mixed. VCAT ordered the property be sold under the control of the principal registrar (to the exclusion of the parties); after assessing contributions, credibility and conduct, the Tribunal exercised its wide...
Key principles
VCAT may order sale of co-owned land under s 228 of the Property Law Act 1958 (Vic) and may adjust co-owners' interests to take account of amounts payable by co-owners during the...
In exercising the discretion under s 233 the Tribunal should take account of actual payments made by co-owners (rates, mortgage repayments, purchase money, instalments or other...
An occupancy rent pursuant to s 233(3) can only be ordered in the limited statutory circumstances set out in that subsection; where those circumstances (exclusion from...
Where the statutory discretion is wide, the Tribunal may also take into account non-exhaustive matters including conduct of the parties (delay, obstruction), exclusive occupation...
Issues before the court
Whether VCAT should order sale of the co-owned property and, if so, how the net proceeds should be divided between three registered owners.
Plain English Summary
VCAT ordered the family home sold under the principal registrar's control. The parents claimed they had paid most of the mortgage and upkeep and sought the whole net proceeds; the daughter claimed she had made many cash payments but lacked documentary proof and suffered serious credibility findings. The Tribunal assessed actual payments under s 233 of the Property Law Act, considered conduct and exclusive occupation, and exercised its discretion to distribute any equity according to the registered shares (one-third each) rather than reallocating the bulk to the parents. Costs were reserved.
AI-generated legal information, not legal advice. Zoe can make mistakes. Check the cited source, and for advice about your situation consult a qualified Australian lawyer.
Deep Dive
1,717 words · generated 26/06/2026
What happened
This proceeding concerned a family dispute over beneficial ownership and the division of proceeds of sale of a house at Caroline Springs. The registered owners were Mr and Mrs Stephen and Irene Protyniak and their daughter, Paula (the first respondent). The parents (applicants) sought an order for sale under s 228 of the Property Law Act 1958 (Vic) and sought an adjustment of the parties' interests so that the parents would receive all or most of the net proceeds, on the basis that they had funded the purchase, loan repayments, insurance, rates, building defects, and other outgoings. The daughter resisted, claiming she had made substantial cash payments toward the mortgage and improvements and that she had a beneficial interest.
Whether contributions to mortgage repayments are to be assessed by reference to who was liable on paper (registered liability) or by reference to...
Whether an occupancy rent should be imposed against the occupying co-owner.
How to balance documented payments against uncorroborated oral claims of cash payments when quantifying contributions.
Cited legislation
No linked legislation citations have been extracted yet.
At hearing the Tribunal (Deputy President M.F. Macnamara) conducted a credibility and evidentiary assessment. The parents produced documentary records of many payments; the daughter relied principally on oral evidence of cash payments and admitted inconsistent affidavits filed in family law proceedings. The Tribunal concluded the parents' documentary case was generally reliable and that the daughter's evidence was gravely impaired by inconsistent sworn statements and lack of supporting documentation (see Conflicts ¶3–¶5). The Tribunal ordered sale under the control of the principal registrar and, after weighing contributions, conduct and exclusive occupation, decided that any mortgagors' equity should be divided according to the registered title: one-third to each registered owner. Costs were reserved and short minutes were directed to be lodged (Order; Conclusions).
Why the court decided this way
Three axes of reasoning determined the outcome.
Statutory framework and starting presumption. The Tribunal began with the legal presumption that a registered co-owner is a full beneficial owner (Conclusions ¶3). The operative statutory powers were s 228 (power to order sale) and s 233 (power to adjust co-owners' interests and the matters to which VCAT must have regard). The Tribunal emphasised that s 233(2)(c) requires consideration of payments by co-owners of amounts beyond their proportionate share (Conclusions ¶1–¶2). That statutory lens shaped the assessment of contributions.
Evidence-based quantification of contributions. The Tribunal accepted the parents' documentary ledger of payments and rejected much of the daughter's alleged cash payments because they were unsupported and contradicted by prior sworn statements in other proceedings (Conflicts ¶1–¶5; Conclusions ¶3). The Tribunal thus quantified the daughter's mortgage repayments at $74,099.18 (subject to adjustments) and allowed a modest further allowance ($7,000) for some unproved improvements (Conclusions ¶2–¶3). The parents' outlays were accepted as being substantially larger.
Discretion and equitable considerations. Despite the parents' larger net outlays, the Tribunal exercised the broad discretion under s 233(1) to take into account other equitable factors: the original purpose of the acquisition (to 'advance' the daughter and her children), the daughter's exclusive occupation, and the daughter's obstructive conduct during proceedings. The Tribunal noted the narrow statutory circumstances in which an occupancy rent can be imposed under s 233(3) and declined to impose one here (Conclusions ¶4–¶6). Balancing these matters, the Tribunal concluded fairness required that registered shares remain the basis for distributing any mortgagors' equity (Conclusions ¶6–¶7).
