Saitannis v Katsolos

1. The parties agreed that the value of the Macquarie Fields property as of 1 November 2021 was $825,000. The plaintiffs' evidence was that the initial asking price for the Macquarie Fields property was about $400,000, but because of the difficulty that they had finding a buyer the property was ultimately sold for $350,000 in September 2010.
2. The parties also agreed that the value of the Georges Hall property as of 1 June 2009 was $500,000. By around November or December 2021 the value of that property was $1,600,000. If the property had not been renovated by the plaintiffs, it would have had a value at that time of $1,500,000. Consequently, the effect of the renovations carried out by the plaintiffs has increased the value of the property by $100,000.
3. A rental report was tendered by agreement between the parties so that, if the Court finds that Irene is entitled to an order that the plaintiffs pay her mesne profits from 2 May 2021, the appropriate rent to be used for the calculation of the amount payable will be agreed.

Overview of the dispute

1. The key to the proper determination of this dispute is the realisation that both sides of the record have propounded a version of the arrangement that they entered into that is at the extreme of the range of available interpretations of events and is most suitable to their interests. In taking that course, they have ignored significant aspects of the evidence and the logical probabilities that flow from that evidence.
2. As I have recorded above, the plaintiffs' version of the arrangement was that Irene represented to them that they would become immediate absolute beneficial owners of the Georges Hall property upon payment to Anastasia of $100,000, and that the reason they had to wait to obtain legal title to the property by way of a gift under Irene's will was that Irene suggested that this arrangement would save stamp duty that would otherwise be payable on an immediate transfer.
3. Irene, on the other hand, claimed that the arrangement was limited to possession being given to the plaintiffs for an indefinite period to enable them to live and raise their children in more comfort and closer to their relatives than they could enjoy living in their Macquarie Fields home, and so that, as a result of not being required to pay a mortgage or rent, they could save money to buy their own home. The period during which the plaintiffs could enjoy possession of the Georges Hall property was entirely indefinite, but appeared to be linked to the plaintiffs' young children being cared for and growing older and the plaintiffs' finances improving to the stage where they could afford to buy a suitable new home in reasonable financial comfort.
4. I make the preliminary observation that the plaintiffs pleaded, and their evidentiary case was, that the arrangement with Irene was made during two separate conversations, much as might have happened had the arrangement been an arm's-length agreement between strangers. I find that to be an improbable scenario, given Helen's acceptance of Irene's evidence that Helen and Irene had a close relationship as mother and daughter. Irene gave credible evidence that, after the death of Nicholas, she travelled to Helen's home frequently to help her care for her children, particularly during Helen's pregnancies. It is much more likely that whatever the terms of the arrangement were, they were discussed between Helen and Irene on numerous occasions. Irene's evidence of conversations with Helen on the subject of whether Helen and Louis should sell the Macquarie Fields home was (T 186.28-186.39): A. INTERPRETER: There were too many conversations with Helen. Okay. So look, there were too many conversations with Helen. Helen was saying one thing one day, one thing the other, "What do you think, mum? Should I do this? Should I sell this?" We were - we were close - and sometimes I would tell her my opinion. I would not force her to do it. Q. How many conversations were there in which the idea of Helen living at the Georges Hall property were discussed? A. INTERPRETER: So I cannot give you an answer to this question how many times I've talked about it. We've been talking on the phone, it could be 100 times, it could be once. At this age I - I'm not going to be able to remember this because I don't think that's important.
5. Realistically, it is probable that the arrangement was discussed many times and evolved over time. As I said in a similar case, Spink v Flourentzou [2019] NSWSC 256 (affirmed on appeal in Flourentzou v Spink [2019] NSWCA 315): [178] … That is, that the parties discussed the proposal numerous times over a considerable period. The evidence does not extend to the substance of what was said in all of the conversations. That may be understandable, given the difficulty and expense involved in attempting to relate all of the conversations. However, the effect is that the evidence given is each party's distillation of the substance of a great many conversations spread over a period of months. Almost inevitably, evidence given in this manner will reflect the particular witness' view or appreciation of the effect of the conversations. That understanding will be reached through the prism of the witness' self-interest and reflection upon what the witness believes was said, or must have been said, after a significant period of reflection on the consequences of the events that subsequently occurred. Unsurprisingly, the evidence given in response by Dianne and Mario took a similar structural form. … [180] The most well-known extract from the authorities relevant to the proof of statements and arrangements made orally is probably the following, taken from the judgment of McLelland CJ in Eq in Watson v Foxman (1995) 49 NSWLR 315 at 318-319 (in the context of whether alleged statements were misleading and deceptive): ...Furthermore, human memory of what was said in a conversation is fallible for a variety of reasons, and ordinarily the degree of fallibility increases with the passage of time, particularly where disputes or litigation intervene, and the processes of memory are overlaid, often subconsciously, by perceptions or self-interest as well as conscious consideration of what should have been said or could have been said. All too often what is actually remembered is little more than an impression from which plausible details are then, again often subconsciously, constructed. All this is a matter of ordinary human experience. Each element of the cause of action must be proved to the reasonable satisfaction of the court, which means that the court "must feel an actual persuasion of its occurrence or existence". Such satisfaction is "not … attained or established independently of the nature and consequence of the fact or facts to be proved" including the "seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding": Helton v Allen (1940) 63 CLR 691 at 712. [181] The problem that McLelland CJ in Eq so perceptively explained is amplified where the reality is that the same subject was discussed frequently by the members of a family, at a time of family unity, in different locations where, as the evidence shows was true in the present case, the parties were initially reluctant to make the arrangement, but persuaded themselves over time that it was safe and prudent for them to do so. It is almost certain that the proposal was put in different ways by the different parties using different words over the period, and that the proposal may have evolved in its substance and in the way that it was described by the participants. The participants were not contemplating making a clear, formal agreement that would be enforceable at law. It is likely that the participants used expressions intending those words to have a particular meaning and assuming that the others participating understood the intended meaning. [182] In these circumstances, the Court is presented with limited and distilled evidence from the perspective of the individual witnesses which is said to have given rise to an arrangement, whether that alleged in the paragraphs of the statement of claim, or that which is implied in the defence.
