Plaintiff v Defendants

1 By originating motion filed 16 November 2018, Maria Versaci ('Maria'), by her administrator, seeks answers to questions concerning the distribution of the sale proceeds of a property known as 140A Miller Street, North Fitzroy ('140A Miller Street').

2 Maria is now aged 83. On 10 March 2017, Ms Lyttleton was appointed her administrator by the Victorian Civil and Administrative Tribunal.

3 Maria and her husband, Antonino Versaci ('Antonino') had seven children, six of whom are living: Gina born 21 July 1959, Rocco born 24 March 1963, Domenica born 9 May 1965, Francesca born 18 May 1967, Caterina and Annunziato born 21 December 1969 ('the children'). Another child, Biagio, born 24 June 1961, died on 4 May 1988.

4 Maria and Antonino were the joint registered proprietors of 140A Miller Street. On Antonino's death on 28 October 2010, his jointly owned property passed to Maria by survivorship. Further, by his will dated 1 February 2005, Antonino left his whole estate to Maria. On 3 November 2017, Maria was registered as the sole proprietor of 140A Miller Street, pursuant to a survivorship application. On 14 October 2017, 140A Miller Street was sold with settlement taking place on 14 November 2017.

5 Affidavits were filed by Gina, Rocco, Domenica, Francesca, Caterina and Annunziato. Of these affidavits, Gina and Annunziato provided the substantive evidence. The affidavits of the remaining children cross-referenced certain paragraphs in the two principal affidavits, in substance either agreeing with or not knowing about certain matters.

6 An affidavit by Giuseppe Santomartino, accountant, was also filed. He referred to a meeting in October 2010 with Maria and the children, save for Rocco, where he advised on the financial implications of a sale of 140A Miller Street, including its effect on Maria's Centrelink pension and capital gains tax for all family members.

7 In or about 1971, Maria and Antonino purchased 140A Miller Street. On 3 May 1997, they were registered as joint proprietors. Maria and Antonino lived in the property with the children until sometime in 1980 when, save for Gina, they moved to 107 Miller Street, North Fitzroy ('107 Miller Street'), which became their family home.

8 Annunziato deposes that 107 Miller Street came on to the market in 1983 and that his father indicated to him that, if it went for the right price, he would purchase it. Annunziato states that he was aged 14 years at that time and that he and Domenica attended the auction with Antonino, who was the successful bidder. Annunziato's dates for the auction are out by three years. The auction of 107 Miller Street took place on or about 1 March 1980. At that time, Annunziato and Domenica would have been aged 10 and 14 years, respectively. Maria and Antonino purchased 107 Miller Street for $30,000. The purchase price was financed by a mortgage of $20,000 with the National Australia Bank ('the NAB'), plus a deposit of $10,000. On 23 April 1980, Maria and Antonino were registered on the title of 107 Miller Street, as was the NAB mortgage.

9 The children allege that Maria and Antonino financed the deposit and mortgage repayments in part by drawing from savings held by, or on behalf of, each of the children. The children differ in their versions as to the timing, amount and nature of the contributions drawn from their savings.

10 Annunziato deposes as to the background to the contributions from the children. He says that, over Sunday lunch on the day after the auction, Antonino told the children that he had to borrow money for the purchase and that he needed their income from their part-time and full-time jobs to pay the deposit and pay back the loan. Annunziato deposes that Rocco and Domenica contributed their earnings from their full-time employment into their National Australia Bank accounts, that he contributed his earnings from his part-time employment into his National Australia Bank account and his parents also made contributions to the children's bank accounts.

11 Annunziato deposes that in 1983, when he was aged 14, he had been working part- time in a supermarket in North Carlton for two to three years, having worked there from the age of 12. He deposes that Domenica, then aged 18, also worked full-time at the same supermarket and Rocco, then aged 20, worked for a tiling company in North Fitzroy. He does not refer to either Gina, Francesca or Caterina's commitments, if any, at the time of the purchase of 107 Miller Street.

12 Domenica and Rocco agree with these matters insofar as they relate to them. Francesca and Caterina agree with Annunziato's evidence on the basis that they have first-hand knowledge of it.

13 As 107 Miller Street was purchased in March 1980, Gina would have been aged 20, Biagio aged 19, Rocco aged 17, Domenica aged 14, Francesca aged 12, and Annunziato and Caterina aged 10. On Annunziato's evidence, he was not working part-time at the age of 10. It is most unlikely that Domenica was working full-time at the age of 14 and it is questionable that Rocco, then aged 17, was working full-time, although he may have been working part-time.

14 Gina does not refer directly to any of her siblings working, nor does she refer to any of their earnings being used towards the purchase of 107 Miller Street. She does not depose to any bank accounts for the children or whether she made any contribution towards the purchase price. In 1980, she was either engaged or recently married. She does, however, in her second affidavit, depose that she agrees with Annunziato's evidence as she was present when the events took place, which does not advance the veracity of her evidence.

15 Gina attributed the funds to cash gifts from birthdays, christenings and other events that Maria and Antonino had set aside for their benefit as follows:

My parents used their children's savings to assist with the deposit for the property. The savings came from gifts to the children for special occasions like birthdays, baptisms, communions and confirmations that my parents put away for our benefit. It was so long ago that I cannot recall exactly how much was contributed by each party. My parents kept the cash gifts at home. I cannot remember exactly where the money was kept at home.

16 Annunziato deposes that, at the time of settlement of the purchase of 107 Miller Street, his bank account and those of each of his siblings were closed and the unknown proceeds applied to assist with the settlement of 107 Miller Street. He then contradicts the statement that he had a bank account when he says that the first time he opened a bank account in his own name was after the NAB loan was repaid in about October 1990.

17 Annunziato deposes that, after the settlement of the purchase of 107 Miller Street, the family undertook substantial renovation work to the property between 1984 and 1986. He deposes that he, his brothers and his brothers-in-law all contributed to the physical work involved in undertaking the renovations, citing removal of walls and re-stumping of the house. The dates of 1984 and 1986 for the renovation work are incorrect on the basis that the purchase of 107 Miller Street occurred in March 1980. In addition, in the deed of settlement dated 3 September 1992 referred to at [31] below, 140A Miller Street was said to be the matrimonial home[1]until 1980.1

18 The renovation work was undertaken when the children were three years younger. At that time, Annunziato was aged 10, none of his sisters were married, save perhaps for Gina, who was either engaged or married. It is not clear what would have been their physical contributions to the stated renovations at their younger ages.

19 Following the renovations at 107 Miller Street, apart from Gina who was by then married, the family moved from 140A Miller Street to 107 Miller Street and it became the family home. Gina deposes that the family moved approximately 6 to 12 months after the settlement of 107 Miller Street when the renovations had been completed.

20 Annunziato deposes that, from about 1986 to 1992, the property at 140A Miller Street was used on a rent-free basis by any family members who needed it from time to time. With these dates being out by three years, it may be inferred that 140A Miller Street was used by family members from the time that the family moved to 107 Miller Street in 1980.

Alleged representations in 1980 by Antonino regarding 140A Miller Street

21 Sometime after settlement of the purchase of 107 Miller Street, the children allege that Antonino represented to the effect that, when 140A Miller Street was sold, the sale proceeds would be divided equally between Maria, Antonino and the children. Different versions of what was said by Antonino at that time were given by the children.