Two legal-policy points also influenced the analysis. The Tribunal contrasted the High Court decision in Calverley v Green (which can treat co-mortgagors as both having contributed for resulting trust purposes even if only one made repayments) with the statutory regime under Part IV of the Property Law Act, and treated the statute as adopting the community-oriented approach that actual repayments are the relevant measure for s 233 adjustments (Conclusions ¶1).
Before and after state of the law
Before: The High Court in Calverley v Green established that in some resulting trust contexts, the position of co-mortgagors might be assessed by legal liability rather than who actually made repayments. That decision has long influenced equitable analyses of contribution where parties are both co-mortgagors.
This decision: Protyniak v Henry does not overrule Calverley (VCAT has no overruling power), but it interprets the Property Law Act (Part IV) as requiring a different practical approach when VCAT exercises its statutory power to adjust co-owners' interests under s 233. The Tribunal expressed that s 233(2)(c) makes actual payments the relevant inquiry for adjustment, and that this statutory scheme adopts the "popular view" that those who actually make repayments should be treated as having contributed (Conclusions ¶1–¶2). In short, for statutory adjustments under s 233 the Tribunal will primarily look to actual contributions and documented outlays.
After: The case is an example of how VCAT will approach s 233 disputes: robust documentary evidence of payments, careful credibility assessment, and the exercise of a broad discretion that can incorporate non-exhaustive equitable considerations (occupation, conduct, original purpose). It signals that even when payments are unequal, registered shares may be preserved where equitable considerations and the original purpose of the acquisition weigh against a reallocation.
Key passages with plain-English translation
Selected passages from the Tribunal's reasons, with plain-English translations and references.
"I start therefore with the presumption that Ms Henry should be treated as a full beneficial owner of the property." (Conclusions ¶3)
Plain English: Being on title counts. The Tribunal begins from the assumption that a named owner on the certificate of title has a beneficial interest unless evidence shows otherwise.
"It is clear from the terms of s 233(2)(c) ... the person or persons who make the repayments under the mortgage are taken to be the ones who contributed to the purchase in the relevant proportions." (Conclusions ¶1–¶2)
Plain English: Under the statute, the Tribunal will normally credit the person who actually paid mortgage instalments or other outgoings when deciding how to adjust ownership shares.
"The result of all this is Ms Henry comes before the Tribunal as a self confessed perjurer willing to sware falsely to get her way in legal proceedings." (Conflicts ¶3)
Plain English: The Tribunal made a severe credibility finding against the daughter, which meant her unsupported claims were treated skeptically.
"I believe however that it may be appropriate to consider ... mortgagors' equity should be divided as to three quarters in favour of the applicants and as to one quarter in favour of Ms Henry." (Conclusions ¶6)
Plain English: Initially the Tribunal thought the parents' greater payments might justify a big allocation in their favour.
"In all those circumstances the just outcome ... is that the allocation ... should follow the entitlements as registered on title namely, one third, one third, one third." (Conclusions ¶7)
Plain English: After balancing all factors, the Tribunal decided that fairness required keeping the registered shares intact, so each registered owner gets one-third of any mortgagors' equity after sale and mortgage discharge.
What fact patterns trigger this precedent
This decision will be relevant in cases with the following features:
Property held by family members where title is in joint names but the parties dispute beneficial proportions.
Situations in which one or more co-owners claim to have made undocumented cash payments while other co-owners have documentary evidence of payments.
Cases where one co-owner has had exclusive occupation for an extended period and the others seek compensation or sale.
Disputes brought under s 228/s 233 of the Property Law Act where the Tribunal must both order sale and assess adjustments to co-owners' interests.
Situations where one co-owner's conduct before or during litigation (delay, obstruction, false affidavits) is a factor in equitable balancing.
The key trigger is a s 233 application where parties' contributions and conduct differ and the evidentiary record is mixed.
How later courts have treated it
This is a VCAT decision. It is a persuasive administrative tribunal decision about interpreting and applying ss 228 and 233 of the Property Law Act. Later courts and tribunals will treat it as persuasive authority on:
The method of quantifying contributions under s 233, particularly the emphasis on actual documented payments.
The Tribunal's broad discretionary power to weigh equitable factors beyond the statutorily enumerated list, provided s 233(2) mandatory considerations are addressed.
The limited circumstances in which occupancy rent may be awarded under s 233(3).
Because this is a tribunal decision rather than binding appellate authority, higher courts remain free to adopt different approaches. Nevertheless, practitioners in VCAT real property matters can expect this reasoning to be cited as a practical example of the Tribunal's approach to s 233 disputes where evidence differs in quality between parties.