6. In these circumstances, the following considerations, as stated by Hallen J in Evans v Braddock [2015] NSWSC 249, and accepted by Sackar J in Campbell v Campbell [2015] NSWSC 784 at [76], and by me in Meshumar v Otmy (2018) 97 NSWLR 615 at 623-5; [2018] NSWSC 125 at [41] and Perry v Perry [2021] NSWSC 1669 at [154] apply: [74] A court, in cases involving events which occurred long before the litigation, usually prefers to rely upon contemporaneous, or near contemporaneous, documents, which will often provide valuable and, usually, more revealing, information than what may be flawed attempts at recollection of those facts by persons with an interest in the outcome of the litigation: Bathurst Regional Council v Local Government Financial Services Pty Ltd (No 5) [2012] FCA 1200, per Jagot J, at [1247]. Greater weight is usually accorded to such documents, as often they provide a safer repository of reliable fact, particularly when it is clear that they have been prepared by a person with no reason to misstate those facts in the documents and where there is no suggestion that the documents are other than genuine: Hughes v St Barbara Mines Ltd [No 4] [2010] WASC 160, per Kenneth Martin J, at [157]. … [76] The circumstances of this case, make what was written by Tamberlin J in Lake Cumbeline Pty Ltd v Effem Foods Pty Ltd (trading as Uncle Ben's of Australia) (Federal Court of Australia, Tamberlin J, 29 June 1995, unrep), at 122 - 123 (in a passage cited with approval by the High Court when it upheld his Honour's decision: Effem Foods Pty Ltd v Lake Cumbeline Pty Ltd [1999] HCA 15; (1999) 161 ALR 599, at [15]) appropriate to remember: "[Given the lapse of time] between the events and conversations raised in evidence and the hearing of the evidence before me, the only safe course is to place primary emphasis on the objective factual surrounding material and the inherent commercial probabilities, together with the documentation tendered in evidence. In circumstances where the events took place so long ago, it must be an exceptional witness whose undocumented testimony can be unreservedly relied on. The witnesses in this case unfortunately did not come within that exceptional class. The discussions referred to in evidence were capable of bearing quite opposed meanings depending on subtle differences of nuance and emphasis, and a proper appreciation of the significance of those matters must necessarily be considerably diminished over such a long period of time." …
7. In cases such as the present, the Court is much more likely to be assisted by an analysis of the objective evidence of what was done in carrying out a family arrangement and what the probabilities suggest the true arrangement between the parties was, than it is to try to decide who is the winner on the balance of probabilities in a contest to convince the Court that relevant conversations had one specific content rather than the content propounded by the opposing party.

Irene's case

1. It will be convenient to consider first the probability that the arrangement between Irene and the plaintiffs was in the terms propounded by Irene. I consider it to be most improbable that the arrangement was limited to the narrow terms claimed by Irene.
2. I should first state my findings concerning the credibility of the evidence given by Irene. At the time she gave evidence, Irene was 78 years of age and described herself as an old, tired woman. Irene is a native Greek speaker and gave her evidence through an interpreter who was, I should record, an extraordinarily competent one. Irene has been living in Australia, however, for many years, and has a limited capacity to speak and understand English. Consequently, Irene could understand parts of the questions that were asked of her in cross-examination, and she frequently could not resist giving answers in English in competition with the interpreter. It appeared to me that in taking this course, Irene frequently did not understand the nuances of the questions that she was being asked, and her precipitate responses in English denied her the benefit of careful translation by the interpreter.
3. Irene was understandably highly emotional during her cross-examination, and she was clearly under nervous strain. I am satisfied that Irene was a generally honest witness, at least in the sense of giving her evidence in accordance with her real perceptions and recollections. However, it became clear that those perceptions and recollections were not always reliable. Furthermore, Irene was not, with respect, intellectually sophisticated and on a number of occasions she gave explanations or responses that were quite illogical. In the circumstances, I have not thought it necessary to reject Irene's evidence generally, but it has been necessary to treat it with considerable caution.