22 Annunziato refers to statements made by Antonino on two occasions, the first being the day after the purchase of 107 Miller Street on or about 1 March 1980 as follows:

I recall Dad stating at that time [referring to the day following the purchase of 107 Miller Street] that as we were to help him and Mum pay off 107 Miller Street, the property at 140A Miller Street was to belong to all of us.

23 The second statement was said to be in 1984 or 1985, but with Annunziato's dates out by three years, these dates would be in 1980 or 1981, when Annunziato was aged 10. Annunziato deposes that, not long after the purchase of 107 Miller Street, Antonino placed 140A Miller Street on the market for sale, the second date is likely to be sometime in 1980. Annunziato deposes that Antonino told him that, should 140A Miller Street sell, the proceeds of sale were to be divided equally towards 'myself and my siblings in our new passbook accounts'. The property did not sell and his father said to Annunziato that the property 'is never destined to sell'. The property was taken off the market.

24 In her first affidavit, Gina did not refer to Annunziato's version of events, nor did she refer to any attempt to sell 140A Miller Street in the years asserted by Annunziato. In her first affidavit, Gina deposes:

As a result of the family moving into 107 Miller Street, I can recall my father saying that 'when I sell the property (referring to 140A Miller), I will divide the money equally amongst everyone'.

I can recall my parents discussing potentially selling 140A Miller Street, I can recall my mother would say 'don't sell it because one day it will be worth many millions of dollars'. I can recall my parents and my siblings being present.

25 In her second affidavit, by her cross-referencing statements, Gina agrees with Annunziato's observations regarding an attempt to sell 140A Miller Street. The remaining children generally support the accounts of Annunziato and Gina by making similar cross-referencing statements. Francesca, Caterina and Gina, in her second affidavit, depose that they agree with Annunziato's evidence on the basis that they have firsthand knowledge of it and were 'present with [their] siblings and parents when the events took place'. Annunziato does not refer to any of them being present at the second conversation.

Alleged representations by Antonino and Maria in 1992 regarding 140A Miller Street

26 In or around 1992, Antonino and Maria again took steps to sell 140A Miller Street. The children allege that on this occasion Antonino and Maria again represented that the sale proceeds would be split into equal shares to be distributed between them and the children. At that time, the children were aged between 22 and 33 and all were married, save for Caterina.

In or around 1992, my parents came to a decision that the [sic] wanted to formalise their intention to divide up 140A Miller Street by organising legal documents and would thereafter try to sell it. My parents said 'we're going to split the money evenly between us and all you guys (referring to the children)'.

28 Gina's evidence is unclear. However, on the basis that Gina is not referring to the alleged 1980 verbal trust, Maria accepts her evidence.

29 Annunziato deposes that, in about August 1992, Antonino advised him that he required all of the children to come to 107 Miller Street to sign papers pertaining to the proposed sale of 140A Miller Street and the division of the proceeds equally among the family. He deposes that, apart from Rocco, all convened at the house and:

My father explained that following the passing of my brother Biaggio [sic] who died of cancer on the 4 May 1988, with all of us being married, with the exception of Cathy who was due to be married soon, he thought it was best to sell the property so we could take our immediate shares. Most of us had our own property with mortgages and this money would help us reduce our loans.

30 As with Gina's evidence, Annunziato's evidence is not clear. If the words 'our immediate shares' is a reference to the alleged 1980 verbal trust, Maria does not accept this evidence.

31 On 3 September 1992, a deed of settlement was executed by Maria and Antonino as settlors, and themselves and their six remaining children as donees. The recitals to the deed of settlement provide:

1. The Settlors who are also the first and second named Donees are still lawfully married to each other and are the parents of the third, fourth, fifth, sixth, seventh and eighth Donees;
2. The Settlor [sic] is the registered proprietor of the properties known as and situate at 107 Miller Street, North Fitzroy and 140A Miller Street, North Fitzroy;

1. The property known as and situate at 140A Miller Street, North Fitzroy, was used as the family or matrimonial home of the Donees until about 1980;

1. By a Contract of Sale dated the 1st of March, 1980 the Settlor [sic] purchased the property known as and situate at 107 Miller Street, North Fitzroy for the sum of $30,000-00 and borrowed the sum of $20,000-00 to assist in the purchase of the said property the remaining $10,000-00 being contributed to by the Donees and each of them more or less in equal proportions;
2. After the purchase of the property at 107 Miller Street, North Fitzroy, it was and is still used as the family and matrimonial home of the Donees and the property at 140A Miller Street, North Fitzroy was and is still used by the Donees in conjunction with the property at 107 Miller Street, North Fitzroy, as a family and matrimonial home for some members of the Donees.
3. The Donees and each of them all made contributions of approximate equality towards the mortgage re payments and other outgoings in respect of the property at 107 Miller Street, North Fitzroy;
4. The Settlor [sic] has under a verbal trust made in or about 1980 between the Settlor [sic] and the Donees held the property at 140A Miller Street, North Fitzroy upon trust for the Donees as tenants in common in equal shares;
5. The Settlor [sic] and the Donees are desirous of setting down in writing the terms of the Deed of Settlement by the Settlor [sic] and the Donees.

32 The operative terms of the deed of settlement provide:

[1] The Settlor [sic] holds the property known as and situate at 140A Miller Street, North Fitzroy, upon trust for each of the Donees as tenants in common in equal shares for their sole use and benefit absolutely.

[2] Upon the sale of the property at 140A Miller Street, North Fitzroy, the proceeds of sale be applied: -

[i] firstly to pay all costs commission and expenses of the sale;

[ii] secondly to discharge the encumbrance (if any) affecting the said property;

[ii] thirdly the balance to be divided equally amongst the Donees.

[3] The Settlor [sic] shall deal with the property at 140A Miller Street, North Fitzroy, and all such rights privileges benefits and proceeds of the said property in such manner as the Donees may from time to time direct and not otherwise.

33 On 3 September 1992, Antonino, Maria and the children signed an authority as the beneficial owners of 140A Miller Street under the deed of settlement instructing their solicitors, Gullaci & Gullaci, to apply the sale proceeds of the property, which was to be sold at auction on 3 October 1992 unless previously sold, towards payment of commission and auction expenses, costs of Gullaci & Gullaci, repayment of the mortgage and the remaining amount to be divided into eight equal parts between them. On the same date, Antonino and Maria signed a statutory declaration headed 'In the Matter of the Stamps Act' and 'In the Matter of a Deed of Settlement' between the eight of them declaring that they were the settlors under the deed and the third to eighth named donees under the deed are their children.

34 Shortly after these documents were signed, on 18 September 1992 the NAB mortgage on 107 Miller Street was discharged.

35 On 3 October 1992, 140A Miller Street was listed for auction but did not sell. Annunziato deposes that:

In October 1992 140A [Miller Street] went for Auction but was passed in as it was not even close to the reserve price we wanted.

I remember Dad being clearly upset and stating, as he did previously when the property failed to sell on the earlier occasion, 'this house is never destined to sell'.

36 By letter dated 19 October 1992, Maria and Antonino confirmed their instructions to Gullaci & Gullaci that 140A Miller Street was to remain in their joint names and that the deed of settlement was not to be lodged for stamp duty.

37 By letter dated 21 October 1992 to Maria and Antonino, Gullaci & Gullaci confirmed that 140A Miller Street had been withdrawn from sale.