Still-open questions
Several issues remain open or uncertain after this decision:
Interaction with Calverley v Green: The Tribunal treated s 233 as effecting a different practical approach to contribution assessment than Calverley. A higher court might be required to reconcile Calverley with the statutory regime where legal liability diverges from actual payments for equitable accounting under s 233.
Quantification methodology: The Tribunal calculated contributions by reference to amounts actually paid and made holistic allowances (for example, accepting 50% of some unproven items). The decision does not lay down a precise, replicable algorithm for apportionment in close cases; disputes over whether to net redraws and withdrawals or to treat credit balances differently may recur.
Weight of conduct and original purpose: The Tribunal took into account the original purpose of advancing the daughter and her exclusive occupation in declining an occupancy rent and in deciding to preserve registered shares. The precise weight to be accorded to such purposive or conduct-based considerations relative to documented financial contributions is not defined by statute and remains a matter of judicial/tribunal discretion.
Occupancy rent thresholds: The decision confirms s 233(3) limits but leaves open details about how strictly those statutory categories should be interpreted; whether a tribunal may infer 'detriment because it was not practicable to occupy' in marginal fact scenarios remains unclear.
Evidentiary standards for informal family loans: The case shows that undocumented cash payments are highly vulnerable to rejection where credibility is impaired and contemporaneous records are lacking. But the decision does not settle what minimum corroboration will suffice in otherwise credible circumstances; practitioners should preserve contemporaneous records, receipts, bank withdrawals and transfers to resist discounting.
Practical takeaways for practitioners: insist on documentary evidence of payments, prepare to address credibility issues caused by inconsistent prior affidavits, and frame submissions under s 233 in two stages, mandatory statutory considerations (s 233(2)) and broader equitable balancing (s 233(1)), addressing both with evidence and submissions.
Judgment (15 paragraphs)
[1]
Protyniak v Henry (Real Property) [2009] VCAT 8 (8 January 2009)
[2]
Real Property List; Part 4 Property Law Act1958; Ownership dispute; Application for sale of co-owned property and division of proceed to which entitlements of parties should be adjusted having regard to contributions of parties to purchase price, mortgage repayment, insurance, miscellaneous improvements and maintenance and conduct of the parties.
Within 14 days of this day the parties must bring in short minutes to give effect to these reasons.
Adjourned to directions hearing at 9.30am on 23 January 2009.
Costs reserved.
[5]
Mr S Bird of counsel, instructed by Kempsons solicitors
[6]
Mr & Mrs Protyniak have four daughters, the eldest Paula (Ms Henry) who is the first respondent in this proceeding was born in 1971. The Protyniaks other three daughters are Nikki, Rebakah and Katrina.
Ms Henry's first husband was John Bouboukis. According to Mr Protyniak he lent Ms Henry some $2,000 in 1998 to assist her and her then husband to 'make ends meet'. Mr Protyniak says that Ms Henry paid 15 instalments of $126.77 making a total of $1,901.55.
Mr Protyniak says that in late 1998 Ms Henry suggested that he buy an investment company which she and her husband John could rent from him. Mr Protyniak said:
[7]
Irena (that is his wife, the second applicant in this proceeding) and I believe this was a great opportunity for Paula and John to be financially responsible.
[8]
Mr Protyniak said that his wife began searching for property around Caroline Springs 'as Caroline Springs seemed to be a developing area'. He and his wife decided to buy a vacant block of land at Islington Place 'on the basis that we would construct a dwelling on it'.
Mr Protyniak paid a holding deposit of $500.00 to the solicitors for the vendor Delfin Development Pty Ltd the balance of the deposit $2,200.00 was paid by Mr & Mrs Protyniak on 6 February 1999.
The particulars of sale produced as an exhibit to Mr Protyniak's affidavit do not show a date. They provide for settlement on 30 March 1999 and presumably the contract was made on the date when the balance of the deposit was paid. The purchasers shown on the contract of sale are Mr and Mrs Protyniak and or nominee.
Mr Protyniak said that when he signed the Contract of Sale "he had no intention ... that Paula would be on Title." He said however that when he approached the Commonwealth Bank of Australia for a home loan the manager told him that the age of Mr and Mrs Protyniak would preclude them from obtaining a 25 year loan. He then approached his daughter who he said suggested that they apply to the National Australia Bank Limited for a loan. She was then an employee of that bank and if she was shown as a co-purchaser she would be able to obtain a loan at staff rates and her income and age would remove the problem which had obstructed success of the loan application to the Commonwealth Bank. According to Mr Protyniak, "Paula at all times would only be on Title so we could obtain the home loan and ... she only held her interest on trust for us."
