ground that in March/April 2005 when Mr Campana applied for, and was granted, a building permit in respect of 162 Union Street, Parliament had passed an amendment to the Building Act 1993 which limited the grant of a permit to owner‑builders to one every three years.[91] However, while the amending Act had been enacted, the restriction on permits to owner-builders did not come in to force until 14 June 2005.[92] It is also common ground that a building permit was issued to Ms Censori in respect of 160 Union Street on 8 April 2005.[93] As such, there was no legal impediment at that time to prevent Mr Campana being issued with a building permit as an owner-builder.

44 Mr Campana gave evidence that in late March or early April 2005, he visited the office of a building surveyor, Mr Theo Alexopoulos, and applied for permits in respect of both 160 and 162 Union Street. By that time, substantial preparatory works had been undertaken at the properties to ready them for development.[94] Within 'a day or so' of applying for the building permits, Mr Alexopoulos called Mr Campana to inform him that 'there's been changes to the Building Act and... you can't have a permit as an owner‑builder for two buildings'.[95]

45 Mr Campana gave evidence that following the rejection of the permit application he spoke with Mr Chiarella. Mr Campana gave evidence that Mr Chiarella could not himself apply for the permit as he did not have a builder's licence. On Mr Campana's account, Mr Chiarella then raised the suggestion that the property be put in someone else's name to avoid the building permit restriction.[96] Mr Campana thereafter called Mr Madafferi and asked him for advice regarding putting the property in another's name. He did not ask Mr Madafferi for any legal advice regarding the existence or effect of the building permit restriction.[97]

46 On Mr Campana's account, after Ms Censori agreed to be put on the title to the property, he called Mr Madafferi's office and instructed the receptionist to reapply for a permit from Mr Alexopoulos.[98] The permit was issued 'a week or so after'.[99]

47 Mr Madafferi's evidence regarding the denial of the permit differs slightly from Mr Campana's. On Mr Madafferi's account, Mr Campana first raised the issue of his inability to obtain a building permit in either January or February 2005.[100] Consistent with Mr Campana's account, Mr Madafferi did not refer Mr Campana to a building law specialist for advice, nor does he recall researching the building permit restriction himself.[101]

48 Mr Chiarella corroborated Mr Campana's evidence as to his inability to obtain a building permit. Due to an error on the part of the transcript provider, not all of Mr Chiarella's evidence was recorded. My note of the relevant apart of Mr Chiarella's evidence is as follows:

He recalls the change in legislation in September 2004 which prevented an owner‑builder from doing more than one development in three years. He recalls TC [Mr Campana] being very upset when told by his building surveyor that he couldn't get a building permit. He recalls a solution being to get Elaine Censori to go on title for 160. He attended at Elaine's house in Heidelberg with TC when TC was trying to persuade Elaine to go on title. FC [Mr Chiarella] had the plans for the townhouse and explained to Elaine that the townhouse would have a larger footprint than her present house. After TC saw the architect - Max Michelli - he told FC that he couldn't get a building permit as an owner builder.

49 Mr Alexopoulos was called to give evidence. He had no specific recollection of 160 Union Street or of the events surrounding the issue of the permit to Ms Censori on 8 April 2005.[102] He said it was likely he would have been alerted to any legislative changes such as the building permit restriction,[103] but that he could 'only apply the regulation or legislation at the time that affects the building permit at that time'.[104]

50 I accept Mr Campana's evidence that he was told that he would not be able to get a building permit for 160 Union Street as an owner-builder. His evidence is corroborated by both Mr Madafferi and Mr Chiarella. Mr Madafferi had a clear recollection of being told by Mr Campana that he could not get a building permit. His evidence was that Mr Campana had been told this by someone in Carlton who later committed suicide.[105] Both Mr Madafferi and Mr Chiarella gave evidence that Mr Campana had been told that he would not be able to get a building permit as an owner‑builder. Whether the source of that advice was Mr Michelli or Mr Alexopoulos is not decisive. I accept the evidence of Mr Madafferi that having been told by Mr Campana that he could not obtain a building permit he discussed with Mr Campana and Ms Censori the option of Ms Censori being registered on title as owner as a means of overcoming the problem. I accept Mr Chiarella's evidence that he also discussed the possibility of Ms Censori being registered on title of 160 Union Street and attended at her premises in Heidelberg with Mr Campana to try and persuade her to do so.

51 The amendments to the Building Act which precluded Mr Campana from obtaining a building permit had been enacted but were not in force in April 2005. It is plausible that in early 2005 either or both of Mr Michelli and/or Mr Alexopoulos would not have appreciated that the amendments had not come into effect and advised Mr Campana that he could not obtain a building permit.

52 Mr Carew submitted that the court should conclude that:

i. There was no legal impediment to Mr Campana obtaining a building permit as an owner‑builder of 160 Union Street;

ii. There was no justification for Ms Censori to be placed on the title of 160 Union Street to circumvent a non-existent legal impediment to Mr Campana being issued with a building permit;

iii. As Mr Campana's claimed justification for placing Ms Censori on the title of 160 Union Street did not exist, the court should accept her evidence that she was a bona fide purchaser of 160 Union Street.

53 I accept Mr Carew's submission as set out at (i) and (ii) above. However, accepting (iii) requires the court to reject the evidence not only of Messrs Campana and Chiarella, but also Mr Madafferi. No credible submission has been advanced as to why I should reject Mr Madafferi's evidence:

i. that he was told by Mr Campana that he could not obtain a building permit as an owner‑builder for 160 Union Street;

ii. that he discussed with Mr Campana the option of placing Ms Censori on the title of 160 Union Street to overcome the restriction on his ability to obtain a permit;

iii. that he then discussed this option directly with Ms Censori sometime between December 2004 and February 2005.

54 These are not matters about which Mr Madafferi could have had a mistaken recollection. A rejection of his evidence would require a finding that he gave deliberately false evidence. A finding that Mr Madafferi has given deliberately false evidence could have serious repercussions for him as a practising solicitor. This is a matter which I have taken into account when considering Mr Madafferi's evidence.[106]

55 I accept Mr Madafferi's evidence that he was told by Mr Campana that he was unable to obtain a building permit as an owner‑builder for 160 Union Street. I also accept his evidence that he had discussions with Mr Campana and Ms Censori about placing Ms Censori on the title of 160 Union Street as a means of circumventing Mr Campana's inability to obtain a building permit. I accept Mr Campana's evidence that the catalyst for placing Ms Censori on the title of 160 Union Street was the advice he received that he could not obtain a building permit as an owner‑builder for 160 Union Street. The counterfactual advanced on behalf of Ms Censori is that Mr Campana's proposal that she purchase 160 Union Street involved an act of goodwill on his part. Her evidence was that Mr Campana acted 'out of character' by proposing something which was in her interest.[107] I reject this counterfactual. Registering Ms Censori on title enabled Mr Campana to circumvent a restriction which he believed prevented him from obtaining a building permit as an owner‑builder. The subsequent execution of the trust deed ensured that he retained beneficial interest in the property.

Sums alleged to have been advanced by Ms Censori to Mr Campana

56 A key issue for determination in the present proceeding is whether 160 Union Street was purchased by Mr Campana or Ms Censori. Ms Censori alleges that the funds for the purchase and construction of 160 Union Street were advanced to Mr Campana over a number of years. There are six advances totalling approximately $225,000 which Ms Censori says comprise the payments for the purchase and construction of the property:

i. A loan to Mr Campana of $12,000 cash in 1995;

ii. A loan to Mr Campana of $40,000 cash in 1998;

iii. A cheque for $38,723.45 endorsed to Mr Campana in May 2005;

iv. $50,000 cash handed to Mr Madafferi in the latter half of 2005;

v. $14,000 cash handed to Ms Cathy Manago in July 2005;

vi. $69,200 drawn down on an ANZ Loan Account in Ms Censori's name on 22 July 2005.