38 At some time after the failure to sell 140A Miller Street in October 1992, Gina deposes to the following statements being made by her parents:

I can recall my father bringing up the sale of 140A Miller Street after 1992, he said words to the effect that 'we can sell it and buy a beach house down in Rye and everyone will be registered on title.' My mother would say 'no, we're not selling' so the family just left it.

39 On 11 February 1994, a further mortgage in favour of the NAB, securing an unknown amount, was registered on the title of 107 Miller Street. That mortgage was subsequently discharged on 10 June 1994. The children do not depose as to whether they knew of this mortgage, agreed to it, knew of the reasons for it or knew who repaid it.

40 Gina deposes that she was not involved in Antonino and Maria's finances until about 21 December 2005 when she was named as a Centrelink contact, although she was not actively involved in managing their finances. She deposes:

As far as I can recall, both of my parents advised Centrelink about the existence of the Deed for the purposes of their Age Pension and Carer Allowances. My mother's interest [in] the Miller Street property was recorded at twelve percent (12%) pursuant to her interest in the Deed. A copy of letters from Centrelink dated 17 May 2010, 23 November 2010, 9 December 2011, 15 March 2012, 7 June 2012, 1 May 2014, 24 May 2014 ... confirming that Centrelink's records show that my mother had a 12% interest in the Miller Street property.

I have not been able to source any Centrelink documentation relating to my father's assets and liabilities for Centrelink.

Discussions after Antonino's death in October 2010

41 Following Antonino's death in October 2010, Annunziato deposes that Maria, Gina and he held a discussion at 107 Miller Street about the possible sale of 140A Miller Street. He does not state any details of the discussion other than to say Maria agreed that it seemed to be sensible to sell 140A Miller Street. In her second affidavit, Gina agrees with parts of Annunziato's evidence, as do Francesca and Caterina. It is not clear as to what they agreed and it is not apparent that they were present at the discussion, noting that part of Annunziato's evidence only reflects his thoughts.

42 It appears that, as a result of some discussions, Maria and the children attended a meeting with Mr Santomartino, a long-time family friend, Annunziato's accountant and perhaps also the accountant for other family members. Mr Santomartino recalls Maria, Annunziato, Caterina, Gina, and Domenica being present but does not recall Rocco being present, although he may have been. Francesca deposes that all the children were at the meeting. Caterina deposes that her siblings and parents were present, notwithstanding that Antonino had died.

43 Mr Santomartino advised as to certain financial implications of selling 140A Miller Street, the implications that a sale would have on Maria's Centrelink pension and the capital gains tax implications on all family members. Annunziato deposes that Gina advised that Centrelink and the Australian Tax Office had been provided with copies of the deed and were aware of her parents' one-eighth share from the 1990s when her parents were eligible for the pension. In her second affidavit, Gina agrees with Annunziato's evidence. No documentary evidence was provided by Gina as to what or when she advised Centrelink or the Australian Tax Office.

Appointment of Annunziato and Caterina as Maria's financial administrators

44 In 2016, Annunziato and Caterina were appointed administrators of Maria's financial affairs. Annunziato deposes that, in the course of their administration, Caterina prepared a document for the period September to December 2016 that shows that Caterina was accounting for Maria's income on the basis that Maria was entitled to all rental income from 107 Miller Street and $330 per month of the gross rental income for 140A Miller Street. Caterina deposes that these statements are true and correct, yet this would appear to contradict Gina's position regarding Centrelink and the Australian Tax Office. There was no evidence as to how the income from 140A Miller Street was accounted for in other years and the balance of 2016.

45 The children's position is that an express verbal trust was created on or about 23 April 1980, such that Antonino and Maria held 140A Miller Street on trust for themselves and each of the children, which at that time included Biagio. They submit that there was an agreement between the family members that 107 Miller Street would be purchased using contributions from the family, that it should be inferred that there was an intention that 107 Miller Street was to become the family home and that 140A Miller Street was to become an investment property to be realised for the benefit of each family member. Until the realisation of 140A Miller Street, it was to be held on trust for the benefit of each family member.

46 Alternatively, they submit that a common intention constructive trust should be found to have come in to effect in relation to 140A Miller Street on or around 23 April 1980. They submit that it appears that the common intention of the family was that 140A Miller Street be held on trust for the benefit of the family members. This is also evidenced by the September 1992 documents that set out the terms of the trust, an intention to create a trust in 1980 and by the documents being signed by all members of the family. They submit that there is no intention to create a further or new trust in 1992 by the deed of settlement. Properly construed, it is a document setting down the terms of the trust, records the terms of the 1980 declaration of trust and provides a mechanism for the distribution of the sale proceeds.

47 Further and alternatively, they submit that Maria should be estopped from denying (if she does so deny) the existence of a trust over 140A Miller Street and, pursuant to principles of proprietary estoppel, she should be ordered to perform the promise by distributing the sale proceeds equally among the defendants, while retaining her share and that of Antonino, being 24 per cent of the sale proceeds.

48 If the Court does not find that an express trust was created, the Court should find that 140A Miller Street and, therefore, the sale proceeds be held by way of constructive trust by Maria for her benefit and that of her children.

49 The children submit that, if the Court determines that the trust did not come into existence on or around 23 April 1980, there was no trust created and Maria would be entitled to all of the sale proceeds of 140A Miller Street.

50 In deciding the questions to be answered, the Court must be satisfied that the answers are proved on the balance of probabilities. Pursuant to s 140 of the Evidence Act 2008, in deciding whether it is so satisfied, the Court must take into account the nature of the cause of action or defence, the nature of the subject matter, and the gravity of the matters alleged.

51 The affidavits relied on by the children cover the period from 1980 to the appointment of Maria's current administrator in March 2017. Most of the evidence was by way of recollection of events that took place many years ago. The written submissions of the children refer to 'some discrepancy in relation to dates' and submit that, because the conversations were conducted in Italian and given the passage of time, it is unreasonable to assume that the children would have a perfect recollection of dates and the precise nature of what was said at a particular time. There is no reference in the affidavits to the conversations being in Italian, however, assuming that is the fact, this would make no difference to the children's recollection of events. On balance, it would more likely be a benefit. The passage of time means that there are obvious difficulties arising from fading memories and a deponent's tendency to tailor the evidence to suit the case. The determination of what was said at a particular time is hindered by the lack of contemporaneous documentation, the different recollections of conversations that took place, when those conversations took place and who was present at the conversations.

52 The evidence contains unexplained discrepancies. The most significant discrepancy is Annunziato's evidence that 107 Miller Street was purchased in 1983 when he was aged 14. The title search of the property evidences Maria and Antonino as the registered proprietors of 107 Miller Street in April 1980. This means that Annunziato's evidence as to dates of certain events is substantially inaccurate by at least three years. Most of the events that he refers to occurred when he was aged 10 years. The affidavits of the other children, which cross-reference to the affidavits of Annunziato or Gina and state that they agree with his or her evidence as to dates and certain events, continue the discrepancies and do not advance the truthfulness or veracity of the evidence from the principal deponents.

53 The lack of contemporaneous documentation hinders the version of events provided by the children. For example, the children differ as to the contributions towards the payment of the deposit and, although they allege that they contributed to the repayment of the NAB mortgage, there is no documentary evidence that this occurred. Nor is the recital in the deed of settlement to the effect that the contributions to the deposit and repayments were either equal or approximately equal evidence that this occurred.