4. Many aspects of Irene's evidence rang true, particularly when she was recounting the more prosaic aspects of her dealings with the plaintiffs. I have set out above part of the defence pleaded by Irene to par 8 of the plaintiffs' statement of claim. I repeat that Irene pleaded that she "finds it an insult and completely unjust to give a property away to one daughter and her husband" which would create "a great injustice" to Anastasia and Georgina. It is highly likely that Irene has responded in her own mind to the claims now made by the plaintiffs in a way that has coloured her recollection of events in a way that is supportive of her present case.
5. Anastasia appeared to give her evidence in a satisfactory way, although the circumstance that her evidence was given by audio-visual means limited the Court's capacity to assess the credibility of her evidence by reference to her demeanour. The plaintiffs made complex submissions as to why the Court should not accept Anastasia as a witness of truth, by reason of various objective matters that were said to be inconsistent with the evidence that she gave. I do not think it is necessary to attempt to rule on all the plaintiffs' submissions, as the evidence was not sufficiently distinct to make it safe for the Court to determine Anastasia's credibility as a witness on that basis. It is sufficient, however, for me to say that, as will be seen, I have not accepted the principal aspect of Anastasia's evidence, being that $100,000 paid to her by Helen was paid as a loan that Helen insisted upon making and Anastasia resisted.
6. There are four principal reasons why I am unable to accept that the arrangement between the parties was on the terms propounded by Irene. The first is the objective fact that, having made a will on 4 December 2006 in which she left her estate to her three daughters in equal shares, on 23 January 2012 Irene made a will leaving the whole of her interest in the Georges Hall property to Helen. Given that the evidence clearly justifies a finding that Irene loved and cared for her three daughters equally, there must have been a special reason why Irene decided to leave the Georges Hall property solely to Helen. The only reason for such an extreme step that is available on the evidence is that the arrangement between the parties at least required that Irene take that step.
7. Irene offered an improbable explanation for why she decided to leave the Georges Hall property solely to Helen: see par 206 of her primary affidavit and (T 129.24-131.9). That explanation was that her other two daughters' marriages had failed and they were divorced, which was a matter of considerable shame to Irene in the Greek community in which she lived. Irene believed from her interactions with the plaintiffs that there was a real risk that Louis would separate from and divorce Helen, which would have exacerbated Irene's shame. Irene said that she decided to leave the Georges Hall property to Helen as the belief on Louis's part that Helen would inherit a valuable property would reduce the risk that Irene would suffer the ignominy of having three divorced daughters. However, Irene insisted in cross-examination that she did not tell either Helen or Louis about the terms of her will, and she went so far as to say that it was normal for beneficiaries to learn of the terms of a will only when it was read after the death of the testator. Clearly, this explanation is completely illogical for the obvious reason that the terms of the will could not have reduced the risk that Louis would separate from Helen if neither Helen nor Louis knew of those terms.
8. The second reason is the explanation given by Irene and Anastasia between them of the basis upon which Helen paid $100,000 into Anastasia's home loan account on 20 October 2010. Irene's evidence was that there was no discussion at all between her and the plaintiffs about the payment of $100,000 during the conversations that led to the arrangement between Irene and the plaintiffs. In her affidavit at pars 26-36, Anastasia claimed that Helen volunteered to lend the money to Anastasia, as Helen and Louis were moving into the Georges Hall property rent free. Anastasia claimed that she told Helen: "I am okay for money and I am managing my mortgage on my own." Helen responded: "I insist you take the money. It is not a gift; it is a loan and it's my money I saved for the deposit on the Macquarie Fields house." Anastasia claimed that she told Helen that when Helen was ready to buy her own home, Anastasia would reciprocate and give the $100,000 back.
9. While this point is not as clear a reason for rejecting Irene's version of the arrangement as the previous one was, I consider that it is improbable that the $100,000 was paid for the reason claimed by Anastasia. It is also improbable that Helen did not discuss the payment of the $100,000 with Irene. The sale of the Macquarie Fields property took place on 14 October 2010 and the sale proceeds deposited into Helen's bank account were $108,213.85. The $100,000 was paid into Anastasia's home loan account six days later. It is likely that the transactions were related, as Helen and Louis moved into the Georges Hall property on 14 October 2010. It is also, in my view, highly improbable that Helen insisted that Anastasia accept a loan of $100,000, leaving Helen with $8,213.85, if the circumstances were that Anastasia said she did not need the money and it is likely that Helen and Louis would have benefited from retaining a contingency fund of over $100,000.