Loans of $12,000 and $40,000 to Mr Campana in 1995 and 1998

57 Ms Censori alleges that in 1995 she loaned Mr Campana $12,000. Ms Censori contends that Mr Campana approached her in her home at Brunei Crescent in March or April of 1995 and asked for a $12,000 in order to facilitate a deal. Ms Censori agreed to loan him the money on the condition that he would repay her within two weeks. Ms Censori did not pursue Mr Campana for repayment of the funds after he failed to repay her within two weeks.[108]

58 Ms Censori alleges that, three years later in 1998, Mr Campana requested a further loan of $40,000 in cash. Ms Censori recalled the circumstances of the request as follows:

[M]y mother had had a stroke in 1998 and we were at my mum's property, there was me, Sarah and Eris, and as we were walking out he asked me whether I had any money, and I reluctantly said yes and he asked me if I had $40,000.[109]

59 At that point in time, Ms Censori had not been repaid the $12,000 loan, but agreed to loan Mr Campana a further $40,000. Within a day or two of Mr Campana making the request at their mother's house, Mr Campana visited Ms Censori's house at Brunei Crescent and helped her access the $40,000 cash by moving the bookshelf behind which she stored her savings. There was no discussion about when the money would be repaid.[110]

60 Mr Campana denies receiving either the $12,000 or $40,000 from Ms Censori.[111]

61 Ms Censori gave evidence regarding her income during the period in which it is said that she advanced $52,000 cash to Mr Campana. In 1995, Ms Censori was working part‑time as a cleaner for Almarays. She worked 20 hours per week at a rate of $20 per hour.[112] She had also been receiving maintenance payments of $100 per week from her former partner, Mr Ambesi,[113] as well as various social security payments.[114]

62 Ms Censori gave evidence that Mr Ambesi had failed to make his maintenance payments for an entire year in the period between 1989-93. Evidence was led of a signed note recording that Mr Ambesi owed her a total of $15,000, comprising $5,000 in owing maintenance payments and $10,000 that Ms Censori had loaned him. The note records an agreement by Mr Ambesi to 'pay these debts by way of $400 per month until the total $15,000 had been repaid. First payment being July 1993'.[115] Ms Censori gave evidence that Mr Ambesi had paid off the debt in full shortly after authoring the note in July 1993.[116]

63 Ms Censori's two children were born in 1988.[117] Ms Censori and her children moved into the Brunei Street house in 1992. As the property was a housing commission house, her rental payments were only $40 per week.[118] Prior to moving into the Brunei Street house, Ms Censori lived with her mother for three and half years. While living there, her mother did not charge her rent and covered her children's expenses, including food.[119] There is no documentary evidence such as tax returns or bank statements which verifies Ms Censori's income in the period 1995 to 1998.

64 I do not accept Ms Censori's evidence that she had $52,000 in cash to loan to her brother. Based on her evidence as to her sources of income it is unlikely that, as a sole parent with responsibility for the upbringing of two children, Ms Censori would have been able to save such a significant sum of cash. Ms Censori's evidence that she was 'a very good saver'[120] is not a plausible explanation for the accumulation of tens of thousands of dollars. Further, if contrary to this finding, Ms Censori had loaned $52,000 to Mr Campana, there remains the question of why he would have agreed in 2005 to repay $52,000 by that sum being applied towards her purchase of 160 Union Street. On Ms Censori's account, Mr Campana did not repay the $12,000 loan within two weeks as had been agreed. Her evidence was that she did not ask for repayment of the loan because 'she was scared to bring it up'.[121] She assumed he would repay the money 'at some point'.[122] Ms Censori agreed to advance a further $40,000 in 1998 without any discussion as to when the money would be repaid. She was prepared to advance a further $40,000 even though the original $12,000 had not been repaid because 'Eris is not a person you can - you can say no to... he can be intimidating'.[123]

65 Prior to his release from jail in 1994 Mr Campana served a lengthy prison sentence for murder. I accept Ms Censori's evidence that he could be an intimidating individual. Nevertheless, it is unlikely that, nearly ten years after he borrowed $12,000 and seven years after he borrowed $40,000, Mr Campana would have decided to repay these loans by agreeing that the $52,000 he borrowed be applied towards the purchase of 160 Union Street. If Mr Campana had entered into such an arrangement, he would himself have had to contribute $52,000 towards the purchase of 160 Union Street. I do not accept Ms Censori's evidence that she loaned $52,000 to Mr Campana which he subsequently agreed could be applied by her towards the purchase of 160 Union Street.

66 Ms Censori claims that in 2005 Mr Campana directed her to give $14,000 in cash to Ms Cathy Manago. Ms Censori alleges that the $14,000 was to be applied towards the purchase of 160 Union Street.

67 Ms Manago is the wife of Mr Steve Manago, a business associate of Mr Campana who had worked with him on the Pigdon Street development alongside Mr Chiarella.[124] Mr Manago also attended school with Ms Censori.[125] Between November 2004 and February 2006, Ms Manago lived next door to the house owned by Mr Campana and Ms Rogers on Pigdon Street. Ms Rogers recalls knowing Ms Manago 'very well'.[126]

68 Ms Censori gave evidence that she received a call from Mr Campana during which he asked her to give $14,000 to Ms Manago which he would later pickup from her.[127] The timing of this request is unclear. In her defence, Ms Censori alleged that the request was made in May 2005.[128] However, in evidence Ms Censori stated that the request was made in July 2005.[129] Ms Censori attended Ms Manago's house with Ms Rogers.[130] Ms Rogers gave evidence that she attended Ms Manago's house with Ms Censori and that Ms Censori handed Ms Manago money wrapped in foil and told her it was $14,000.[131] Ms Rogers could not recall when these events took place.[132]

69 Mr Campana denies ever providing any direction to Ms Censori to give money to Ms Manago.[133] Ms Manago denies ever having received money from Ms Censori.[134] Ms Manago gave evidence that, to her knowledge, Ms Censori had never entered her house on Pigdon Street.[135]

70 I do not accept Ms Censori's evidence that she provided Ms Manago with $14,000 in cash which was to be applied towards the purchase of 160 Union Street. Ms Censori provided no explanation for why Mr Campana directed her to provide $14,000 cash to Ms Manago rather than delivering the funds directly to Mr Campana. There was no evidence before the Court to suggest that either Ms Manago or her husband were involved in the Union Street development. In addition, by July 2005 when Ms Censori says she provided the funds to Ms Manago, an ANZ loan account of $80,000 had been drawn down for the purpose of the fit-out of 160 Union Street. I do not consider there to be any basis for concluding that Ms Manago was being untruthful when she gave her evidence. I accept Ms Manago's evidence that she did not receive any cash from Ms Censori at any point in time.

71 I reject Ms Rogers' evidence that she was present and observed Ms Censori hand Ms Manago $14,000 in cash. For the reasons set out earlier in this judgment I do not consider Ms Rogers to be an independent witness.

72 Ms Censori alleges that Mr Campana requested her to provide Mr Madafferi with $50,000 cash. Ms Censori recalls having the following conversation with Mr Campana:

Ms Censori: Eris rang me and said to me if I had any more money and, um, I said, 'Yeah. How much?' Or no, rather I said, 'Yeah', um, and he goes, 'Have you got 50?' and I reluctantly said yes and he goes, 'Can you do me a favour, can you drop it off to Mark Madafferi's place'.[136]

...

Mr Carew: Why was he asking you to do that?

Ms Censori: Oh, this was part of the building of Union Street.[137]

73 Ms Censori's defence pleads that this request took place in May 2005.[138] However, in the course of her evidence, Ms Censori denied that the request was made in the first half of the year and stated that the $50,000 was handed to Mr Madafferi 'later on in the year'.[139]

74 The day after receiving the phone call from Mr Campana, Ms Censori collected the money and went down to Mr Madafferi's office. Once there, Mr Madafferi 'ushered [her] into like a conference room and we sat across each other and we counted it'.[140] This account is inconsistent with Ms Censori's evidence about her interactions with Mr Madafferi:

Mr Carew: How many times do you think you met Mr Madafferi in 2005 in respect of 160 Union Street?---

Ms Censori: I didn't. The only time I met Mark was if I went down there to sign papers, and a lot of the times, he was not there, or was upstairs.[141]

Mr Madafferi denies ever receiving any cash from Ms Censori.[142]

75 Mr Campana similarly denies ever having directed Ms Censori to make such a payment to Mr Madafferi. Mr Carew put to Mr Campana that he knew that Ms Censori had provided Mr Madafferi $40,000 cash that was applied towards the purchase of the house. This proposition was based on an email Mr Campana sent to Ms Censori on 20 November 2019. In the email, Mr Campana stated:

I am going to Court against Mark next year. U [sic] gave Mark $40,000 in cash towards the end of 05. This evidence may b [sic] relevant.[143]

76 The email was sent by Mr Campana in the context of his litigation against Mr Madafferi. The email's subject line reads: CENSORI: NOTICE TO SUPOENA [sic] EVIDENCE. In the body of the email, Mr Campana states:

The reason for this request is that I am required to provide the Defense [sic] with a list of witnesses I propose to call, and a summary of the evidence each witness will give. To satisfy this duty and because I am self represented, it is necessary that I depose each witness. Should I fail to call a witness the Court deems relevant, the Court may draw an inference against my interests.