Ms Henry's account of these events is quite different. She said the genesis of the project to acquire the Caroline Springs property was to be found in the difficulties she was encountering with her then husband John. She said that in September 1998 she was speaking to her parents at their home as she wished to exit her marriage and wanted a home to live in. She said, "I asked my parents if they could assist me by lending me the bond and first months rent for a new rental property." She said that her father suggested rather than wasting money on rent she should "look for a place to buy." She says her mother said that her parents would lend her the deposit "" She said that at this point she was anxious to conceal the plans she was making from her then husband.
[9]
It will be seen that there was a very sharp conflict of evidence between the parties. Mr Bird who appeared on behalf of the applicant's parents submitted that I should give no credence at all to the evidence of Ms Henry where that evidence conflicted with the evidence of his clients. He pointed to the fact that she swore a number of affidavits in the family law proceedings with her first husband and filed statements of financial position which with a single exception were all consistent with the case made by her parents namely that the Caroline Springs property was held beneficially for the parents and that her entitlement was that of a trustee having no monetary value.
Under cross-examination on these matters Ms Henry said that those affidavits were lies. She said that she had been told what to put in the affidavits by her mother. During the interlocutory stage of this proceeding there were lengthy attempts by those acting for the parents to obtain the production of the affidavits from the Family Court. Because of privacy rules at the Family Court copies of these documents may not be obtained by a third party. On one occasion I made a specific order requiring Ms Henry to attend the Family Court registry to facilitate her parents' solicitor in obtaining copies of the affidavits. This proved unsuccessful. At that directions hearing Ms Henry displayed an attitude of total lack of cooperation. Ultimately the documents in question were only produced by a self executing order made by Senior Member Young at an abortive attempt on 23 October 2008 to bring this matter to a final hearing. As it was that self executing order had to be extended and even then Ms Henry failed to meet the deadline. At the outset of the hearing I ruled that a further extension of time should be granted so that the self executed determination of the proceeding against Ms Henry should be reversed.
The result of all this is Ms Henry comes before the Tribunal as a self confessed perjurer willing to sware falsely to get her way in legal proceedings. It is difficult to resist Mr Bird's submission as to her lack of credibility. Further there was a stark contrast between her assertions as to a multitude of cash payments for which no documentary evidence even of cash withdrawals from her various bank accounts has been presented, and the case made by the parents which is meticulously documented.
In these circumstances I prefer the evidence of Mr Protyniak that none of these alleged cash payments was made.
[10]
The parties have now agreed (though this was tenaciously opposed by Ms Henry until trial mainly by sheer delay and lack of cooperation) that this property should be sold. The only dispute is as to the manner in which the proceeds of sale should be disposed of.
In my view the Tribunal's usual practice in these matters should be followed such that the sale is placed under the control of the principal registrar and the estate agent whom the principal registrar appoints. This control is to be to the exclusion of the parties.
I start therefore with the presumption that Ms Henry should be treated as a full beneficial owner of the property. The Tribunal's power to order a sale of the property is to be found in section 228 of the Property Law Act. Section 233(1)(c) empowers the Tribunal in any proceeding under Division 2 of Part 4 which includes this proceeding to make an "adjustment" to a co-owners interest in land "to take account of amounts payable by co-owners during the period of the co-ownership". Subsection 2 of that section, paragraph (c) provides:
[11]
233(2) In determining whether to make an order under subsection (1), VCAT must take into account the following -
[12]
(c) the payment by a co-owner of more than that co-owner's proportionate share of rates (in the case of land), mortgage repayments, purchase money, instalments or other outgoings in respect of that land or goods for which all the co-owners are liable;
[13]
In a context such as this in determining whether there is a resulting trust the High Court in Calverley v Green[1984] HCA 81; (1984) 155 CLR 242 held that where monies were raised by mortgage to acquire a piece of real estate with both parties to a relationship being co-mortgagors they were regarded as both having contributed to the property despite the fact that the one mortgagor and not the other made the repayment. Whatever the jurisprudential underpinning for this view, it is at odds with the popular view that would be entertained by an ordinary member of the community. It is clear from the terms of section 233(2)(c) which I quote above that the relatively recently Part IV of the Property Law Act adopts the more popular view in the community that where a mortgage is taken out to raise the means to acquire a piece of real estate the person or persons who make the repayments under the mortgage are taken to be the ones who contributed to the purchase in the relevant proportions rather than merely looking to who was liable to make repayments under the mortgage as Calverley v Green would have us do.