10. The third reason why I am not prepared to accept Irene's version of the arrangement is that, according to her, a primary purpose of the arrangement was to enable Helen and Louis to save enough money to be able to buy their own home. However, Helen and Louis already had their own home at Macquarie Fields, which had, as it turned out, a market value of $350,000 and an equity of $108,213.85. Helen's evidence was that she was ahead in her mortgage repayments, and that because of renovations undertaken by Helen and Louis, the Macquarie Fields home was suitable for their purposes. This was an issue contested by Irene, who claimed that Helen had frequently complained about the inadequacy of the Macquarie Fields home for her expanding family, and that it was not in a salubrious location, given in particular that she was left at home at night because Louis worked night shifts.
11. The objective evidence is not sufficient to enable the Court to decide with confidence what the true position was concerning the suitability of the Macquarie Fields home. The detail of the evidence is also not sufficient to persuade me that Helen and Louis would have considered the better course was for them to give up the existing home that they owned, pay almost all of the equity they had to Anastasia, and then move into the Georges Hall property with their children on the basis that that only gave them an indefinite right of possession.
12. The fourth reason why I am not prepared to accept Irene's version of the arrangement arises out of the evidence given by Helen and Louis of the nature and extent of the renovations that they undertook on the Georges Hall property. Although the expert valuation evidence was that the renovations only added $100,000 to the value of the property as at the date of the hearing, it may be that the renovations cost more than that amount and that the cost does not include a considerable amount of labour undertaken by Louis. It is probably not possible on the evidence to determine an accurate cost of the renovation works, but I am satisfied that they are of a nature that is consistent with the expectation of the plaintiffs that they would at least be entitled to enjoy possession of the property with their family for a substantial, if not indefinite period. The renovations are consistent with the plaintiffs doing their best to make the Georges Hall property their family home.
13. In her evidence, Irene consistently attempted to downgrade the significance and extent of the renovations, to claim that the renovations were unnecessary and carried out without her approval, and to assert that the major part of the renovations was undertaken behind her back and without her knowledge. I am satisfied from the evidence given by Helen and Louis, and the other members of their family who gave evidence, that Irene was aware of and approved at least a major part of the renovations. I do not think it is necessary to set this evidence out in detail. The evidence was episodic, which is understandable, because members of the family would only be present in the one place for special occasions. I am satisfied that Irene understood the significance of the renovations having been carried out to the plaintiffs' case, and this has caused her to understate her knowledge and approval of those renovations.

Helen and Louis' case

1. I now turn to consider the plaintiffs' case as to the terms of their arrangement with Irene. I should first say that I found the plaintiffs to be generally satisfactory witnesses, particularly in relation to their evidence concerning the objective historical facts. The position is not so clear in relation to their evidence of the representations that they say constituted their arrangement with Irene. I have no reason to find that the plaintiffs did not attempt to give honest evidence of their recollections of the conversations. However, I have already said that I am not prepared to accept that there were only two relevant conversations, at least as between Helen and Irene. It may well be that Louis was only present at a limited number of conversations at the end of the process of discussing the arrangement. The essential reason why I am sceptical about the accuracy of the plaintiffs' summation of the conversations is the one that I have given above about the inherent uncertainty of recollection by interested parties in this context.
2. I should add for completeness that there was no apparent reason for the Court not to accept the substance of the limited evidence given by the plaintiffs' other witnesses. That evidence primarily concerned Irene's knowledge and approval of the renovations of the Georges Hall property. I have explained above why I do not think it is necessary to examine that evidence in any detail.
3. The plaintiffs' case as to the real terms of their arrangement with Irene also did not survive the hearing. When parties to family arrangements give evidence that the arrangements were made in a small number of precise conversations, it is, as I have observed above, probable that the evidence represents the parties' distillation of numerous conversations within the family concerning an important change to the family's affairs. When the evidence of the conversations is given succinctly with all commas and full stops in the right places, it is probable that the evidence represents the 'best' recollection that the parties can express in evidence - sometimes improved by careful professional assistance.
4. As evidence in this form is likely to represent the best case the party giving the evidence can muster, it may be fair to hold the party to that evidence.