This e mail serves to inform you that I will put your name on my witness list. You will be subpoened [sic] to attend Court and thereby compelled to give your evidence. I will provide the Defense [sic] with a summary of your evidence as you recounted it to me some three years ago.[144]

77 Mr Campana's gave evidence that the email recounted a conversation with Ms Censori in 2016 in which she had told him that she had handed Mr Madafferi $40,000 in cash. Mr Campana provided the following context:

I was litigating with Mark to take it to court, um, over negligence, and I needed to chase down $40,000 that I'd given him in relation to a loan, a short-term loan. And I couldn't find any documentation, so I wrote to the defendant about that matter because I thought maybe that's the $40,000. Then later on subsequently I found, ah, evidence that went to 2006, when the loan was, ah, was issued. Mark didn't produce a contract, and without the contract it was hard for me to date when, ah, this money had gone over, but I eventually found it.[145]

78 Mr Campana said that Ms Censori's evidence of the $40,000 was relevant to the issue of 'whether or not I paid Mr Madafferi for... the loan to Prem'.[146] This is consistent with the statement of claim filed in Mr Campana's proceeding against Mr Madafferi in which it is alleged that: 'In February 2006, [Mr Madafferi] requested [Mr Campana] to lend $40,000 to Premraj Caralapati'.[147]

79 It was put to Mr Campana that the 21 November 2019 email was an admission that he was aware of Ms Censori providing funds to Mr Madafferi in 2005.[148] Mr Campana's evidence was that he 'had no idea' whether or not Ms Censori had actually handed Mr Madafferi $40,000 in cash in 2005, and that he was merely recalling something he had been told in 2016.[149]

80 On a fair reading of the email Mr Campana was seeking to obtain Ms Censori's recollection of the events she had told him about in 2016. This request was met by Ms Censori stating that she didn't 'recall exactly what youre [sic] talking about'.[150] The email is not an admission that Mr Campana had personal knowledge that Ms Censori had in fact handed Mr Campana $40,000 in 2005.

81 I do not accept Ms Censori's evidence that she provided Mr Madafferi with $50,000 in cash which was applied towards the purchase of 160 Union Street. Ms Censori's net income in 2005 was approximately $30,000.[151] No plausible explanation is advanced as to how Ms Censori would have been able to accumulate $50,000. This $50,000 was in addition to the $14,000 in cash which Ms Censori claimed she advanced to Mr Campana in 2005. Second, Mr Madafferi's evidence, which I accept, is that Ms Censori did not provide him with any funds, let alone $50,000 in cash.[152] Third, by the second half of 2005 when Ms Censori says she provided the funds to Mr Madafferi, an ANZ loan account of $80,000 had been drawn down for the purpose of the fit‑out of 160 Union Street.

$69,200 drawn down on an ANZ Loan Account in Ms Censori's name on 22 July 2005.

82 It is common ground that an ANZ Loan Account secured against 160 Union Street was opened in Ms Censori's name on 22 July 2005.[153] It is also common ground that $80,000 was drawn down on the account on that same day. A sum of $69,200 was disbursed to Mr Campana, $10,300 was advanced to the loan broker, Mr Ken Phillips and Ms Censori received $500 as reimbursement for the establishment costs.[154] The $69,200 was used by Mr Campana to complete the fit-out of 160 Union Street.[155]

83 The loan was repaid in fortnightly instalments of $275. The payments covered both principal and interest on the loan. Twenty-one payments of $275 were made over the life of the loan, totalling $5,775.[156] A further $13,000 was paid into the account on 11 May 2006 by way of a First Home Owner Grant from the Victorian government.[157] The loan account was closed on 23 June 2006 by payment of $66,257.80 from Ms Censori's Commonwealth Bank Viridian Account.[158]

84 Mr Campana gave evidence that he was responsible for making the repayments on the loan.[159] Ms Censori denied this and alleged that she paid the 21 $275 instalments in cash over the counter at the bank.[160]

85 The $69,200 drawn down on the ANZ loan account in Ms Censori's name on 22 July 2005 cannot properly be characterised as a contribution by Ms Censori towards the purchase of 160 Union Street. The loan account was closed on 23 June 2006 by a payment of $66,257.80 from Ms Censori's Commonwealth bank Viridian account. As set out later in this judgment I have concluded that Mr Campana fully accounted to Ms Censori for the debit balance of the Viridian account including the funds which were used to close the ANZ loan account on 23 June 2006. Further, assuming in Ms Censori's favour that she did make payments into the account totalling $5,775, I am also satisfied for the reasons set out below that Mr Campana repaid this sum to Ms Censori.

Cheque for $38,723.45 endorsed to Mr Campana in May 2005

86 Ms Censori gave evidence that she endorsed a cheque to the value of $38,723.45 to Mr Campana in May 2005. The cheque was from the proceeds of Ms Censori and Mr Campana's mother's estate. She had passed away in December 2004. The endorsed cheque is not in evidence. However, Ms Censori produced a covering letter addressed to her from Sandhurst Trustees dated 3 May 2005 that enclosed a cheque for $38,723.45.[161] It is common ground that each of Mr Campana, Ms Censori and their three siblings received an equal distribution of $38,723.45 from their mother's estate.[162] I infer that Sandhurst Trustees would have sent each of the five children a cheque for $38,723.45 in about May 2005.

87 Ms Censori alleges that the cheque was endorsed to Mr Campana in response to his request for funds to complete construction of 160 Union Street.[163] Mr Campana does not deny that the cheque was endorsed to him and that he cashed the cheque in full. However, he says that the money was not loaned to him or used to finance the construction of 160 Union Street. Rather, Mr Campana contends that he was asked by Ms Censori to convert the cheque into cash and repay her an equivalent amount. On Mr Campana's account, Ms Censori asked him to do this so as to avoid having the amount deposited in her bank account, which may have required her to report the sum to Centrelink.[164] Mr Campana gave evidence that, within two to three months of receiving the cheque, he had repaid the full amount to Ms Censori.

88 On 16 September 2009 Centrelink provided Ms Censori with a decision in respect of the recovery of a Newstart Allowance Debt of $3,621.94 for the period 17 July 2006 to 26 November 2007.[165] The decision records, among other things, the following:

On 10 July 2006, you contacted Centrelink call centre to advise you received an inheritance from your mother's estate and the money had been used to repay your home loan.[166]

89 The letter from Sandhurst Trustees enclosing the cheque from Ms Censori's mother's estate is dated 3 May 2005. At that point in time, no loan had been secured by 160 Union Street. The first such loan was taken out on 22 July 2005.

90 Ms Censori could not explain the inconsistency between her statement to Centrelink that the money from her mother's estate had been used to pay down her home loan and her account of having given the money to Mr Campana for construction of the property. Ms Censori insisted that the Centrelink records wrongly recorded what she had told them.[167]

91 I reject Ms Censori's evidence that she endorsed a cheque for $38,723.45 to Mr Campana to be applied by him towards the cost of construction of 160 Union Street. First, her evidence is inconsistent with the statement she provided to Centrelink in July 2006. Second, Ms Censori's evidence must be weighed in the context of all of her evidence regarding the amounts totalling $225,000 which she says she advanced for the purchase of 160 Union Street. I have come to a clear conclusion that Ms Censori did not loan Mr Campana $52,000 or advance $50,000 to Mr Madafferi or $14,000 to Ms Manago. These payments amount to more than 50% of the purchase price of $225,000 for 160 Union Street. Once Ms Censori's evidence in respect of these amounts totalling $116,000 is rejected, it is unlikely that Ms Censori would have advanced $38,723.45 towards the construction of 160 Union Street.

92 Mr Campana's account of how the trust deed came into existence is as follows. On or about 9 May 2005, Mr Campana received a call from the conveyancer working in Mr Madafferi's office, Ms Andrea Crough. Ms Crough informed Mr Campana that he was now registered on the title of both 160 and 162 Union Street.[168] Mr Campana then attended Mr Madafferi's office and spoke to Ms Crough in an 'assertive' manner,[169] saying:

[L]ook, you know, inadvertently I think you've - you could have invalidated my building permits. One of them was supposed to be in the name - was issued in the name of my sister, and she was supposed to be registered on title for that building permit. Now that I'm on both of these titles, I may be ordered to pull down that building ... you're gonna have to go back and correct this.[170]

93 Mr Campana then requested that Mr Madafferi, who was upstairs at the time, be called down to rectify the problem. Mr Madafferi joined Mr Campana in the conference room. Mr Campana recalls the following conversation with Mr Madafferi:

In that conversation Mark said to me, ah, 'it's okay, you know? The title - your sister's going to be the legal owner of this property, but she'll be holding it on behalf of you'. And I said to him, ... 'well, that's what I asked Andrea to do'. And he said 'no', he said 'look, the Torrens system doesn't allow you to put someone on title and holding it in someone else's name. The owner has to hold it in name'. I said 'but I am the owner', and he said 'yes, of course,' he said, 'but look', he said, 'we can fix it all up'. He said 'call your sister', he says, 'and we'll work it out. We'll go and get - sign some documents and then she'll be holding this document - this property for you on trust'.[171]

94 Mr Campana then called Ms Censori and asked her to come to Mr Madafferi's office. Upon her arrival Mr Madafferi explained to Ms Censori her obligations as a trustee under a trust. Mr Campana recalls that Ms Censori was amenable to the arrangement, so long as Mr Campana did not default on any loans secured against the property or otherwise 'get her into any trouble'.[172] On Mr Campana's account this was the first and only occasion on which Mr Madafferi discussed the trust deed with Ms Censori.[173] The parties then signed the deed of trust, which Mr Campana recalls as being a one page document.[174] On Mr Campana's account, about two and a half hours elapsed between being called by Ms Crough to the signing of the trust deed.