I generally accept the analysis made by Mr Protyniak that as to mortgage repayments Ms Henry is to be regarded as having contributed $74,099.18 representing a gross $92,599.18 subject to the deduction of a private borrowing for her motor vehicle. Likewise I accept Mr Protyniak's calculation of the contribution which he and his wife have made to the acquisition of the property, meeting outgoings such as rates and insurance and making mortgage payments. In a supplementary written submission lodged following the close of the hearing Mr Bird on behalf of Mr and Mrs Protyniak said of the figure $74,099.18 that " This figure he said was a contribution of a 11% of a loan of $220,000.00. Hence, he concluded that Mr and Mrs Protyniak had contributed 89% relative to the loan.
[14]
I have indicated generally the form of order which I believe should be made namely, one which follows the Tribunal's relatively standard orders placing the sale in the hands of the principal registrar to the exclusion of the parties and leaving it to him to determine the identity of the agent to conduct the auction and the identity of the law firm to act for the vendors. The reserve price should be set by the agent appointed.
[15]
Mr Bird sought to make submissions as to costs but accepted a contention by Mr Archibald that they should be reserved pending the publication of my substantive determination. Accordingly costs will be reserved.
Parties
Applicant/Plaintiff:
Protyniak
Respondent/Defendant:
Henry
Cases Cited (1)
(1984) 155 CLR 242
AI Analysis
Outcomemixed
Disposition:
VCAT ordered the property be sold under the control of the principal registrar (to the exclusion of the parties); after assessing contributions, credibility and conduct, the Tribunal exercised its wide discretion under s 233 to determine that any mortgagors' equity should be disposed of according to the registered entitlements (one-third to each registered owner); costs reserved; parties to lodge short minutes within 14 days; directions hearing listed.
they said it was just the deposit they would be lending me, and that I would be required to pay the balance and all other expenses. I agreed to their offer. It enabled me to prepare to leave John.
According to Ms Henry her sister Nicki suggested that she view land at Caroline Springs. She found the property at Islington Place priced at $54,000 dollars. It was she said the only block left. She asked the agent to hold it until afternoon when her parents could view the property. She said her father asked her whether this vacant block which needed a house built was really what she wanted. She said that it was, and he wrote her a cheque for a holding deposit of $500 dollars. According to Ms Henry he would pay and she would pay him back "so that John would not become suspicious." Over the following months according to Ms Henry she repaid her father the $500 dollars in cash. Mr Protyniak denies this.
In November 1998 according to Ms Henry she inquired about a loan from the National Australia Bank Limited and was told that her income was insufficient to support a loan to acquire the land with the increase that would be necessary to buy the house. The bank officers suggested to her, she said, that her parents act as guarantors. If they took title to the property as co-owners they could be borrowers and "their income could be taken into account." She says she then had a conversation with her parents. Mrs Protyniak was not happy to be a guarantor "as they risked loosing (sic) their own house in the event of default on payment." According to Ms Henry her parents had a private discussion and her mother then informed her that Mr and Mrs Protyniak would be joined as borrowers and co-owners of the property.
Whatever the explanation as to how Title to the land was taken, both Ms Henry and her father were clear in their evidence that Mr and Mrs Protyniak would not be making any payments toward the land. These payments were all to be the responsibility of Ms Henry. Mr Protyniak said that meeting these payments was to be the "rent" which Ms Henry would pay to them. He said he did not account for any of the amounts paid by Ms Henry to the bank as rent for income tax purposes, nor it may be inferred did he claim as a deduction any amounts of interest which he and his wife might pay under the loan agreement. According to Ms Henry her father agreed to lend her the 10% deposit and purchase costs including stamp duty and that this loan would not be repayable "until after the mortgage had been repaid."
The statement for the loan account shows the loan drawn down in the sum of $43,000 dollars on 30 March 1999. According to Mr Protyniak the actual draw down was on 31 March 1999 to fund the payment of the balance of the purchase price for the land.
On 17 November 1999 the balance of the loan then outstanding was paid off by an amount of $43,000.00 which Mr Protyniak said was a gift to Mrs Protyniak from her late father Nykola Szuhan who had himself received this money as a bequest. $33,434.81 was applied to discharging the loan from the National Australia Bank, and the balance of $9,565.19 went to Ms Henry. According to Mr Protyniak this was a loan to enable her to pay off her car.
In July 2000 Paula split from her husband John and moved in with her parents.
According to Ms Henry on 17 November 1999 she was called to her parents house where she met her grandfather Mr Szuhan. Mr Protyniak was at work. Mrs Protyniak told Ms Henry that her grandfather had received a bequest of £18,000 from the estate of his late sister. Her mother she said had the cheque in hand. According to Ms Henry her mother told her that her grandfather had changed the plans which he had previously made for the money and had decided to give it to her so that she could pay off the block of land and build her dream home. According to Ms Henry her grandfather imposed two conditions on the gift. First, that John was never to set foot in the new house and secondly, that when the children went to stay with him she "was not to pack their bags for them, that instead to send them as they were." She said that neither her grandfather nor her mother told her that the money was a loan. According to Ms Henry she her mother and her grandfather went to the Commonwealth Bank in St Albans and the cheque was deposited to the credit of a joint account of which her mother was one of the account parties and a Commonwealth Bank cheque was drawn to enable the National Australia Bank loan to be paid off which was done at the branch immediately across the road.