5. Helen gave the following evidence concerning the making of what she called the representations in her primary affidavit: 21 In about mid-2009, I received a telephone call from Mum, and we had a conversation to the following effect: Mum: I have something important to talk to you and Louis about, but I prefer to come and see you both in person. Me: You can come over today and talk to us if you like. 22 Later that day, Mum visited Louis and I at the Macquarie Fields Property. After Mum arrived, the three of us sat down together and had a conversation to the following effect: Me: Mum, what is it you wanted to talk to us about? Mum: I want to make an offer to you both. Me: What is it? Mum: I've given Anastasia and Georgina lots of help over the years. I've helped them pay for their weddings, for renovations, holidays and bills. (sic) and also looking after their kids. Helen, you are the only one that I haven't helped and you have always been there for me with anything that I needed, so now I'd like to help your family. If you pay Anastasia $100,000 and (sic) I will give you both the house. Me: Wow, I don't know what to say. I think Louis and I will need to think about it. We've spent some (sic) much time and money renovating our house, so it's a big decision. Mum: That's fine, I have already spoken to your sisters and they are both happy with it. … 25 Louis and I decided to accept Mum's offer. The next day, I called Mum and had a conversation with her to the following effect: Me: Hi Mum, can you come over today so we can talk? Mum: Yes, of course, I will come soon. 26 Later that day, Mum came over to the Macquarie Fields Property and had lunch with Louis and me. During lunch we had a conversation to the following effect: Me: Mum, Louis and I have decided to accept your offer. We are honoured to. Mum: Congratulations, you've made me very happy. This is what I wanted, for us to be closer. Me: What's going to happen with transferring the house? Mum: Instead of transferring the house I will leave it to both of you in my Will. That way you won't have to pay stamp duty. You can spend that money on renovations instead. Me: Okay, we need to sell our house to pay the $100,000.00 to Anastasia. Me: Okay, I understand. Louis: I need to have a look around the house to see what work needs to be done. Mum: I will give you the keys. 27 When Mum told Louis and I that she would leave the Georges Hall Property to us in her Will rather than transfer it into our names, I believed that Mum was just trying to avoid incurring fees such as stamp duty. My understanding was that even though the Georges Hall Property would be in Mum's name, the real owners would be Louis and myself. I assumed that Louis and I would be the ones entitled to be on the title to the Georges Hall Property once we paid $100,000 to Anastasia. I also assumed that Mum was going to change her Will, so that the Georges Hall Property transferred into her [error for our] names when she died.
6. The evidence given by Louis in his primary affidavit was to the same effect, although understandably not in identical terms. I will only set out the most relevant parts of Louis's evidence of the conversations with Irene. The first conversation, set out in par 18 of Louis's affidavit, included: … Irene: I'd like to say, I have helped both Anastasia and Georgina a great deal over the years with their weddings, holidays, renovations and bills. Helen you have been the only one to help me with bills and anything that I needed. You have always been there for me. Helen: Of course, Mum. Irene: The only daughter I hadn't really helped is you Helen. So, my offer to you both is that if you can pay $100,000.00 to Anastasia, which she has agreed to, then the house will be for you both. You have my word on that. Anastasia won't have a claim over the house, you have my word on that. Louis: What about Georgina mum? Irene: Look, just like Anastasia, I have helped Georgina over the years as well, with her wedding, holidays and all that, it was paid for by me. Look, Georgina will get whatever savings I have in the bank, that would be her share. Georgina will be taken care of by my savings in the bank. That is why if you can pay to Anastasia $100,000.00, then the house will be for the both of you. After all, I need to help you both out now, while I still can and while I am still alive not when I pass away. I want to be able to provide something now. Look, if you accept my offer, I will make sure the house will be for the both of you. …
7. In relation to the second conversation, Louis's evidence in par 26 was in the following terms concerning the proposal that Irene would leave the Georges Hall property to the plaintiffs in her will: … Irene: Look, I'm not going to transfer anything now. I will take care of it in my will. I will make sure the house goes to the both of you. Louis: Makes sense to do it in a will, that way we won't have to spend money on stamp duty and can spend it on renovations. We now have to sell our house to come up with the money to pay Anastasia, as we don't have $100,000.00 lying around in the bank. …
8. Perhaps the most significant feature of the evidence given by the plaintiffs concerning what Irene said she would do is that Irene did not say words that conveyed the meaning that the ownership of the Georges Hall property would be transferred immediately to the plaintiffs. In his evidence of the first conversation, Louis said that Irene said on three occasions, words to the effect of "then the house will be for the both of you", which is apt to describe an event that will occur in the future. In the second conversation, Louis said that Irene said: "I will make sure the house goes to the both of you." Helen's evidence of the conversation is more equivocal in that she said that Irene said on the first occasion: "and I will give you both the house". However, on the second occasion, according to Helen, Irene said: "Instead of transferring the house I will leave it to both of you in my Will."
9. These observations are not conclusive as to the true effect of the plaintiffs' evidence concerning the statements they claim were made by Irene, but on balance they support a conclusion that what Irene was really offering was to leave the Georges Hall property to the plaintiffs in her will. That is not a satisfactory explanation of the whole of the arrangement, because the evidence makes clear that Irene gave the plaintiffs possession of the Georges Hall property from the time that they paid the $100,000 to Anastasia.
10. The following observations may be made about the plaintiffs' evidence of these conversations. First, the suggestion is that Irene volunteered to give the plaintiffs the Georges Hall property in return only for a payment of $100,000 to Anastasia. As the agreed valuation evidence is that the property was worth $500,000 at the time, if this promise was made, it involved Irene making a gift of $400,000 to the plaintiffs.
11. The plaintiffs' evidence was that Irene volunteered this gift because she had already made gifts to Anastasia and Georgina, and her purpose was to even up her treatment of her three daughters. There was no evidence that Irene had made gifts to Anastasia and Georgina of an aggregate value anywhere near $400,000. The evidence did not make the position clear, although it appears that Irene permitted Georgina and her son to live in the granny flat at the Georges Hall property from between about 1999 and 2010. It is inherently unlikely that Anastasia and Georgina would have agreed to Irene disinheriting them by bequeathing her only substantial asset solely to the plaintiffs.