95 Mr Madafferi's account of how the trust deed came into existence differs from Mr Campana's. On Mr Madafferi's evidence, the trust deed was signed after the contract of sale had been entered into,[175] but 'well before' Mr Campana came to be registered on the title of 160 Union Street on 9 May 2005.[176] Mr Madafferi gave evidence that around two to three months prior to registration, Mr Campana approached him regarding the building permit restriction, and that the idea of putting Ms Censori on the title to 160 Union Street was raised around that time.[177] Thereafter Mr Madafferi recalls having three meetings with Mr Campana and Ms Censori.

96 The first meeting was approximately ten minutes long at Ms Censori's house in Heidelberg.[178] Mr Madafferi recalls that it was a 'very hot day' and places the meeting at some point between December 2004 and February 2005.[179] At the meeting, Mr Madafferi was asked by Mr Campana to explain to Ms Censori what it meant for her to be registered on the title to 160 Union Street. Mr Madafferi explained the nomination process under the contract of sale, although no contract of sale was in existence at this point in time.[180] He explained that under the arrangement Mr Campana would be responsible for all payments.[181] Mr Madafferi does not recall whether he used the word 'trust' at this first meeting.[182] Ms Censori told Mr Madafferi that she would consider the proposal.

97 The second meeting took place at Mr Madafferi's office. The meeting was attended by Mr Campana, Ms Censori and Mr Madafferi. There, Mr Madafferi provided further detail on the proposed arrangement including telling her that the property would be in her name but held for Mr Campana's benefit and outlining the documents that would need to be signed. Mr Madafferi recalls telling Ms Censori 'the normal thing you would say to a client who you're transferring it on trust to'.[183] Mr Madafferi recalls after explaining these matters Ms Censori agreed, stating: 'so long as I don't get into any trouble, yeah, okay, okay'.[184] However, no documents were signed at this meeting.

98 The third meeting was held at Mr Madafferi's office and was attended by Mr Campana, Ms Censori and Mr Madafferi. It was at this meeting that Mr Madafferi recalls Mr Campana and Ms Censori signing both the nomination form for 160 Union Street and the trust deed.[185] Mr Madafferi recalled the signing of the nomination and trust deed as follows:

[T]hey came into the office... I remember and why I remember it also is because we were sitting next to - there was two doors and we were at the other door where the light switch is, and we sat around the end of the table. Normally I'd sit on the other side of the table but for some particular reason we were there and I do remember going through the documents, explaining the nomination, explaining the trust and we signed.[186]

99 Mr Madafferi gave evidence that the trust deed signed by the parties was derived from a precedent that his practice often used for declarations of trust. Mr Madafferi recalled the terms of the trust deed as follows:

the trustee would hold the property for the beneficiary, subject to the beneficiary paying all necessary, costs. Um, you know, um, mortgage payments - I - I'm not sure if I refer to mortgage payments in that particular document, but generally the document says anything to do with the outgoings relating to the property, on trust, for the beneficiary and that, um, should the beneficiary ever default in making any of those payments, that the trustee is empowered to sell the property to make good on any of the debts over the property. And finally, um, there was also the clause about if the beneficiary ever wanted the property transferred into their name, that the trustee would do that at the beneficiary's cost.[187]

...

Mr Carew: When the declaration of trust is made, what's the object of the trust, do you recollect?...is there a description of the land?

Mr Madafferi: Yeah, there is a description of the land that, um, he was - he'd - that they were going to - that he was purchasing this land. The land was nominated, she was going to hold it on trust for him and he would be responsible for all the outgoings, um, you know, to the land. And that when he wanted it back, he could ask for her to sign it back.[188]

...

Mr Carew: So if the declaration of trust is simply saying, Mr Campana settles 160 Union Street on Elaine Censori?---

Mr Madafferi: M'hmm.

Mr Carew: On trust, that doesn't make sense because Eris doesn't own the property, Avamax does. Do you understand that point?---Yeah.

Mr Madafferi: But the - but the recital would be that upon settlement of that property, that would invoke the terms of the trust.[189]

On Mr Madafferi's recollection, the deed was a typed document totalling one page, with the terms of the deed taking up 'three quarters of the page'.[190]

100 Mr Madafferi also recalls a conversation with Mr Campana following the registration of 160 Union Street in his name on 9 May 2005.[191] Mr Campana complained to Mr Madafferi regarding 160 Union Street being incorrectly transferred to him.[192] Mr Madafferi recalls that Mr Campana was 'really upset' by the error and that Mr Campana had 'a rather blunt exchange with me'.[193] This evidence, which I accept, provides further support for Mr Campana's evidence that he had been told that he could not obtain a building permit as an owner-builder. The building permit for 160 Union Street was issued to Ms Censori on 8 May 2005. On 9 May 2005 Mr Campana was told that he had been registered on title as the owner of 160 Union Street. He was very upset when told this because he believed that it would jeopardise his ability to undertake the development of 160 Union Street.

101 Thereafter, Mr Madafferi instructed Ms Crough to prepare documents to rectify the transfer. He recalls having to prepare and sign a statutory declaration to accompany the rectification which set out the basis for the rectification.[194] Mr Madafferi does not specifically recall whether he was present when the rectification transfer was signed.[195] However, he does recall that the rectification transfer was signed by Ms Censori and Mr Campana within days of Mr Campana first raising the complaint.[196] The rectification transfer is dated 31 May 2005, as it was his office's practice to only lodge signed documents at the Titles Office 'say once a week'.[197]

102 The consideration panel on the rectification transfer read as follows:

Firstly to rectify an error as error as C/T 10858-706 was incorrectly transferred and the sum of one hundred and thirty thousand dollars ($130,000) paid pursuant to a contract of sale dated 8th December 2004 between Avamax Pty Ltd and Elenia Censori

103 Mr Madafferi was questioned about the apparent inconsistency between the consideration panel on the rectification transfer and his evidence that it was Mr Campana who had entered into the contract of sale and had paid Avamax $130,000. Mr Madafferi's evidence was that Ms Crough drafted the consideration panel and he did not provide specific instructions on the wording of the transfer. Mr Madafferi suggested that the incorrect reference to Ms Censori as the purchaser under the contract of sale could be explained by the fact that she was nominated as transferor under the contract of sale.[198] In respect of the payment of $130,000 Mr Madafferi gave evidence that he was 'sure' that Mr Campana paid the money under the contract and that he 'had no dealings at all with Ms Censori in relation to payment' on the contract.[199] Mr Madafferi cannot recall whether the statutory declaration submitted alongside the rectification transfer mentioned the matters outlined in the consideration panel.[200] Mr Madafferi gave evidence that, on the signing of the rectification transfer, the parties did not re-sign any declaration of trust.[201]

104 Mr Carew submitted that Mr Campana's conduct between 2005 and the commencement of the proceeding on 1 August 2019 was inconsistent with him having a beneficial interest in 160 Union Street. He submitted that prior to the filing of the statement of claim Mr Campana never made a demand, as beneficiary, against Ms Censori, as trustee, for the return of trust property. In effect, Mr Carew submitted that the court should infer from Mr Campana's conduct that he did not have the beneficial interest in 160 Union Street for which he now contends.

105 Mr Carew points to the absence of any reference to 160 Union Street in a separation agreement between Mr Campana and Ms Rogers dated 24 October 2008.[202] Mr Carew submits that Mr Campana did not disclose any interest in 160 Union Street because he did not believe that he had any interest in the property.