54 Further, Annunziato deposes that 140A Miller Street was used by family members rent-free until 1992. Presumably, after that date, 140A Miller Street was rented. The only documentary evidence accounting for Maria's income is for the period September to December 2016, as prepared by Caterina. The sheet allocates rent to Maria in that period. Otherwise, the children's evidence does not detail when 140A Miller Street was rented, whether they received an equal share of the rent, or how any rent was treated in tax returns for either the children, Maria or Antonino over the years since 1992. There is also no evidence as to the payment of the expenses for 140A Miller Street, such as land tax, council rates, water rates and insurance. In respect of land tax, there is no evidence of any notice being given to the State Revenue Office as to a trust holding an interest in 140A Miller Street.

55 The title search for 107 Miller Street establishes that the initial mortgage for completion of the purchase was discharged on 18 September 1992. This was shortly before the auction of 140A Miller Street was to take place on 3 October 1992. On 11 February 1994, a mortgage was registered on the title to 107 Miller Street in favour of the NAB and then discharged on 10 June 1994. As the children submit that their financial contributions towards the purchase of 107 Miller Street were such that 140A Miller Street was held on trust for the family in equal shares, it would be expected that they would consent to this mortgage or to the purpose that the borrowed funds were to be used. There is no evidence of notice of their interests being given to the NAB at any time, in particular, when the 1992 mortgage was taken out.

56 Although there is reference in Gina's affidavit to some contact with Centrelink in 2005, but not any earlier, it seems that Maria and Antonino were eligible for pensions since the 1990s. Only limited documentation is exhibited concerning the pension of Maria, which shows that at some stage, for the purpose of her pension entitlements, it was recorded that she held a 12 per cent interest in 140A Miller Street. There is no evidence as to when this information was recorded or who provided any, and if so what, documents to Centrelink. Further, with eight individuals allegedly holding equal shares in the property, the percentage would be slightly higher at 12.5 per cent. There is also no evidence of any documentation being provided to Centrelink in respect of Antonino.

57 Annunziato also deposes to the Tax Office being informed of the 1980 verbal trust in the 1990s, however, he has not referred to any documentary evidence provided to the Tax Office. He also has not referred to any evidence or record of what might have been said to Centrelink or the Tax Office after Antonino's death in 2010.

58 The many discrepancies and the lack of evidence on these various matters suggest that the alleged trust concerning 140A Miller Street was a reasonably fluid proposition that depended on the particular circumstances at the time. For example, an express trust in 1980 would assist in terms of capital gains tax liability whereas a trust in 1992 would not. Likewise, an express trust would assist Maria and Antonino in terms of the amounts of their pensions, income tax and land tax.

_Question 1 - _ As and from any, and if so what date, and by any, and if so what means, did Antonino and Maria Versaci ('the settlors') commence to hold their legal interest as the registered joint proprietors of the property situated and known as 140A Miller Street, North Fitzroy, being the whole of the land contained in Certificate of Title Volume 4620, Folio 886, upon trust ('the property trust') for themselves and their children as named donees ('the beneficiaries') as tenants in common in equal shares? In particular, did the property trust:

(a) come into existence as and from 3 September 1992 upon the execution of the original deed of settlement ('deed of settlement') bearing that date; or alternatively

(b) come into existence at some unknown date in 1980 pursuant to a so-called verbal trust?

59 The first issue in chronological order is question 1(b), that is, whether a verbal trust came into existence at some unknown date in 1980. The second issue is question 1(a), that is, whether a trust came into existence at the time of execution of a deed of settlement on 3 September 1992.

Question 1(b) - Did the trust come into existence at some unknown date in 1980 pursuant to a so-called verbal trust?

60 The children submit that an express trust came into existence on or about 23 April 1980 such that Antonino and Maria held 140A Miller Street on trust for the benefit of themselves and each of the children. They submit that, while the precise date of the express trust is unknown, it is likely to be around 23 April 1980 when Antonino and Maria became registered as joint proprietors of 107 Miller Street.

61 The children rely on Annunziato's evidence that, following the purchase of 107 Miller Street, Antonino stated, in essence, that due to the children's current and ongoing contributions to the purchase of 107 Miller Street, 140A Miller Street was to belong to the family in equal shares. They submit that Gina's first affidavit agrees that money saved by Antonino and Maria on behalf of their children was used to purchase 107 Miller Street and, although Gina was not living at home at the time, she recalls Antonino saying words to the effect that when 140A Miller Street is sold, the proceeds will be divided equally amongst everyone.

62 They submit that, given the passage of time and the fact that family conversations were conducted in Italian, it is unreasonable to assume that the children would have a perfect recollection of the dates, when certain things were said or the precise nature of what was said. They submit that it is apparent from the affidavits of Annunziato and Gina that there was a clear statement by Antonino to the effect that 140A Miller Street was to belong to the family equally and, once sold, the proceeds divided equally.

63 They submit that the deed of settlement, the statutory declaration and the authority, all dated 3 September 1992 and signed by Antonino, Maria and each of the defendants are written proof of the declaration of trust for the purposes of s 53(1)(b) of the Property Law Act 1958. They submit that Recitals G and H to the deed of settlement reflect the intentions of the parties and that the deed itself merely manifests in writing the verbal trust, in satisfaction of the requirements of the Property Law Act.

64 In the alternative, the children submit that these documents represent evidence of the verbal declaration of trust in 1980 and the clear common intention of the family that 140A Miller Street was held in equal shares to be divided equally on the sale of the property. They submit that a common intention constructive trust came into effect in or around April 1980, that Maria should be estopped from denying (if she does so deny) the existence of a trust over 140A Miller Street, and that pursuant to the principles of proprietary estoppel the plaintiff should be ordered to perform the promise made by distribution of the proceeds of sale among the children, while retaining her share and Antonino's share.

65 Maria submits there is no credible evidence from which it could be comfortably concluded that anything was said by her or Antonino in 1980 that indicates an intention to hold their interests in 140A Miller Street beneficially and, therefore, no express trust came into existence in or around 1980. Even if the Court were satisfied that the savings of the children were used to contribute to the purchase of 107 Miller Street, those contributions would not evidence conduct from which an intention to create a trust is established.

66 Maria denies that the deed of settlement evidences an intention to create an express trust in 1980. She submits that the recitals to the deed of settlement do not form a part of its operative provisions and, in any event, do not constitute evidence of the representations made therein. In particular, Recital H states that the settlors and donees are desirous of setting down in writing the terms of the deed, not the terms of an alleged verbal trust. Maria also submits that, rather than evidence of intention, Recital G is best characterised as an attempt to avoid capital gains tax payable upon an inter vivos transfer of property by way of gift, introduced by amendments made in 1985 to the Income Tax Assessment Act 1936 (Cth).