12. Having received evidence from Irene concerning her personal history, and having had the benefit of observing her during a lengthy cross-examination, I find that it is extremely doubtful that Irene would have suggested that she transfer the Georges Hall property to the plaintiffs by will in order to avoid the payment of stamp duty. I note that while it was Helen's evidence that Irene raised the issue of avoiding stamp duty, Louis's version of the second conversation was that he was the one who suggested that it would make sense to transfer the property by will as it would avoid the payment of stamp duty.
13. The effect of the plaintiffs' case - that Irene represented to them that they would be the immediate, sole owners of the Georges Hall property - would, if true, be that a 64-year-old woman, who had lost her husband three years earlier, and who was pensioner, had voluntarily transferred the beneficial ownership of her only substantial asset in a way that made her homeless, and dependent upon the good will of Anastasia and Helen, as Georgina did not have the capacity to look after her mother.
14. According to Irene's affidavit evidence, which was not contradicted, she came from a farming family in Greece, and in her youth worked very hard tilling the soil, picking grapes and digging. She left her village at the age of 18 to study English. She came to Australia on a ticket paid for by the Commonwealth government "with only a dress, a pair of shoes and my mum and dad's wise words." She studied hospitality in Greece and learnt enough English to survive before she came to Australia. She arrived in 1963. Irene gave evidence of an onerous migrant working existence in this country. Irene spent much of her working life working in cafés and restaurants.
15. Irene and Nicholas purchased a property at East Hills. Irene's evidence was that they had a first mortgage charging 18% interest and a second mortgage at 22% interest. Irene said in par 51 of her affidavit of 28 May 2021: 51. I didn't understand about mortgages as neither Nick nor I had been educated in that area. I used to cry, when I counted the money on the floor and Nick would give me support and encouragement and would say to me, "Don't worry, one day we will pay off our house and go on a holiday to Greece together," but it never happened.
16. Irene and her husband sold the East Hills property in about 1978, which was the year in which the Georges Hall property was acquired for a price of $60,500. Irene gave evidence of the work done by Irene and Nicholas in renovating the property.
17. Irene had a hip replacement on 26 November 2009 and was discharged from hospital six days later. She needed someone to assist her to do her day-to-day duties, so Anastasia offered to let Irene move into her home so she could provide Irene with full-time care.
18. At the time of the conversations alleged by the plaintiffs, Irene was an ailing sixty-five-year-old widow who was still grieving her husband, who spoke only limited English, was unsophisticated in her commercial dealings, and, by reason of her ailments, she was dependent for care on one of her daughters.
19. This case does not directly raise the issue of whether it would have involved unconscionable conduct on the plaintiffs' part if they had made an arrangement with Irene that they would receive immediate, absolute beneficial ownership and possession of the Georges Hall property for a payment of $100,000 to Anastasia and no payment to Irene. However, these considerations would be relevant to the determination of the relief that would be equitable for the Court to give to the plaintiffs against Irene, if the plaintiffs established that the arrangement was in the terms for which they contended.
20. The proposition that the plaintiffs' version of the arrangement was that Irene had immediately divested herself of her only home and substantial asset for no reward, in circumstances that made her dependent for a roof over her head on the good will of her daughters, was so obviously problematic that counsel for Irene was moved to cross-examine Helen to suggest that those aspects of the alleged arrangement were so extreme as to require a rejection of the plaintiffs' claims. It will be appropriate to set out relevant parts of the cross-examination at length, as they contain a significant revelation for the purposes of the resolution of this dispute.
21. First, at (T 21.9-21.20): Q. What did you understand to be the reason that your mother moved out of Georges Hall in the middle of 2009? A. Well, it wasn't - it was just temporary; it wasn't permanent because my husband had to restructure the whole house, so being asthmatic; there was carpet there. He needed to remove lots of doors and sort out all the cracks cause the structure of the house was not in good condition. It was an old house, it had a basement, it was like a cellar, it was situated with - with clay, so there - the foundation of the house was not very safe. So he had to basically remove things in the house. There was lots of doors, windows. Like I said, he had to do a whole inside, change all - get the electrician to change all the electrical, and just do it all nice and modern and fresh because it was a very aged, dated house.
22. Secondly, at (T 21.32-21.43): Q. I asked you what was your understanding as to why your mother moved out in the middle of 2009 to live with your sister. What did you understand was the reason for that? A. Well, I couldn't have my mother with her asthma and her in the surrounding of the house with it all dust, and everything needed to be removed, everything needed to be repaired. So it wasn't a very safe environment. Q. See-- A. So my husband said, you know, like - my mum - I - I'm not sure what really what - what was said, but I'm pretty sure my mum said she'll have to vacate at my sister's for that temporary time. Clearly she couldn't be upstairs with all the construction and all that going on, all the renovation going on.