106 Mr Campana gave evidence that the agreement did not refer to 160 Union Street because Ms Rogers knew of his interest in the property but was not interested in it.[203] Mr Madafferi gave evidence that he discussed the terms of the separation agreement with Ms Rogers and she told him that she was only interested in getting 1/200 Pigdon Street.[204] Mr Madafferi expressly discussed leaving any reference to 160 Union Street out of the agreement. Mr Madafferi also discussed with Ms Rogers' solicitor, Mr Conlan, leaving any reference to 160 Union Street out of the agreement.[205] Mr Conlan gave evidence that he had no recollection of the separation agreement or having had any discussion with Mr Madafferi about its terms.[206] However, he gave evidence that if he had been aware of Mr Campana's interest in the property he would not have advised Ms Rogers to sign an agreement that contained no reference to the property.[207] Ms Rogers gave evidence that she was not aware of Mr Campana's interest in 160 Union Street when she signed the agreement.[208]

107 Clause 5 of the separation agreement states that it 'relates to all property and financial resources of either of the parties before and during the relationship'. Clause 2 of the agreement states that Mr Campana and Ms Rogers separated on 5 March 2005. I prefer the evidence of Mr Madafferi and Mr Campana to that of Mr Conlan and Ms Rogers. That evidence is consistent with 160 Union Street not being property acquired during the relationship. Mr Campana was mistakenly registered on the title of 160 Union Street on 9 May 2005. Prior to that date Avamax Pty Ltd was the registered proprietor of the land. A certificate of occupancy was issued on 10 November 2005.[209] The absence of any reference to 160 Union Street is consistent with Mr Campana not being the registered proprietor of 160 Union Street when Mr Campana and Ms Rogers separated. Ms Rogers did give evidence that her relationship with Mr Campana did not end until 2006.[210] I place no weight on this evidence. The date of separation as recorded in the agreement signed by both parties in 2008 is more reliable than Ms Rogers' recollection after the passage of a further 15 years.

108 Further, in contrast to Mr Conlan, Mr Madafferi had a clear recollection of the events relating to the drafting of the agreement, including his discussions with Ms Rogers. I accept his evidence that Ms Rogers was aware of 160 Union Street but had no interest in any reference to the property being included in the agreement. This evidence is consistent with Mr Campana's unchallenged evidence that the source of funds for the purchase of 160 Union Street was a loan of $550,000 drawn down by Ms Rogers against the security of 1/200 Pigdon Street.[211]

109 In effect, Mr Carew submitted that the court should infer from Mr Campana's conduct that he did not have the beneficial interest in 160 Union Street for which he now contends. I accept Mr Carew's submission that there was no formal demand for the return of 160 Union Street until the filing of the statement of claim on 1 August 2019. I reject Mr Carew's submission that prior to 1 August 2019 Mr Campana did not engage in any conduct consistent with him having a beneficial interest in 160 Union Street. First and foremost there is the express trust deed. This is evidence consistent with Mr Campana having a beneficial interest in 160 Union Street. Further, although Mr Campana did not make a formal demand for the return of the property, he did engage in conduct consistent with him having a beneficial interest. Mr Campana's conduct in respect of various loans secured against 160 Union Street is consistent with him having a beneficial interest in the property. On 22 July 2005, Ms Censori took out a loan for $80,000. On 19 May 2006, Ms Censor opened the Viridian account.[212] On 5 October 2007 Ms Censori opened an Investment Home Loan Account.[213] Shortly after the account was opened she drew cheques totalling $450,000 in favour of Azurn International Ltd. The $450,000 was paid to Azurn pursuant to a loan agreement between Azurn and Privacon Pty Ltd, a company of which Mr Campana was a director. Mr Campana was the beneficiary of repayments that Azurn made under the loan agreement. The loan was at an interest rate of 20.5% per annum. The monthly repayments of $8,000 began on 13 December 2007 and were paid to Mr Campana. He deposited these funds into the Investment Home Loan Account.

110 I accept that Ms Censori acted at the direction of Mr Campana in drawing down funds against the security of 160 Union Street. Nevertheless, Mr Campana acted for all intents and purposes as though 160 Union Street was his property. Not only did he enjoy the benefit of funds raised against the security of 160 Union Street, he also took on the burden of paying the debts secured against the property. Between late 2007 and 6 May 2014, it is common ground that Mr Campana deposited $555,815.18 into the Investment Home Loan Account.

111 Mr Campana was experiencing significant financial difficulties between 2009 and 2015. In part these difficulties arose from a personal guarantee provided to CBFC Ltd in March 2008. Mr Campana was sued on the guarantee. On 17 December 2012 judgment was entered against him for $148,669.99 with $4,384.67 and costs $2,400.[214] Mr Campana was not able to clear this debt until he sold 160 Union Street on 3 June 2013.[215]

112 Mr Carew submitted that, notwithstanding Mr Campana's dire financial position, he took no steps to reclaim 160 Union Street. He submitted that his failure to do so reflected the reality that he had no beneficial interest in the property.[216] I reject this submission. Mr Campana's failure to take steps to reclaim 160 Union Street is explicable by reason of his wish to keep 160 Union Street out of the hands of his creditors. Mr Madafferi gave unchallenged evidence that he discussed with Mr Campana that 160 Union Street would be 'safe' while it was held for his benefit by Ms Censori.[217]

113 Mr Campana gave evidence that he offered to sell 160 Union Street to Ms Censori in April 2014 for $550,000 but Ms Censori was only prepared to pay $280,000.[218] Mr Campana had sold 162 Union Street on 3 June 2013 for $675,000.[219] He was not willing to sell 160 Union Street for less than $550,000 which he considered to be a price which gave Ms Censori a considerable benefit.[220] Mr Campana was not directly challenged on this evidence when he repeated it during cross‑examination.[221] Ms Censori did not give evidence responding to Mr Campana's evidence that he offered to sell 160 Union Street to her. I accept Mr Campana's evidence that he did offer to sell 160 Union Street to Ms Censori for $550,000. This conduct is consistent with him having a beneficial interest in the property.

114 I accept Mr Madafferi's evidence that the parties entered into a deed of trust prior to the transfer of the property from Avamax Pty Ltd to Mr Campana on 9 May 2005. Under the terms of the trust, Ms Censori was to hold 160 Union Street on trust for Mr Campana's benefit. I accept Mr Madafferi's evidence that the precedent used was a 'declaration of trust'.[222] On the basis of that evidence, Ms Censori was both the settlor and trustee under the deed of trust.[223]

115 The clearest evidence of the mutual intention of Mr Campana and Ms Censori that 160 Union Street would be held on trust for his benefit is the express trust deed drafted by Mr Madafferi in early 2005, coupled with Mr Campana having purchased the property. As set out later in this judgment a constructive trust came into existence on 31 May 2005 upon Ms Censori being registered on the title of 160 Union Street. The conduct of Mr Campana and Ms Censori post-31 May 2005 cannot unwind the trust which came into existence on that day.

116 To constitute a valid trust, the settlor must intend to create a trust over certain subject matter for the benefit of an identifiable beneficiary.[224] The requirement that a trust have certain subject matter stems from the nature of a trust as a relationship arising out of ownership of property. The settlor must have a distinct vested or contingent proprietary interest in the property the subject of the trust.[225] An expectation of a future interest is not a vested or contingent proprietary interest.

117 Prior to settlement of a contract for the sale of land, a purchaser has a right to seek an order for specific performance of the contract.[226] That right may be held on trust.[227] However, Ms Censori was not a purchaser under the contract. I accept Mr Madafferi's evidence that Ms Censori was a nominee at the time she signed the declaration of trust.

118 The nature of a nominee's rights under a contract for the sale of land were considered by Nettle J (as his Honour then was) in Commissioner of State Revenue v Politis:[228]

Plainly, however, under most nomination clauses the nominee would not acquire any rights as against the vendor, let alone the rights of the purchaser; for most nomination clauses constitute no more than a power in the purchaser to require the vendor to complete the contract by transfer of the land to the purchaser's nominee. In such cases the purchaser has rights as against the vendor to have the land transferred to the purchaser or to the purchaser's nominee, at least upon payment of the purchase price. And the purchaser has an interest in the land, in the nature of an equitable fee simple (assuming that the contract provides for purchase of the fee simple), although of course that really means no more than that the contract is susceptible to an order for specific performance at the suit of the purchaser. But the nominee does not acquire any rights as against the vendor, because the nominee is not privy to the contract. And for the same reason, the nominee has no standing in equity to obtain an order for specific performance of the contract. He must sue in the name of the purchaser or join the purchaser as a defendant. Therefore, such if any interest as the nominee may have in the land is one which derives from the purchaser, and relevantly the most that can be said is that the nominee may acquire an interest in the land equivalent to that which the purchaser had or would have had under the contract of sale.[229]

119 Whether a nominee obtains a right to enforce a contract depends on the terms of the nomination. Mr Campana has not adduced evidence of the terms of the nomination form that was signed by the parties. Absent such evidence there is no basis for inferring that the nomination form went further than nominating Ms Censori as the transferee under the contract of sale for the 160 Union Street. As such, Ms Censori did not have a right to seek specific performance of the contract of sale.