67 For an express trust to be validly constituted, there must be three requisite certainties, namely: certainty of subject matter, certainty of object and certainty of intention.[2] Where an express trust concerns an interest in land, s 53(1)(b) of the Property Law Act 1958 provides an additional requirement that, to be enforceable, the trust must be manifested and proved in writing. The trust itself may be validly constituted in the absence of a written record, and the declaration of trust need not necessarily be in writing. What is required is some written record that sufficiently evinces the existence of a trust and sets out its terms.[3]

68 The subject matter of the trust is 140A Miller Street. The certainty of the intended beneficiaries of the trust and the certainty of intention are in contention. The identity of the intended beneficiaries varies from either all of the children to the children and Maria and Antonino. Intent is identified by reference to clear language or conduct that shows a sufficiently clear intention to create a trust. Intent will be inferred from the available evidence, by reference to all of the circumstances of the relevant case, including the nature of the transaction and the relationship between the parties.[4] The authors of Jacobs' Law of Trusts in Australia characterise the relevant enquiry as follows:

The overall question is whether in the circumstances of the case, and on the true construction of what was said and written, a sufficient intention to create a trust has been manifested. It is not necessary that the creator of the trust should know that the particular relationship intended to be created is in law a trust. A trust will be created, whether or not the creator is aware of it, provided that in substance the creator's actions have the legal effect of creating the relationship which is known in law as a trust. If the language manifests an intention to create that legal effect, then a trust will be created whether the words 'trust' or 'trustee' are used or not.[5]

69 Courts ought proceed with caution and not be too astute to discover indications of an intention to create a trust.[6] Care must be taken in any given case to consider whether all of the evidence supports a conclusion that there existed a clear intention to hold property by way of trust, rather than to transfer property by some other means, for example, by way of gift.

70 Subsequent dealing with the object of the alleged trust property may be relevant evidence of intention. For example, a settlor who declares himself or herself trustee of property may not be said to have validly created a trust where they continue to deal with that property in a manner as if he or she remained the beneficial owner of it.[7] A subsequent written record of the declaration of trust may be sufficient evidence of prior intention to create a trust and, indeed, of the existence of that trust.[8]

71 The evidence is clear that 107 Miller Street was purchased in March 1980. Annunziato's recollection that the purchase occurred in 1983, and that all other events occurred thereafter, is incorrect. This necessarily affects the weight of his evidence as many of the events occurred in 1980 when he was aged 10 years.

72 Further, the evidence of Annunziato and Gina as to what Antonino said and when he said it is inconsistent. On the one hand, Annunziato says that the day after the auction of 140A Miller Street, Antonino stated to all gathered for the traditional Sunday lunch that if certain things occurred, 140A Miller Street 'was to belong to all of us'. Then when 140A Miller Street was put on the market not long after the purchase of 107 Miller Street, Antonino is alleged to have said to Annunziato that the proceeds of sale would be divided equally between the then seven children. Later, on an unknown date but 'as a result of moving into 107 Miller Street', which is likely to have occurred later on in 1980 after the renovations, he recalls Antonino saying that when 140A Miller Street is sold, he would 'divide the money equally amongst everyone'. Gina makes no reference to the alleged first attempt to sell 140A Miller Street in her first affidavit but purports to agree with this in her second affidavit in her generalised statements agreeing with Annunziato's evidence.

73 The representations alleged to have been made by Antonino do not establish an intention to create an express trust. His comments that were said to have occurred at family dinners and other such family gatherings are simply to the effect that some future proceeds of sale may be split amongst family members. The comments are not specific and do not contemplate that the proceeds of sale of 140A Miller Street would be distributed by way of trust, gift or some other mechanism. His statements are unclear as to whether only the children might benefit or both the parents and children might benefit. There is no evidence that Maria said anything on these occasions. Notably, in 1992, Maria and Antonino attended on their solicitors for the purpose of executing the deed of settlement and it may be inferred from this that if they intended more by Antonino's alleged statements, they would have sought the advice of their solicitors in 1980. At their highest, the alleged statements appear to be nothing more than statements of an intention by Antonino of a possible gift to the children when 140A Miller Street was sold, and not the parents and children as deposed by Gina.

74 Likewise, the evidence that the children, or at least funds belonging to the children, contributed towards the deposit for the purchase of 107 Miller Street does not satisfy a certainty of intention to create an express trust around the time of purchase of 107 Miller Street in 1980, nor is it evidence of an intention to hold 140A Miller Street on trust for the benefit of Maria, Antonino and the children.

75 On balance, the contemporaneous evidence relied on by the children is insufficient to satisfy an intention to create an express trust over 140A Miller Street in 1980, nor does it satisfy the certainty of the identity of the intended beneficiaries. Further, the subsequent inclusion of Recital G to the deed of settlement in 1992 referring to a verbal trust made in or about 1980 does not retrospectively evidence an intention to create an express trust over 140A Miller Street in 1980. Accordingly, the answer to question 1(b) is 'no'.

76 The alternative positions taken by the children raise contested issues of fact or allegations of breach of trust or estoppel. This proceeding is brought pursuant to r 54.02 of the Supreme Court (General Civil Procedure) Rules 2015. Pursuant to r 54.02, the Court may provide advice or directions to personal representatives on a matter of administration or management, or as to the construction of the will or trust instrument, without the need to commence an administration suit.[9] Pursuant to r 54.02(1), an application may be brought for any relief that could be granted in an administration proceeding.

77 The exercise of power by the Court to authorise, or refuse to authorise, a proposed course of action is discretionary. When asked to advise whether or not a personal representative should initiate or defend a proceeding, the Court's role is limited. It is not bound to investigate the evidence in order to make a finding as to the outcome of a proposed proceeding; it must determine only whether the proceeding should be taken, that is, whether the proposed course or action is lawful and proper.[10]

78 The procedure pursuant to Order 54 should not be used where the questions are likely to raise contested issues of fact or allegations of breach of trust by one party interested in the administration of the trust against another.[11] Contested claims such as those alleged by the children must be brought by separate writ proceedings. Such claims based on their alternative positions must be pleaded and the usual interlocutory steps taken, such as discovery, and witnesses giving viva voce evidence at trial.

Question 1(a) ** - Did the trust come into existence as and from 3 September 1992 upon the execution of the original deed of settlement?**

79 Maria relies on the following principles set out in Schreuders v Grandiflora Nominees Pty Ltd:

The principles governing the interpretation of contracts apply also to trust instruments. The High Court has 'reaffirmed the objective approach to be adopted in determining the rights and liabilities of the parties to a contract.' The meaning of the terms of a contract is to be determined by what a reasonable person would have understood those terms to mean. ...

When objectively assessing the meaning of a contractual provision, it is sometimes permissible for the court to have regard to the surrounding circumstances known to the parties at the time the contract was executed. However, if an expression in a contract is unambiguous or susceptible to only one meaning, evidence of surrounding circumstances cannot be adduced to contradict that meaning.[12]

80 Maria submits that the recitals to the deed of settlement are simply recitals and do not form part of the operative provisions of the deed. There is also no statement that the contents of the recitals to the deed are true and correct and, even if there had been such a statement, it would not constitute proof of the truth of the asserted matters.

81 Maria accepts that Recitals A and B are true representations and that there is evidence that Recital C is true and correct. In respect of Recital D, Maria accepts that there is evidence to suggest that the consideration for the purchase is correct but there is no evidence to verify the amount of $20,000 said to have been borrowed and no proof that the remaining $10,000 was contributed by the eight donees in more or less equal proportions.

82 In respect of Recital E, there is some evidence to suggest that 140A Miller Street was used by one or other of the children at various times, however, Maria notes that none of the addresses in the deed are said to be 140A Miller Street. The children's evidence does not establish the truth of Recital F, that is, that the donees made contributions of approximate equality towards mortgage repayments and other outgoings in respect of 107 Miller Street.

83 Maria does not accept that the alleged verbal trust referred to in Recital G has a proper basis of fact for the reasons set out in answer to question 1(b). Recital H simply states that the settlors and donees are desirous of setting down in writing the terms of the deed.