The parties agree that in December 1999 Caleca Constructions was approached to build a house on the land. Again, the deposit of $600.00 was paid by Mr and Mrs Protyniak. A new loan was obtained on 3 March 2000 from the National Australia Bank. The cost of construction was $184,000.00. The work proved to be not entirely satisfactory and the matter came to this Tribunal in the Domestic Building List. The dispute was settled with the builder carrying out some additional work and the owners paying a settlement sum of $3,300.00. This amount was paid according to Mr Protyniak from a joint account held by his wife and his daughter Rebakah. Mr and Mrs Protyniak also paid the sum of a $165.00 to change the house lock. Mr and Mrs Protyniak paid $7,785.66 legal costs for the Tribunal proceeding together with $1,747.50 to a building consultant. Ms Henry paid no part of these monies.
Mr and Mrs Protyniak outlaid $3,020.00 for an alarm system. Their view is that this was an outlay made for the benefit of their property. Ms Henry says that the alarm system was given to her as a gift. Another builder was engaged to complete the work and Mr and Mrs Protyniak made a payment of $2,000.00 to him. However, they found his work unsatisfactory and the matter came once again to this Tribunal. The dispute was settled at VCAT by payment of $2,700.00 made by Mr and Mrs Protyniak.
According to Mr Protyniak by 7 May 2000 the loan from the National Bank stood at $169,376.91 "due to making additional payments on home loan."
Ms Henry had by then separated from her husband John and she was living with her parents. Unfortunately there was friction between her and her youngest sister Katrina. According to Mr Protyniak it was at that point that Ms Henry raised the possibility of her and her children moving into the property at Caroline Springs. According to Mr Protyniak "he had originally agreed for her and John to move in and we were concerned about her being able to make the mortgage repayments and the rates outgoings. She assured us that she would make the repayments and that it would be better than renting elsewhere." Mr and Mrs Protyniak say they agreed to Ms Henry moving into the property which she did on 26 January 2002. He said he and his wife spent money on plants and fertilizer. Ms Henry was responsible for the garden as she lived in the property. According to Mr Protyniak the "majority of the plants died because Paula did not take care of them." Mr Protyniak said that he and his wife paid for the boundary fence and gate pickets and so forth to the sum of $5,684.27 and tiles to the tune of $100.00 paid by credit card as well as blinds and back security door for $2,163.00.
According to Mr Protyniak one of his other daughters Rebekah borrowed $9,000.00 from her parents to buy a car. She made cash repayments initially but later made payments into the home loan account directly. According to Mr Protyniak, Rebekah paid $4,600.00 directly to the credit of the home loan account and repaid other amounts to her father who deposited them to the credit of that account.
Mr Protyniak says that Ms Henry moved into the Caroline Springs property on 26 January 2002 but did not make any payments of the loan account until 23 May 2002. Moreover, he says she drew some $10,000.00 out of the home loan account transferring it to her own bank account for her personal use without permission or authority of her parents.
In May 2002 Mr Protyniak says that Ms Henry approached him to assist her with finance for a new car. A new mortgage loan of $219,856.00 was arranged being $179,376.91 to pay out the home loan, $17,000.00 as a redraw facility but to reduce interest in the mean time and $23,477.00 to Ms Henry.
Mr Protyniak says that between 9 September 2002 and 3 April 2003 he and his wife paid $31,100.00 to the credit of the home loan.
It transpired that despite the understanding that Ms Henry would meet the mortgage payments and the rates such amounts were not being paid and magistrate court proceedings were commenced by the local shire against all three owners. Mr Protyniak says that from 31 May 1999 to 28 February 2001 he and his wife paid $1,430.50 council rates, $840.00 in council rates from 30 May 2001 to 31 May 2002, $788.00 was paid directly to a debt collector and $500.00 to Melton Shire Council. According to Mr Protyniak "from 5 December 2007 to 28 March 2008 I made payments of $50.00 instalments towards the arrears which were outstanding in the sum of $3,812.40. In total I paid the sum of $500.00 and ceased paying any further amounts." Mr Protyniak said "council is aware of these proceedings and has put the account on hold until the outcome of this case. He fully understands that $4,450.50 remains outstanding."