120 Mr Campana's claim based upon an express trust must fail because Ms Censori was not the owner of 160 Union Street when the deed was executed. Any rights conferred upon her as a nominee do not constitute a distinct vested or contingent proprietary interest in 160 Union Street.

Mr Campana's claim under a resulting or constructive trust

121 In the alternative to his claim based on an express trust, Mr Campana alleges that Ms Censori holds 160 Union Street on trust for him under either a resulting or constructive trust. The resulting trust is said to arise from Mr Campana having paid for the entirety of the purchase and construction costs associated with 160 Union Street. In the alternative, Mr Campana claims that by reason of his purchase of the property and his reliance on the terms of the trust deed, it would be unconscionable for Ms Censori to deny Mr Campana's interest in the property. Mr Campana claims that the Court should declare a constructive trust over 160 Union Street for his benefit.[230]

122 During final submissions Mr Carew submitted that the Court could not be satisfied that Mr Campana had in fact purchased 160 Union Street. He pointed to the absence of any financial records which disclosed that Mr Campana had the necessary funds in 2005 to complete the purchase of 160 Union Street. I reject this submission. First, it was not put to Mr Campana during cross-examination that he did not have the financial resources in 2005 to complete the purchase of 160 Union Street. The defence to Mr Campana's claim was not conducted on the basis that he did not have the financial resources to complete the purchase, but rather that Ms Censori had purchased the property. Second, there is evidence of $132,500 being paid into the trust account of Chiodo Madafferi by Mr Campana and then being paid to Mr Chiarella for the purpose of the Union Street development. Third, there is the evidence of Mr Madafferi that Ms Censori made no payments towards the purchase of 160 Union Street and that all of the payments were made by Mr Campana.[231] Fourth, Mr Campana gave unchallenged evidence that in March 2005 Sarah Rogers took out a loan of $550,000 against 1/200 Pigdon Street and made those funds available to him for the purchase of 160 and 162 Union Street.[232] No evidence was led from Sarah Rogers which contradicted Mr Campana's evidence.

Did a resulting trust arise from the failure of the express trust?

123 A resulting trust may arise by operation of law as a means of filling a gap in beneficial ownership of property. A resulting trust may arise upon the failure of an express trust. As explained by Mason J in DKLR Holding v Commissioner of Stamp Duties,[233] a resulting trust may 'arise when the entire estate is conveyed to the trustee but the dispositions of the equitable estate or interest fail so that it comes back to the settlor'.[234] In such a case, the settlor-transferor transfers legal title to the property to the would‑be trustee, but the law operates to automatically vest the beneficial interest in the property back to the settlor-transferor. The transferee thereafter holds the property on a resulting trust for the settlor-transferor's benefit.

124 Although I have concluded that the express trust signed by the parties failed by reason of uncertain subject matter, a resulting trust did not arise from the failed attempt to create an express trust. The express trust the parties attempted to create did not involve any transfer of a legal interest. Ms Censori was both the settlor and the trustee under the declaration of trust. The principle in DKLR Holding has no application because there was no beneficial interest held by Mr Campana at that time that could result back to him upon the failure of the express trust.

Did a resulting trust arise from Mr Campana's contributions to the purchase price of the property or from a voluntary transfer of the property to Ms Censori?

125 A resulting trust may also arise in circumstances where it is presumed the parties intended to create a trust. A resulting trust may arise in favour of a transferor of property or a contributor of purchase money.[235] The resulting trust operates as a presumption of fact from which the court draws an inference as to the intention of the transferor or contributor regarding where they intended to allocate the beneficial interest in the property.

126 The High Court has recently considered the presumption of resulting trust in Bosanac v Commissioner of Taxation.[236] Gordon and Edelman JJ considered the limited scope for the operation of the presumption of resulting trust:

The presumption of resulting trust - the standardised inference that allocates the onus of proof - serves the same function as a civil onus of proof and operates to resolve a factual contest when the relevant evidence is "uninformative or truly equivocal". It arises if there be a paucity of evidence as to an intention to declare a trust. Put in different terms, where the presumption arises, the existence of a resulting trust is an inference drawn in the absence of evidence when, for example, a purchaser of property causes it to be transferred to another or when a person contributes to the purchase of property which is registered in the name of another. But such an inference - of resulting trust - cannot arise where a plaintiff has led evidence that tends to establish an objective intention or the lack of an objective intention to create a trust.

As a resulting trust is an inference drawn in the absence of evidence, it is necessary to start with the objective facts. It is a factual inquiry. The question may be framed in these terms: what were the parties' words or conduct at the time of the transaction or so immediately thereafter as to constitute part of the transaction - the objective facts?

...

Where the objective facts based on evidence led by the plaintiff tend to establish an objective intention that a provider of part of the purchase price would hold an equitable interest as to a particular proportion of a particular property, there will be an express trust which satisfies the three certainties of intention, subject and object. That is the case that the defendant has to meet. There is no need for a presumption of resulting trust to shift the onus of proof. The presumption of resulting trust does not arise. It is unnecessary.

...

Where, however, the objective facts based on evidence led by the plaintiff are neutral, truly equivocal, non-existent or uninformative as to the objective intention of the parties, then, consistent with the weak presumption of resulting trust, an inference can be drawn of a declaration of trust by the provider of part of the purchase price. That weak inference will be the case that the defendant has to meet.[237]

Where evidence relevant to intention is adduced, the presumption [of resulting trust] and the counterpresumption [of advancement] are therefore of practical significance only in rare cases where the totality of the evidence is incapable of supporting the drawing of an inference, one way or the other, on the balance of probabilities about what contributors and purchasers actually intended when they participated in the purchase transaction.[238]

128 It is well-established that evidence of contrary actual intention will negative the presumption of resulting trust.[239] However, where there is evidence of a positive intention to create an express trust, the presumption of resulting trust does not arise.

129 Mr Campana contends that because he purchased 160 Union Street, Ms Censori holds the property for him on a resulting trust. I have concluded that Mr Campana paid for the entirety of 160 Union Street. However, I have also concluded that the parties signed a deed of trust under which Mr Campana was the beneficiary and Ms Censori the trustee.

130 The fact of the parties' entry into a deed of trust is objective evidence evincing an intention to create a trust. In light of that evidence there is no room for the presumption of resulting trust to arise. The parties made clear by their entry into the trust deed how they intended to allocate the beneficial interest in 160 Union Street. I reject Mr Campana's claim that 160 Union Street is held on resulting trust for his benefit.

131 A party may seek relief under a common intention constructive trust. Such a trust arises where:

i. there is an actual or inferred common intention of the parties as to their beneficial interest in a property;

ii. there has been detrimental reliance on that common intention by the claimant; and

iii. it would be an equitable fraud on the claimant to deny his or her interest in the property.[240]

132 By entry into the trust deed, Mr Campana and Ms Censori formed a common intention that Mr Campana would at all times be the beneficial owner of 160 Union Street. The parties intended for the beneficial and legal interests in the property to be split.[241] The fact that Mr Campana paid the entirety of the purchase price of 160 Union Street supports an inference he intended to retain a beneficial interest in the property commensurate with his contributions.[242]

133 Mr Campana detrimentally relied on the parties' common intention. On the faith of the agreement between the parties, Mr Campana paid for the entirety of the property. He transferred title to 160 Union Street to Ms Censori on 31 May 2005 in the expectation that she would honour the agreement they had reached. The common intention constructive trust takes effect from the point at which the conduct giving rise to it occurs.[243] In Department of Social Security v Agnew,[244] the Full Court of the Federal Court stated:

The trust arose when, in reliance on his statement that the land was theirs, the [claimants] acted in the manner we have described... the authorities support the view that it is the conduct of the claimant that gives rise to the equity.[245]

134 A finding of equitable fraud does not require a showing of conscious dishonesty and may be found upon an innocent breach of an equitable obligation.[246] Ms Censori has engaged in equitable fraud by failing to honour the common intention of the parties when Mr Campana called for a transfer of the property.

135 As an equitable remedy, the imposition of a constructive trust is ultimately a matter of discretion for the Court. In exercising the power to declare a constructive trust, it is necessary to consider whether 'there is an appropriate equitable remedy which falls short of the imposition of a trust'.[247] Such consideration relevantly requires a consideration of the interests of third parties and whether the imposition of the trust might unjustly enrich the plaintiff.[248] I am satisfied that a declaration of constructive trust is the appropriate remedy in the circumstances of the case.