84 Maria notes that the recitals do not mention that, on the date that the deed was executed, the parties had also signed or were about to sign an authority to place 140A Miller Street on the market for sale and to authorise the distribution of the net sale proceeds to themselves equally. Antonino and Maria had also signed a statutory declaration for the purposes of the Stamps Act 1958. Maria submits that it is appropriate to have regard to these surrounding circumstances in this case.

85 Maria submits that, properly interpreted in light of the circumstances at the time of the execution of the deed of settlement, the deed constitutes a declaration of no more than a bare trust set down by Maria and Antonino as settlors. Pursuant to that trust, their joint proprietorship over 140A Miller Street was held on trust for themselves and each of the children for the purpose of effecting a sale of the property and a distribution of net proceeds in accordance with the declared beneficial interests.

86 In accordance with the principles of interpretation, the three clauses of the deed of settlement are to be read together for their meaning. The deed does not set out any rights, obligations, powers or duties of the parties in regard to the ongoing ownership of 140A Miller Street. The deed simply provides for the settlors to deal with the rights, privileges, benefits and proceeds of 140A Miller Street 'in such manner as the Donees may from time to time direct and not otherwise'.

87 Having regard to the terms of the deed interpreted in light of the circumstances existing at the time of execution, clauses 1 and 2 together constitute a declaration of bare trust by Antonino and Maria as settlors pursuant to which they hold their registered joint proprietorship in 140A Miller Street on trust for themselves and each of their six children beneficially as tenants in common in equal shares to effect a sale of the property forthwith and upon a sale having occurred to effect a distribution of the net proceeds of sale in accordance with the declared beneficial interests.

88 Accordingly, the answer to question 1(a) is 'yes'.

Question 2 - If 'no' to question 1(b) and 'yes' to question 1(a), is the copy of the deed exhibited as exhibit 'SL3' to the affidavit of Suzanne Mary Lyttleton sworn November 2018 ('copy deed') a true copy of the lost original sufficient to prove the existence of the original deed by secondary evidence?

89 An answer to question 2 is no longer necessary as, after the proceeding commenced on 16 November 2018, the missing original unstamped deed of settlement was located by Gina around 3 December 2018.

90 With the production of the original deed, question 3 was amended in the plaintiff's submissions as follows:

Was the deed constituted for the sole or predominant purpose (stating which) of the settlors holding 140A Miller Street on trust for sale and the net sale proceeds to be divided equally between the donees in accordance with clause 2?

91 The task of the Court in interpreting the purpose of a trust is to ascertain the intention of the settlor at the time it is constituted.[13] Where the terms of the trust are contained in a written document, the Court must interpret that document by applying the usual canons of construction, that is, by giving the words of the deed their ordinary and natural meaning in the context of the document as a whole.[14] The instrument is to be interpreted objectively, by reference to what a reasonable person would have understood its terms to mean.[15] Although it is permissible to consider the surrounding circumstances known to the parties, those circumstances should not be adduced to contradict the unambiguous terms of the instrument.[16]

92 Maria submits that the sole or predominant purpose of the trust was to divide the beneficial ownership of 140A Miller Street equally between Maria, Antonino and their surviving six children and to forthwith sell the property and divide the net proceeds equally in accordance with the beneficial ownership. In effect, the correct inference is that the six children would receive an early inheritance. In support of her submission, Maria referred to the context in which the deed of settlement was drawn and executed by reference to the evidence of Gina and Annunziato.

93 The children made no submissions in respect of question 3 as their position is that if no trust arose in respect of 140A Miller Street in 1980, there is no trust at all.

94 The statements referred to by Gina in her first affidavit at [27] above and by Annunziato in his affidavit at [29] above were said to have been made 'in or around 1992' in Gina's case and 'in or around August 1992' in Annunziato's case. Although these statements are general, they appear to relate to the deed of settlement in 1992, not the asserted 1980 verbal trust.

95 At the time of the statements, the circumstances of the children were that, save for Caterina who was about to marry, they were all married and paying off mortgages. The statements made by Gina and Annunziato support the conclusion that the sole purpose of the deed of settlement was to divide the beneficial ownership of 140A Miller Street equally between the parents and their remaining six children and to sell the property and divide the net sale proceeds equally. It may be inferred from the circumstances that the children effectively would receive an early inheritance which would assist them in paying off their mortgages.

96 The trust, as evidenced by the deed of settlement, was constituted for the sole purpose of 140A Miller Street being held by the settlors on trust for sale with the net sale proceeds being divided equally among the donees in accordance with clause 2 of the deed of settlement.

Question 4 - If 'yes' to question 3, in circumstances where:

(a) the property was put up for sale by the settlors on 3 October 1992 but did not sell; and

(b) shortly afterwards the settlors instructed their solicitors that the property was to remain in their joint names and that the (original) deed was not to be lodged for stamp duty (which instruction was given effect to); and

(c) shortly thereafter, the settlors instructed their solicitors that the property had been withdrawn from sale (which it was);

98 Maria submits that the trust constituted in 1992 totally failed when she and Antonino abandoned the sale of 140A Miller Street. It is uncontentious that no further discussion or attempt to sell the property was made until after Antonino's death in October 2010. Further evidence of abandonment is found in the instructions given by Maria and Antonino to their solicitors to remove the property from sale and not to lodge the deed of settlement for the payment of stamp duty.

99 Antonino's pessimism about 140A Miller Street being destined not to sell together with Maria's long-standing negative attitude to selling 140A Miller Street meant that they abandoned selling the property in both the short and long term. They took no further action to sell 140A Miller Street between the time of the failed auction in October 1992 and Antonino's death in October 2010.

100 Within that time frame, neither Maria nor Antonino gave any direction to the children and the children gave no direction to the parents pursuant to clause 3 of the deed of settlement in relation to any of the benefits and burdens of co-beneficial ownership of 140A Miller Street. There is no evidence that the children received an equal share of the rent when 140A Miller Street was rented from an unknown date. The rent derived from September 2016 to January 2017 was allocated to Maria for her needs. There is no evidence that the children incurred an equal share of the expenses relating to 140A Miller Street - such as land tax, council rates, water rates or insurance - nor that notice was given to State Revenue that a trust had an interest in 140A Miller Street. There is also no evidence that the children consented to the 1994 mortgage, and no evidence as to how the borrowed moneys were applied or by whom.

101 Accordingly, the answer to question 4 is that the purpose of the trust constituted in 1992 totally failed.

Question 5 - If 'yes' to question 4, was the property thereafter held on a resulting trust beneficially in favour of Antonino and Maria and, if so, were their beneficial interests held jointly or as tenants in common in equal shares?

102 Maria submits that, where property is conveyed on trust for a specific purpose that fails, the beneficial interest in the trust property results to the settlor. In Jacobs' Law of Trusts it is stated that resulting trusts arise 'where express trusts fail ... because of total failure of the purposes for which the trust was constituted'.[17]

103 The authors referred to Essery v Cowland[18] and Re Ames' Settlement; Dinwiddy v Ames.[19] In Essery v Cowland, a deed was executed in consideration of an intended marriage whereby certain property of the intended wife had been transferred by her to trustees to be held on trust for the benefit of the intended wife and husband and the issue of the intended marriage. The marriage was never solemnised but the parties did live together and had three children. If they now married, their intention to provide for all their issue would be defeated. They brought an action against the trustees to obtain a transfer of the property to the intended wife. Justice Pearson held that the contract to marry had been absolutely put to an end and that the property be transferred back to the intended wife.