23. Thirdly, at (T 30.50-32.9): Q. No, what I put to you is your mother got nothing out of it - it was your sister that got the $100,000. That's the proposition you are putting as your case, isn't it? A. No. Q. I think you're misunderstanding, Mrs Saitannis. A. Do you want me to elaborate? Q. Well, no, just coming back - you say that your mother made a promise. First of all, that's right? Is that what you're saying? In mid-- A. What was the last point? Q. --in mid-2009, your mother, you say, came to your place and made you a promise. A. An offer, yes. Q. All right, an offer. A. Yes. Q. And the offer was that she was giving you the house at Georges Hall - that's what you say, isn't it? A. Providing we pay Anastasia $100,000. … Q. But in that arrangement, your mother got nothing out of the offer and acceptance, did she? A. Well, she - she got a - a granny flat that was designed and renovated for herself, for her to live in. Q. When was she going to live in that? A. Well, once it was completed because my husband couldn't do all - everything all in one hit. I mean, it's a big block of land. Q. Sorry, are you saying that there was some conversation in relation to your mother living in the granny flat at some point in time? Is that what you're saying? A. Well, over the - when the house was being renovated in 2009, yes, we had to cut the whole flat, it was disgusting, it was cockroach infested, floorboards were lifted up. It was a block toilet outside - it was an outdoor toilet. And it was a lot of work - outside and the granny flat. And we said, "We'll fix the granny flat, make it, like, for her disability" - which we did, we had everything lovely and - and renovated for her, safe, we supplied handrails and everything, kitchen, everything. But she didn't want to come back - she said she's comfortable at my sister's house.
24. Fourthly, at (T 32.33-32.39): Q. So are you saying there was some discussion - even before your husband did any renovations or any work on the granny flat, are you saying before that, there was some discussion with your mother about coming to live in - let me finish - coming to live in the granny flat? Before-- A. Well, we did say that she was going to live in the granny flat. We were going to - we were going to renovate it. I mean, she - she heard that, she knew that.
25. Fifthly, at (T 36.28-36.46): Q. Why didn't you refer to the conversation you say you had with your mother about her moving back into the granny flat. Why did you not mention that? A. Because I'm - I - I knew that she would come back to the granny flat because the purpose was to fix the granny flat for her. That means - that's - that's what I wanted to do, and my husband wanted to do to, you know, appreciate my mum you know, she was my mum, and you know, for all the - the beautiful things that's she's done for - for us and in my life. I mean who - who would not want to build a nice granny flat for my mum, and especially with her disability. I mean, it was my husband and I's idea that we'll fix it nice for her. I mean I don't there's anything wrong about that. Q. I'm not saying here's necessarily anything wrong Mrs Saitannis, what I'm asking you is why you made absolutely no reference to that in your affidavit, and you've got no explanation have you? A. Well, because we knew it was going to be the plan, like that - the plan was to fix the granny flat. I mean we - we've had the discussion, but maybe I just over - over - didn't think about putting it in writing because we're pouring our heart, and out you know, our paying the money to fix it. I mean we weren't gonna leave the granny flat not fixed, for her. Like - it just don't make sense.
26. And finally, at (T 37.12-37.18): Q. Was that part of the offer that was made back in mid-2009? A. Well, when she's referring to the house - the house, the property has got the granny flat, so yes. We - we put over everything that was on the actual property. I mean we had to think that we had four kids, I mean yes, I want the kids to enter and say hello to their grandmother, I mean - it's their grandmother and yes, we had to fix the outside which was a lot of work. It was a maze, it was trees, it was dangerous, I mean it was hard yakka.
27. This evidence was apparently so inconsistent with Irene's case that counsel challenged Helen with the riposte (T 32.11 and 34.16) that there was nothing in Helen's affidavits about agreeing with Irene that she would move back into the Georges Hall property after the granny flat was renovated. Counsel suggested to Helen that her evidence was a reconstruction (T 33.35 and 37.20), and Helen's ultimate response was (T 37.10): "I may have forgotten. I'm human, I may have forgotten."
28. The evidence that counsel elicited may not have suited Irene's case, but to my mind it was completely credible, and provides a rational basis for understanding the true arrangement between the plaintiffs and Irene. On the plaintiffs' case, they accepted an offer by Irene to give them the Georges Hall property worth $500,000 for a payment of $100,000 to Anastasia but nothing to Irene, and left Helen's aged and infirm mother homeless save for the good will of her daughters. The arrangement is much more explicable, and in good conscience, if the proposal was that the plaintiffs would renovate the granny flat and care for Irene while she lived in the granny flat for the balance of her life. If that were the arrangement, it would be more explicable why Irene would have considered it fair to her other daughters to leave the Georges Hall property solely to the plaintiffs in her will.
29. Based on the whole of the evidence, I could not find that the plaintiffs have made out their case concerning the terms of the arrangement that they made with Irene, without adding the additional component that Helen disclosed for the first time in cross-examination.