136 Ms Censori has held 160 Union Street as trustee for Mr Campana's benefit from the date of transfer on 31 May 2005. It is common ground that Ms Censori vacated 160 Union Street in February 2016 and thereafter rented the property to tenants. It is also common ground that Ms Censori has received $182,097 rental income from the property. Mr Carew accepted that if Ms Censori holds 160 Union Street on trust for Mr Campana, she is liable to account to Mr Campana in the sum of $182,097.[249]

137 Ms Censori alleges that in September 2007 she entered into an agreement with Mr Campana to lend him $464,000. Under the terms of the alleged agreement the $464,000 was to be funded by an Investment Home Loan Account secured by 160 Union Street. Mr Campana agreed to credit Ms Censori's Streamline/Viridian Account with $8,000 per month. The $8,000 was to be applied to pay the monthly instalments on the Investment Home Loan Account of $3,750, with the balance to be retained by Ms Censori for her benefit. Mr Campana was to make monthly payments of $8,000 until the debit balance of the Investment Home Loan Account had been cleared.

138 On 5 October 2007 a loan account with Commonwealth Bank for $464,000 was taken out over 160 Union Street ('Investment Home Loan Account').[250] It is common ground that Mr Campana requested Ms Censori open the Investment Home Loan Account for his benefit. It is also common ground that following the opening of the Investment Home Loan Account, $234,439.24 was drawn down and paid into the Viridian/Streamline Account, thereby extinguishing any debt owed on that account. On 5 October 2007, a $200,000 cheque was drawn on the Investment Home Loan Account by Ms Censori. The $200,000 cheque was paid to Azurn International Ltd ('Azurn').[251] On 6 December 2007, a $250,000 cheque was drawn by Ms Censori on the Viridian/Streamline Account and paid to Azurn.[252] The $450,000 paid to Azurn was pursuant to a loan agreement between Azurn and Privacon Pty Ltd, a company of which Mr Campana was a director.[253]

139 It is common ground that between late 2007 and 6 March 2014 Mr Campana made deposits into the Investment Home Loan Account totalling $555,815.18. However, when Mr Campana made the final deposit of $100,000 on 6 March 2014 the account still had a debit balance of $141,288.97.[254] Ms Censori alleges that as the account was still in debit Mr Campana had an ongoing obligation to make monthly payments of $8,000 into the account. Ms Censori contends that Mr Campana's accumulated liability for the period 6 March 2014 to 31 March 2023 is $816,360.56.[255] In the alternative, Ms Censori claims $375,416.33.[256] This claim is premised on the September 2007 loan agreement having been terminated on 28 June 2017 when Ms Censori commenced withdrawing sums totalling $88,000 from the account.[257]

140 Ms Censori says that the loan agreement between herself and Mr Campana was reduced to writing in an agreement dated 7 November 2007. Her evidence was that the agreement was drawn up by Mr Madafferi.[258] Mr Madafferi does not recall drawing up any loan agreement between the parties in 2007,[259] and says he 'would've remembered a loan agreement between them for that amount of money'.[260] There is no written loan agreement in evidence. Ms Censori did not see the loan agreement, nor could she recall any of its terms.[261] Mr Campana accepts that he did enter into an agreement with Ms Censori to pay $8,000 per month into the Investment Home Loan Account. However, he contends that the $8,000 was to be applied in full towards repayment of the account's debit balance. He denies that there was any agreement that approximately $4,250 of each monthly instalment would be retained by Ms Censori for her personal benefit.

141 It is common ground that if all of the $555,815.18 deposited into the Investment Home Loan Account by Mr Campana had been retained in the account, the debit balance in the account would have been cleared with the final deposit of $100,000 on 6 March 2014.[262] The critical issue is whether, as contended by Ms Censori, she was free to apply for her benefit the portion of the $8,000 monthly payment in excess of the $3,750 required to service the Investment Home Loan Account. The resolution of this issue is linked with the primary issue in the proceeding of whether Ms Censori held the beneficial interest in 160 Union Street on trust for Mr Campana.

142 I have concluded that from 31 May 2005 Ms Censori held 160 Union Street on trust for Mr Campana. In light of this conclusion, it is highly unlikely that Mr Campana would have agreed that approximately $4,250 of each monthly payment of $8,000 would be for Ms Censori's personal benefit. If Ms Censori were the beneficial owner of 160 Union Street there would be a rational basis for Mr Campana to have made a monthly payment to Ms Censori of $4,250 in recognition of the fact that the Investment Home Loan Account was secured against 160 Union Street. However, as Ms Censori held 160 Union Street on trust for Mr Campana there is no plausible reason why he would have agreed to $4,250 of the monthly payment of $8,000 being for Ms Censori's benefit.

143 Mr Campana gave evidence that he made deposits of $8,000 per month until September 2009 and thereafter made smaller monthly deposits until April 2011. He gave evidence that he ceased making payments of $8,000 in September 2009 when Ms Censori was allocated 2,375,000 shares in Azurn International.[263] Ms Censori contends that the allocation of shares to her in Azurn International had no bearing on Mr Campana's obligation to continue making monthly payments of $8,000 into the Investment Home Loan Account.[264]

144 It is unnecessary to determine what effect the allocation to Ms Censori of 2,375,000 shares had upon Mr Campana's agreement to repay the Investment Home Loan Account. Although the quantum of monthly payments after September 2009 reduced, the total payments by March 2014 would have extinguished the debit balance in the account if Ms Censori had not been applying funds from the account for her personal benefit.

145 Upon directing Ms Censori to take out the loan of $464,000, Mr Campana expressly assumed an obligation to repay Ms Censori the balance of the loan. Upon opening of the account, Mr Campana credited $29,560.76 to the Investment Home Loan account.[265] He had also left $18,163 credited to the Viridian/Streamline Account.[266] Accordingly, his total liability to the account was $416,276.24.

146 It is agreed between the parties that Mr Campana paid $156,750 into the Viridian/Streamline Account between 13 December 2007 and 10 August 2009 and that between 8 September 2009 until 11 April 2011, Mr Campana paid a total of $80,050 consisting of monthly payments of between $4,000-$4,750 into the Viridian/Streamline Account.

147 It is common ground that four further lump sum payments were advanced by Mr Campana to Ms Censori. A payment of $50,000 was made on 6 June 2011 and a payment of $127,266.22 was made on 14 July 2011. It is also agreed that on 28 May 2013 and 6 March 2014, Mr Campana caused two payments of $41,971.94 and $100,000 from the proceeds from the sale of 162 Union Street to be deposited into the Investment Home Loan Account.

148 In total, Mr Campana has paid $555,858.15 into the Investment Home Loan Account. Mr Campana did not breach the agreement he entered into in October 2007 to repay the debit balance of the Investment Home Loan Account. Ms Censori's counterclaim which is premised upon his failure to have cleared the debit balance of the Investment Home Loan Account must be dismissed.

149 I shall grant Mr Campana's application for a declaration that Ms Censori holds 160 Union Street on trust for his benefit. Ms Censori shall be ordered to transfer 160 Union Street to Mr Campana or his nominee. I shall order Ms Censori to pay Mr Campana the sum of $182,097. Mr Campana is entitled to interest on this sum from 18 February 2021 when he first made a claim based on the rent received by Ms Censori from 160 Union Street. Ms Censori's counterclaim is dismissed. I shall provide the parties with an opportunity to make submissions on the form of order to give effect to this judgment and the costs of the proceeding.

[1] Interpretation of Legislation Act 1984, s 14(2)(d).

[2] Defendant's Closing Submissions, [72].

[3] [1938] AC 156.

[5] Labracon Pty Ltd v Cuturich [2013] NSWSC 97, [159].

[6] [1993] FCA 611; (1993) 119 ALR 215.

[8] Transcript of Proceedings, T 808 L 10-12.

[9] Burkett v Bendigo and Adelaide Bank Ltd (No 2) [2018] VSC 723, [113]; Melbourne Coach Terminal Pty Ltd v Wyss [2003] VSC 122, [37]; Barrington Winstanley Group Pty Ltd v Edmonds [2022] NSWSC 531, [84]; Offshore Oil NL v Southern Cross Exploration NL (1985) 3 NSWLR 337, 341.

[10] Transcript of Proceedings, T 243 L 5-7; T 276 L 6-11.

[12] Maks v Maks (1986) 6 NSWLR 34; D R McKendry Nominees Pty Ltd [2015] VSC 560, [7]; Application by Barry McMahon Nominees Pty Ltd [2021] VSC 351, [12]; Chase v Chase [2020] NSWSC 1689, [27]; Barp Nominees Pty Ltd [2016] NSWSC 990, [6].

[13] Vanta Pty Ltd v Mantovani [2023] VSCA 53, [83].

[14] Transcript of Proceedings, T 168 L 25-30; T 174 L 10-13; T 522 L 14-25.

[22] Ibid T 175 L 14-21; T 373 L 13-7; T 414 L 4-13; T 415 L 1-11.

[24] Ibid T 204 L 7-13; T 373 L 20-30; T 412 L 9-27; T 413 L 10-27.