104 In Re Ames' Settlement, funds were settled on the usual trusts of a marriage settlement by the husband's father. The marriage was solemnised and the funds paid and invested by the trustees with the husband taking the first life interest. The parties lived together but subsequently a decree of nullity was made on the wife's petition. The wife subsequently remarried and released all of her interests under the settlement. The settlor died a few years later and the husband continued to receive the income until his death. The trustees sought the advice of the Court over to whom they should pay the funds. The Court determined that, the marriage having been void ab initio, there was a total failure of consideration and the funds were held on trust for the settlor's executors.

105 While the authors noted that Re Ames' Settlement was criticised in Westdeutsche Landesbank Girozentrale v Islington London Borough Council,[20] the reference to the decision was by Lord Brown-Wilkinson, who described the judgment as 'very confused'. However, the result was not criticised, that is, the fund was vested in trustees on trusts that had failed and, therefore, the moneys were held on a resulting trust.

106 Likewise, Professor Dal Pont states that, where property is conveyed on trust for a specific purpose that fails, the beneficial interest in the property results to the settlor,[21] referring to the classic case of Clarke v Terry.[22] This was a case where a Crown grant to trustees for the specific purpose of investigating claims to land failed because the investigating Commissioner could not reach a decision and it was held to revert to the Crown on a resulting trust.

107 Accordingly, the answer to the first part of question 5 is that, as the trust over 140A Miller Street was for the specific purpose of selling it on 3 October 1992, and as the property did not sell, the purpose of the trust failed and the beneficial interest in 140A Miller Street resulted to Antonino and Maria.

108 The second part of question 5 asks whether Antonino and Maria hold their beneficial interests jointly or as tenants in common in equal shares.

109 The principal features of a joint tenancy are the right of survivorship and the 'four unities' being the unities of title, possession, interest and time. A joint tenancy may be severed in a number of ways.[23] In Australian Real Property Law, the authors refers to the following position:

[W]here a joint tenant declares himself or herself a trustee of the interest for another, equity will enforce the trust providing there has been compliance with the statutory requirements in relation to declarations of trust. The declaration of trust severs the joint tenancy in equity.[24]

110 In the Canadian decision of Re Sorenson and Sorenson cited therein, the Appellate Division of the Alberta Supreme Court held a declaration of trust by a wife to her son severed the joint tenancy as between the husband and wife.

111 In Public Trustee v Pfeiffle, the Full Court considered an appeal where the trial judge held that a joint tenancy was not severed by the terms of settlement entered into between a husband and wife.[25] Kaye J referred to the four unities of a joint tenancy, the manner in which a joint tenancy is severable and what should be considered in the enquiry as to whether the joint tenancy is severed. In respect of the last point, his Honour stated:

The enquiry to be made in the present matter is therefore whether the joint tenancy of the two properties was severed in any one or more of the three recognised ways. The agreement does not contain a term by which it is expressly provided that the joint tenancy is agreed or acknowledged to be severed. Nevertheless, the manner in which it was agreed that the properties should be dealt with might operate to bring about severance, or might reveal the parties' shared intention to sever their joint proprietorship.[26]

112 The Full Court determined that an agreement for sale and division of the properties constituted a manifestation of intention to end a joint tenancy notwithstanding that the sale of the properties did not occur. As with the deed of settlement in this case, the intention was for 140A Miller Street to be held on a trust for sale forthwith and the equal division of proceeds between the settlors and the donees. These terms are inconsistent with unity of title and interest and severs the joint tenancy.

113 Accordingly, the answer to the second part of question 5 is that the beneficial interests of Antonino and Maria are held as tenants in common in equal shares.

6 If Yes to questions 1(a) and 2, but no to questions 3, 4 and 5:

1. was the original deed a document which ought to bear a stamp or be denoted as prescribed under the Stamps Act 1958 ('Act'); and
2. if yes, pursuant to s 9(1) of the Act, does the absence of a stamp or prescribed denotation on the original deed result in the original and the copy deed, being invalid until, in the circumstances of the case, the copy deed is stamped or denoted as prescribed; and

1. if yes, pursuant to s 10 of the Act, in the circumstances of the case, is the Court not permitted to allow the copy deed to be used in the proceeding until it has been duly stamped or denoted as prescribed?

1. If Yes to question 6, having regard to the instructions given, on or about 19 October 1992, by Antonino and Maria Versaci to their solicitors Gullaci & Gullaci that the original deed was not to be lodged for stamp duty was the original deed not stamped through mistake or inadvertence such as to enliven the Court's jurisdiction pursuant to s 9(2) of the Act?
2. If Yes to question 7, will the Court order that the copy deed be stamped with stamps of such amount as it thinks reasonable and, if yes, pursuant to s 9(3) of the Act, on the copy deed being stamped accordingly, would it and the proceeding herein henceforth be valid as if the original deed had been stamped properly in the first place?
3. If No to question 7, is the plaintiff under any legal obligation to submit the copy deed to the Commissioner for State Revenue and seek that it be assessed for duty and to pay any duty so assessed?

115 Questions 6 concerns the application of stamp duty to the 1992 deed of settlement. Questions 7, 8 and 9 also relate to the deed and are now to be determined by reference to the original deed of settlement.

116 The statutory regime governing the application of stamp duty at the time of execution of the deed of settlement on 3 September 1992 was the Stamps Act 1958 ('the Act'). The Act has since been repealed and replaced by the Duties Act 2000 (Vic).[27] According to its transitional provisions, the Duties Act applies only to instruments which were executed on or after the date of commencement of that Act, which was 1 July 2001.[28] Despite its repeal, the Act remains applicable for the purposes of this proceeding by operation of the saving provision contained in s 14(2) of the Interpretation of Legislation Act 1984.

Subject to the exemptions contained in the Third Schedule and in any Acts for the time being in force, there shall be charged for the use of Her Majesty upon the several instruments specified in the said Schedule, the several duties and additional duties therein specified.

118 As at the date of execution of the deed of settlement, the relevant part of the Third Schedule provided for stamp duty of $200 upon an 'instrument of settlement', which was defined in the Third Schedule as follows:

IX - Instrument of Settlement

An instrument of settlement includes:

(a) any instrument, other than a will or codicil, whether voluntary or upon any good or valuable consideration other than a bona fide adequate pecuniary consideration and whether revocable or not whereby any property is settled or agreed to be settled in any manner whatsoever;

(b) any instrument declaring that property vested in the person executing the same shall be held in trust for the person or persons mentioned therein;

(c) any instrument whereby an existing trust created verbally is acknowledged evidenced or recorded either by the creator of the trust or by the trustee in any case where, if the trust had originally been created by an instrument, stamp duty would have been chargeable upon such an instrument under either paragraph (a) or paragraph (b) above.

119 Stamp duty payable on an instrument of settlement was to be paid by the settlor of the trust to the Comptroller of Stamps with payment required within three months of the date of execution of the instrument of settlement.[29]

120 Subject to certain exceptions, an unstamped document was deemed by the Act to be invalid. As at the date of execution of the deed of settlement, s 9 of the Act provided:

(1) Subject to this section, a document that ought, under this Part, to bear a stamp or be denoted as prescribed, shall not be of any validity unless it is properly stamped or denoted as prescribed.