In June 2003 Ms Henry married her present husband Mr Paul Henry who moved into the property with his 15 year old son. In August 2004 their daughter was born. According to Mr Protyniak "during this time [Ms Henry] arranged with the bank to stop payment on the loan. We received some statements and noticed that [Ms Henry] was making unauthorised redraws from the NAB loan in 2002 to the sum of $7,000.00. She did pay the sum of $1,500.00 back into the home loan ..."
Again according to Mr Protyniak on 26 April 2004 Ms Henry redrew the sum of $45,600.00 from the NAB account and said she had not been paying the correct fortnightly instalments with the result that the debit balance increased to $208,070.81.
A proposed move for Ms Henry and her husband to Darwin proved abortive. The parents advanced the sum of $5,000.00 to law firm Carew Counsel in 2005 on account of costs in a family law proceeding with Ms Henry's first husband. Then it seems Ms Henry's car was repossessed and her parents lent her $3,500.00 to buy a second hand car to replace it. Mr Protyniak says this advance was never repaid to him. Mr Protyniak says that from 5 September 2007 the only payment made by Ms Henry was a one off payment of $7,390.00, and as at 9 October this year the balance on the account was $235,661.74. Mr Protyniak calculates that Ms Henry has paid $74,019.18. Mr and Mrs Protyniak made a number of payments on the loan but no more after 3 April 2003.
Demands by Mr and Mrs Protyniak that the property be sold were rejected by Ms Henry. On 15 May 2008 Kempsons Lawyers on the instructions of Mr and Mrs Protyniak filed the present proceeding seeking the sale of the property and the division of the net proceeds after costs of sale and clearance of the NAB mortgage to be divided equally between the three registered owners. Subsequently, pursuant to leave reserved by Senior Member Young the Protyniaks have amended their application so that they lay claim to the entire net proceeds.
The Protyniaks claim to have outlaid a total of $157,569.36 representing mortgage payments for building, insurance and so on.
Ms Henry for her part claims to have made a large number of cash payments to her father but she did not produce any documentary evidence of same. She said that initially these cash payments were made in small amounts so as her first husband would not be aware of what was happening. According to Ms Henry her father kept a book which accounted for these amounts. Mr Protyniak denies that any of these cash payments were made at all.
Accepting the Protyniaks' evidence as to the financial events I find myself unable to accept their evidence as to how the Caroline Springs property came to be acquired. The account on this score given by Ms Henry despite her gravely impaired credit is as plausible as the parents' account is implausible. It is entirely plausible that parents would seek to make provision for their eldest daughter involved in a rocky marriage and further that they should be concerned to see their grandchildren properly housed. It is in this universal human experience that lies at the basis of Equity's presumption of advancement between parent and child.
Why would someone seeking an investment property buy a vacant block? Why would Ms Henry who it is clear does not place a high value upon paying her legal debts agree to shoulder the entire burden of paying off the principal and interest on the mortgage loan to obtain no beneficial interest in the subject property at all? If Ms Henry was no more than a tenant or a trustee why did the parents file an application which initially sought to allocate one third as the mortgagor's equity in the property to her?
Again, the thought that her grandfather and her mother might join to make her a gift of the proceeds of the deceased estate bequest to assist with the building of a house on which she was to have a beneficial interest is plausible. If she was to have no beneficial interest in that house it is implausible to think that the grandfather and mother would offer this money as a loan (as Mr Protyniak claims) or that Ms Henry would admit the liability of a borrower.
if one third is considered as her [that is Ms Henry's] contribution to the mortgage the figure is approximately $24,699.00."
I reject that submission. The sad fact is that a large percentage of the loan made by the bank remains unrepaid by any of the parties to this proceeding. When the property is sold the bank will recoup itself for this unrepaid principal plus interest and costs before any of the parties to this proceeding receives a dollar of distribution; hence, the calculations for present purposes must be made by reference to what has been repaid not what has not been repaid. Moreover, the submission gives no explanation as to why Ms Henry's actual contribution should be discounted in this way. In his supplementary submissions Mr Archibald, counsel for Ms Henry, contended that no such discount should be made. I accept this contention. In a supplementary affidavit Ms Henry claimed to have made a further $13,955.00 representing contributions which she says she has made to the upkeep and improvement of the property over the years including items such as materials for construction of pergola $5,000.00, lace curtains $17.30 and so on. She also claims $5,000.00 for backyard and landscaping gardens including plants, trees, lawn, topsoil, gypsum etc. No documentary evidence was provided for any of these items and as to some of the items, admittedly some of the smaller variety, she said that her husband had met the relevant outlay. Given Ms Henry's impaired credit and the lack of documentation I believe I should allow these contributions as having been made at the rate of approximately 50% of the amount claimed. Say $7,000.00.