[25] Ibid T 172 L 31 - T 173 L 1; T 365 L 26-30; T 411 L 20 - T 412 L 8; T 175 L 3-4; T 373 L 25-30.

[29] Ibid T 171 L 21-3; T 710 L 20 - T 711 L 9; CB571 [6].

[32] CB418, Title Search - 160 Union Street.

[33] CB419, Title Search - 160 Union Street.

[34] Transcript of Proceedings, T 96 L 4-14; T 179 L 10-13.

[40] CB410, H Albert Nominees Pty Ltd Trust Account Statement; CB420, Title Search - 160 Union Street; CB434, Title Search - 162 Union Street.

[41] CB413, H Albert Nominees Pty Ltd Trust Account Statement.

[42] Transcript of Proceedings, T 97 L 2-17.

[45] Ibid T 99 L 30 - T 100 L 3; T 378 L 21 - T 379 L 7.

[62] Ibid T 534 L 19-23; T 353 L 2-15; T 539 L 24-26; T 541 L 20-29.

[64] CB359, Contract of Sale of Real Estate - Elenia Censori.

[65] CB359, Contract of Sale of Real Estate - Elenia Censori.

[66] CB350, Contract of Sale of Real Estate - Eris Censori.

[67] CB1924, Transfer of Land dated 9 May 2005.

[68] CB377, Transfer of Land dated 31 May 2005.

[69] Transcript of Proceedings, T 186 L 21-23.

[75] Ibid T 429 L 11-24; T 430 L 22-24; T 389 L 13.

[80] CB2051, Amended Statement of Claim in Supreme Court Proceeding SCI 2016 02232.

[81] Transcript of Proceedings, T 434 L 13-14.

[84] Ibid T 714 L 8-27; T 715 L 9-21; T 718 L 6-23; T 729 L 1-27.

[85] Ibid T 704 L 14; T 530 L 27 - T 531 L 1.

[88] Ibid T 708 L 18-21; T 710 L 30 - T 711 L 2; T 725 L 6-9.

[91] Building (Amendment Act) 2004, s 8; Building Act 1993, s 25E(1)(e).

[92] Victorian Government Gazette, No. G 18, Thursday 5 May 2005, 844, 851.

[93] CB422, Building Permit dated 8 April 2005.

[94] Transcript of Proceedings, T 97 L 27 - T 98 L 14.

[97] Ibid T 99 L 30 - T 100 L 4; T 241 L29 - T 242 L 3.

[104] Ibid T 751 L 11-13; T 745 L 17-22.

[106] Evidence Act 2008, s 140(2)(c).

[107] Transcript of Proceedings, T 542 L 31 - T 543 L 14.

[113] Ibid T 527 L 12-18; T 528 L 1-2.

[116] Transcript of Proceedings, T 529 L 6-15.

[129] Transcript of Proceedings, T 536 L 3-26

[138] Amended Defence to Further Amended Statement of Claim dated 21 June 2023, [11].

[142] Ibid T 395 L 10-12; T 449 L 22 - T 450 L 2.

[143] CB684, Email chain between Eris Censori and Elenia Censori dated 20-21 November 2019.

[144] CB684, Email chain between Eris Censori and Elenia Censori dated 20-21 November 2019.

[145] Transcript of Proceedings, T 164 L 17-26.

[147] CB2043, Amended Statement of Claim in Supreme Court Proceeding SCI 2016 02232.

[148] Transcript of Proceedings, T 182 L 21-24; T 66 L 12-14

[150] CB684, Email chain between Eris Censori and Elenia Censori dated 20-21 November 2019.

[151] Transcript of Proceedings, T 538 L 5-18.

[152] Ibid T 395 L 10-12; T 449 L 22 - T 450 L 2.

[153] CB798, ANZ Account Statement period ending 21 October 2005.

[154] Transcript of Proceedings, T 111 L 21-27.

[155] Ibid T 111 L 11-17; T 628 L 20-21.

[156] CB798-801, ANZ Account Statements, 21 October 2005 - 23 June 2006.

[157] CB468, Letter from State Revenue Office to Ms Elaine Censori dated 1 December 2005.

[158] CB801 ANZ Account Statement period ending 23 June 2006; Transcript of Proceedings, T 120 L 30 - 121 L 6.

[161] CB427, Letter from Sandhurst Trustees to Elaine Ambesi dated 3 May 2005.

[162] Transcript of Proceedings, T 626 L 24 - T 627 L 2.

[165] CB596, Letter from Centrelink to Elaine Ambesi.

[166] CB599, Letter from Centrelink to Elaine Ambesi.

[167] Transcript of Proceedings, T 698 L 12-13.

[176] Ibid T 396 L 27-28; T 387 L 25-27.

[185] Ibid T 429 L 11-24; T 430 L 22-24; T 389 L 13.

[202] CB571, Separation Agreement dated 24 October 2008.

[203] Transcript of Proceedings, T 208 L 25-31.

[204] Ibid T 449 L 13-19; T 511 L 3 - 7; T 511 L 19-25; T 512 L 2-9.

[206] Ibid T 685 L 25-28; T 686 L 24-30.

[209] CB464-5, Occupancy Permit dated 10 November 2005.

[210] Transcript of Proceeding, T 721 L 8-10.

[212] CB861, Streamline Account Statement.

[213] CB1056, Investment Home Loan Summary.

[214] CB2012, Deed of Assignment of Debt dated 10 December 2013.

[215] Transcript of Proceedings, T 319 L 26-31.

[216] Defendant's Closing Submissions, [136].

[217] Transcript of Proceedings, T 516 L 13-23.

[219] CB432, Historical Title Search of 162 Union Street; Transcript of Proceedings, T 158 L 16.

[220] Transcript of Proceedings, T 158 L 14.

[223] See Comptroller of Stamps (Vic) v Howard-Smith [1936] HCA 12; (1936) 54 CLR 614, 621.

[224] Korda v Australian Executor Trustees (SA) Ltd (2015) 255 CLR 62, 71 [7]; 123 [205].

[225] Re Rules Settlement [1915] ArgusLawRp 119; [1915] VLR 670, 674.

[226] Dougan v Ley [1946] HCA 3; (1946) 71 CLR 142, 150.

[227] Bahr v Nicolay (No 2) [1988] HCA 16; (1988) 164 CLR 604, 618-9.

[228] Commissioner of State Revenue v Politis [2004] VSC 126.

[230] Further Amended Statement of Claim, [16].

[231] Transcript of Proceedings, T 385 L 23-8.

[232] Ibid T 191 L 9-22; CB571, Separation Agreement dated 24 October 2008.

[233] DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) [1982] HCA 14; (1982) 149 CLR 431.

[235] Bosanac v Commissioner of Taxation [2022] HCA 34; (2022) 96 ALJR 976, 994 [94].

[239] Muschinski v Dodds [1985] HCA 78; (1985) 160 CLR 583, 590 ('Muschinski').

[240] Imam Ali Islamic Centre v Imam Ali Islamic Centre [2018] VSC 413, [402].

[242] Shepherd v Doolan [2005] NSWSC 42, [37].

[243] Dept of Social Security v Agnew [2000] FCA 59; (2000) 96 FCR 357, 365 [18]; Parsons v McBain [2001] FCA 376; (2001) 109 FCR 120, 126 [14]-[15].

[244] [2000] FCA 59; (2000) 96 FCR 357.

[246] MAPA Pearls Pty Ltd v Haliotis Fisheries Pty Ltd [2023] VSCA 108 [61].

[247] Giumelli v Giumelli (1999) 196 CLR 101, 113.

[248] Parsons v McBain [2001] FCA 376; (2001) 109 FCR 120, 126 [15].

[249] Defendant's Closing Submissions [133].

[250] CB1057, Commonwealth Bank Investment Home Loan Account statement for period ending 10 October 2007.

[251] CB564, Cheque to Azurn International dated 5 October 2007.

[252] CB879, Commonwealth Bank Streamline Account statement for period ending 31 December 2007; CB569, Cheque to Azurn International dated 6 December 2007.

[253] Transcript of Proceedings, T 282 L 3-5.

[254] CB1097, Commonwealth Bank Investment Home Loan Account statement for period ending 11 March 2014.

[255] CB2105, Amended Table in respect of Paragraph 26 of the Further Amended Counterclaim.

[258] Transcript of Proceedings, T 607 L 10.

[263] Ibid T 140 L 25-29; T 142 L 24-29; T 309 L 26-29.

[265] CB1057, Commonwealth Bank Investment Home Loan Account statement for period ending 10 October 2007; Transcript of Proceedings, T 133 L 21-27.

[266] CB879, Commonwealth Bank Streamline Account statement for period ending 31 December 2007; Transcript of Proceedings, T 131 L 28-29.