(2) If any such document is through mistake or inadvertence received lodged filed or used without being properly stamped, or if it appears upon any such document being tendered in evidence or for any other purpose that the same through inadvertence has not been properly stamped, a court may if it thinks fit order that the same be stamped with stamps of such amount beyond the fee due thereon as he thinks reasonable, not exceeding five times the amount of stamp which would have been impressed or affixed thereon as is in such order directed.

(3) On such document being stamped accordingly the same and every proceeding relative thereto shall be valid as if such document had been properly stamped in the first instance.

Except in criminal proceedings any document which ought to be but is not, under this Part, duly stamped or denoted as prescribed shall not nor, though no objection is raised thereunto, shall any court allow such document to be used until such document has been first duly stamped or denoted as prescribed.

122 Maria submits, and the Court accepts, that it follows from these provisions that:

(a) the deed of settlement falls within the definition of 'instrument of settlement' under the Third Schedule to the Act, and is required to bear stamp duty of at least $200;

(b) the stamp duty is payable by the settlor, and given the death of Antonino, this means Maria, by her administrator;

(c) unless and until the original deed is stamped, it is invalid and cannot be used in evidence;

(d) Gina, being in possession of the original deed of settlement, ought deliver it up to Maria's administrator for the purpose of stamping; and

(e) it was because of specific instructions given by Maria and Antonino as settlors to their solicitors, Gullaci and Gullaci, that the original deed of settlement was not submitted for assessment of stamp duty. The absence of a stamp cannot be attributed to mistake or inadvertence so as to enliven s 9(2) of the Act.

123 On any view, the deed of settlement falls squarely within the definition of 'instrument of settlement' pursuant to the Third Schedule to the Act and attracts stamp duty of $200. That stamp duty is payable by the settlor of the trust, namely, Maria, by her administrator.

124 Pursuant to s 10 of the Act, the deed of settlement remains unstamped and cannot be used as evidence in this or any other proceeding. As the deed of settlement is in the possession of Gina, it is proper and appropriate that she deliver it up to Maria for the purpose of stamping it. When the stamp is affixed to the deed of settlement and the appropriate fee paid, the deed of settlement will be treated as valid as if it had been properly stamped following its execution in 1992.

125 The Court has provided the answers to the nine questions in the originating motion. The parties are to forward an agreed form of orders and proposed orders for the costs of the proceeding.

MARIA VERSACI (by her administrator SUZANNE LYTTLETON)

[1] Recital C of the deed of settlement.

[2] Kauter v Hilton [1953] HCA 95; (1953) 90 CLR 86, 97 (Dixon CJ, Williams and Fullagar JJ); Korda v Australian Executor Trustees (SA) Ltd [2015] HCA 6; (2015) 255 CLR 62, 71 [7] (French CJ), 123 [204] (Keane J).

[3] Gentsis v Forty-first Advocate Management Pty Ltd [2004] VSC 398, [89] (Hollingworth J); Secretary, Department of Social Security v James [1990] FCA 150; (1990) 95 ALR 615, 622 (Lee J).

[4] Inland Revenue Commissioners v Raphael [1935] AC 96, 142-3 (Lord Wright); Trident General Insurance Co Ltd v McNiece Bros Pty Ltd [1988] HCA 44; (1988) 165 CLR 107, 121 (Mason CJ and Wilson J), 148-9 (Deane J), 156 (Dawson J).

[5] JD Heydon & MJ Leeming, Jacobs' Law of Trusts in Australia (LexisNexis Butterworths, 8th ed, 2016), 50 [5-02].

[6] Re Schebsman; Ex parte Official Receiver v Cargo Superintendents (London) Ltd [1944] Ch 83, 104 (Du Parcq LJ); Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253, 272 [49] (Gummow and Hayne JJ); Bahr v Nicolay (No 2) [1988] HCA 16; (1988) 164 CLR 604, 618-19 (Mason CJ and Dawson J); Trident General Insurance Co Ltd v McNiece Bros Pty Ltd [1988] HCA 44; (1988) 165 CLR 107, 120-1 (Mason CJ and Wilson J), 146-7 (Deane J), 156-7 (Dawson J).

[7] Hughes v Stubbs [1842] EngR 877; 66 ER 1119, 1120 (Wigram VC); Hyhonie Holdings Pty Ltd v Leroy [2003] NSWSC 624, [35]-[36] (Young CJ).

[8] Draper v Official Trustee in Bankruptcy [2006] FCAFC 157; (2006) 156 FCR 53, 64 [39] (Mansfield J), 89-90 [159] (Besanko J).

[9] Re Atkinson (deceased) [1971] VicRp 73; [1971] VR 612, 615 (Gillard J). See also GE Dal Pont, Equity and Trusts in Australia (Thomson Reuters, 7th ed, 2018) 688-90 [23.170]; Heydon & Leeming, Jacobs' Law of Trusts in Australia (n 5), 532-5 [21]-[34].

1. [10] GE Dal Pont and KF Mackie, Law of Succession (LexisNexis Butterworths, 2nd ed, 2017) 460 [13.36], citing Re Atkinson (deceased) [1971] VicRp 73; [1971] VR 612, 616 (Gillard J); Salmi v Sinivuori [2008] QSC 321, [16] (Lyons J).

[11] Tsaknis v Lilburne [2010] WASC 152, [41] (Heenan J).

[12] [2016] VSCA 93, [12], [15] (Kyrou, Ferguson and McLeish JJA) (citations omitted).

[13] Re Gulbenkian's Settlements; Whishaw v Stephens [1970] AC 508, 522 (Lord Upjohn).

[15] Schreuders v Grandiflora Nominees Pty Ltd [2016] VSCA 93, [12] (Kyrou, Ferguson and McLeish JJA).

[16] Ibid [15] (Kyrou, Ferguson and McLeish JJA), citing Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337, 352 (Mason J); Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd [2015] HCA 37; (2015) 256 CLR 104, 116 [48], 117 [52] (French CJ, Nettle and Gordon JJ).

[17] Heydon & Leeming, Jacobs' Law of Trusts in Australia (n 5) 208 [12.05].

[18] (1884) 26 Ch D 191.

[19] (1946) Ch 217 ('Re Ames' Settlement').

[20] [1996] UKHL 12; [1996] AC 669, 715 (Lord Browne-Wilkinson).

[21] Dal Pont, Equity and Trusts in Australia (n 9), 251-2 [26.30].

[22] (1859) 1 Legge 753.

[23] See, for example, Re Wilson [2019] VSC 211, [39] (Derham AsJ), citing Williams v Hensman [1861] 1 EngR 701; (1861) 70 ER 862, 867.

[24] AP Moore, S Grattan & L Griggs, Australian Real Property Law (Thomson Reuters, 6th ed, 2015) 586 [12.235], citing Re Sorenson and Sorenson (1977) 90 DLR (3d), 26; Oglivie v Littleboy (1897) 13 TLR 399, affd Ogilivie v Allen (1899) 15 TLR 294.

[25] [1991] VicRp 3; [1991] 1 VR 19.

[27] See Duties Act 2000 (Vic) s 284, which was itself repealed in a clean-up of legislative provisions by s 18 of the Statute Law Revision Act 2007 (Vic).

[28] Duties Act 2000 (Vic) sch 2 cl 4.

[29] Stamps Act 1958 (Vic) ss 85(1), 85(2).