Insofar as the Protyniaks are seeking the entire mortgagors' equity in the property, I believe I should regard them as having made a claim for occupation rent. By virtue of section 233(3) I have no power to make such an order save in three circumstances; two of them are irrelevant namely the co-owners claiming the rent being excluded from occupation or that the parents have suffered a detriment "because it was not practicable for that co-owner to occupy the land with the other co-owner." There was no evidence that the parents ever wanted to occupy this property, therefore they were not excluded and there was no problem of practicability which inflicted a detriment upon them. They were subject to detriment because Ms Henry did not live up to her promises to keep down the mortgage and pay the outgoings but they suffered no detriment because it was not practicable for them to occupy the land. This leaves only one circumstance in which an occupancy rent can be levied namely for the occupying co-owner "is seeking compensation, reimbursement or accounting for money expended by the co-owner who has occupied the land in relation to the land." The claims by Ms Henry which I referred most recently are of that character. Hence, I do have the power to award an occupancy rent against Ms Henry.
Given the view that I have formed as to the purpose for the acquisition of this property namely to provide a home for Ms Henry and her children and in the classic sense to "advance her" - to set her up in life I do not believe it is equitable now retrospectively to charge her with an occupancy rent.
I believe however that it may be appropriate to consider that there be some adjustment to the property entitlements of the owners such that the mortgagors' equity should be divided as to three quarters in favour of the applicants and as to one quarter in favour of Ms Henry. According to the applicants' calculations which I have generally accepted and allowing the various miscellaneous contributions sought by Ms Henry to the extent of $7,000.00 the parents have outlaid close to twice as much as Ms Henry on this property. On the other hand whilst not in a formal sense providing for an occupancy rent I think the fact that this property has been used solely for Ms Henry's benefit should bear some weight. Section 233(1) of the Property Law Act creates an open discretion allowing adjustment to be made in a co-owners' interest. It does not lay down what criteria may be resorted to. Subsection (2) requires that certain matters must be considered but does not lay those down as the exhaustive list of the matters which may be considered in making an order under section 233(1).Section 228(1) empowers the Tribunal to "make any order it thinks fit to ensure that a just and fair sale or division of land... occurs." In those circumstances I believe I have a wide discretion. In exercise of that wide discretion I also take account of the fact that until almost the eve of hearing Ms Henry by delay, omission and obstruction was opposed to the making of an order for sale of the subject property. This despite the fact that she was entirely failing to observe the promise she had made to her parents to meet the mortgage payments and outgoings on the property and that she well knew that nobody was paying the bank. What seems to have led to her change of heart was the fact that the bank was seeking to take possession and would take the matter out of the hands of her family altogether.
Against these matters must be weighed a transaction which took place in September 2004. Mr Protyniak noted that Ms Henry withdrew $45,600.00 representing a credit available for redraw in the home loan. This resulted in an increase in the debit balance from $162,772.98 to $207,827.98. This credit balance had according to Mr Protyniak being built up by supplementary payments from him and his wife "in order to reduce the mortgage [loan] and the interest". The Protyniak's said they were concerned that Mr Henry was "making unauthorised withdrawals" hence, they asked her to withdraw this credit balance. According to Ms Henry this credit balance was remitted to her parents after having initially stood to the credit of her own account. I did not understand Mr and Mrs Protyniak to deny that these transactions took place. Hence, the claim on their part to have contributed $157,569.36 makes no allowance for these transactions and accordingly overstates their contribution. Once this is allowed for as Mr Archibald in his supplementary submission observed this would have Ms Henry's contribution to the outlays actually made by the parties totalling $186,068.00 at 40%. Mr Archibald contended however, that the parties' contributions in the total of the amounts paid and withdrawn [emphasis in the original] set out in the document handed to the Tribunal during final submissions (in the column headed "Paula's contention") should be counted. This would have Ms Henry contributing 75% of the outlays of $145,709.00 and the applicants contributing $79,415.00.
I am not entirely clear on the methodology used by Mr Archibald in the calculations most recently referred to. Holding to the view that I have previously expressed that what should be allowed for is the contribution actually made by the relevant parties rather than some other basis I must necessarily reject these final calculations made by Mr Archibald. But the result on any view is that Ms Henry made a greater contribution than the one third interest reflected in the registered title. Nevertheless I am not persuaded that this should lead to her being allocated any greater sum than a one third interest based upon the various considerations weighing against her referred to above which ultimately boiled down to her having conducted herself badly as regards her parents despite the very large assistance which they gave her and to her having had the exclusive enjoyment of the occupancy of the premises. In all those circumstances the just outcome in my view is that the allocation of any mortgagors' equity which may be found to exist following sale of the property and clearing of the mortgage debt and the costs of sale should follow the entitlements as registered on title namely, one third, one third, one third.