30. My judicial experience is that it is common for parties and their lawyers to propound relatively extreme versions of the cases that may be available to them, when a careful and sober consideration of the evidence and the probabilities would lead them to understand that the true legal position lies somewhere between the extremes propounded by the parties. In some cases, the adoption of mutual ambit positions may not lead to forensic disadvantage, but in other cases, the effect will be that the parties do not lead the evidence necessary to properly contest the middle ground where the just legal outcome of the case is likely to be found. In the present case, the parties remained in their chosen trenches throughout the hearing, and did not address in any meaningful way the reasons why what I have found to be the real arrangement between the plaintiffs and Irene was never implemented.
31. Helen's evidence on the subject was the following snippet (T 34.20-34.36): Q. But don't you accept that that is an important part of your case, that the arrangement was going to be that she would move into the granny flat after the renovations were done? Isn't that an important part of your case? A. Well, in writing, yes. But we're a family, and she knew - she knew that she had to vacate at my sister's so we can do the next part. Like, we - we couldn't have her from 2009 living in there while Louis was fixing it, and then once we moved in we kept on - like once the - the flat was completed we said to her, "Are you ready to come?" We - we were asking her numerous amounts, "Come back. You want to see the grandkids; you want to help out? Come back. Come back." And she just kept on refusing, "No, I'm comfortable. I'm comfortable here. I don't want to get involved in your married - in your marriage," in the Greek terminology. Q. Well, then why do you not refer to any of that in your affidavit? Why? A. Because I knew my mum was meant to come back, and she knew that she was meant to come back to her granny flat. I mean, we've discussed it; we were discussing it throughout the whole renovation stage.
32. Irene gave evidence in par 102 of her primary affidavit that she had a conversation with Helen in about June 2009 in which she said: "… I will let you move into [the Georges Hall property] temporarily provided that you provide full-time care for me in my house after I have my hip replacement in November 2009 and provided that you save money to buy another house to move into once the children grow up a little, these are my conditions, Helen". Irene claimed at the hearing that the plaintiffs' occupation of the property was only to be temporary, but she did not prosecute a case that the arrangement was that the plaintiffs would care for her at the property in return for being allowed to occupy it as their home.
33. Irene's evidence on the same subject in cross-examination was (T 162.14-162.39): Q. Who's idea was it? Who first raised the idea of you moving into the Georges Hall property? A. WITNESS: Ask them. A. INTERPRETER: You can ask them. Q. So, did you observe your daughter upset and suggest to her that she could move into your property at Georges Hall to provide full-time care for you? Did you suggest that to her? A. INTERPRETER: Yes-- A. WITNESS: She changed the mind all the time. A. INTERPRETER: So, yes, I said that. But I - one day she says one thing and then she says another. She gets you confused. A. WITNESS: I'm old woman. A. INTERPRETER: And yeah - I'm an old woman. A. WITNESS: If you then can't make decision, I make decision by myself when I bought the house and my husband. I don't need anybody else. Q. So, it was your idea - the idea of Helen moving into Georges Hall - is that right? A. WITNESS: They saw - or seen the situation and what I said. You no coming to my house - because they know there wasn't even there. A. INTERPRETER: Because it's kind of Greek and English, I'm getting confused. So, what she's saying is that they haven't paid for the bill - the water bills. How could they possibly have saved money at - there - at Macquarie Fields house. A. WITNESS: Why they not pay the bills they use?
34. This extract from the cross-examination demonstrates the difficulty experienced by the interpreter, the cross-examiner and the Court as a result of Irene answering questions in English that were required to be translated by the interpreter. There is an element of confusion in this cross-examination as to whether it concerns Helen moving into the Georges Hall property or Irene doing so. Irene appears to say, however, that Irene suggested that Helen could move into the Georges Hall property to provide full-time care to Irene, but Helen changed her mind all the time.
35. If I am correct in my acceptance of the evidence given by Irene in her affidavit and by Helen unexpectedly in cross-examination that there was an expectation as between the plaintiffs and Irene that she would return to live in the granny flat at the Georges Hall property after it had been renovated, it must also be said that Irene did not give any positive or clear evidence as to why she did not take advantage of that part of the arrangement. There was no evidence that Irene complained that the plaintiffs were not performing their part of the arrangement until Irene delivered the letter on 18 January 2020 requiring the plaintiffs to vacate the Georges Hall property.
36. It must be noted that it was Irene's evidence that her discussion with Helen concerning moving back into the Georges Hall property after she had her hip replacement was that it happened in June 2009. The operation was carried out in late 2009. That was the time when the plaintiffs put their Macquarie Fields property on the market for sale, but it took them the best part of a year to find a buyer at a reduced price. The plaintiffs continued to live in the Macquarie Fields property. Irene vacated the Georges Hall property in anticipation of her operation, and arrangements were made while she was in hospital for her to be able to live with Anastasia after her discharge from hospital. It appears that it was necessary for that arrangement to continue because the plaintiffs remained in their smaller home. It is a matter for speculation, but it is possible that Irene became settled in Anastasia's home and remained there through inertia. It would be wrong for the Court to make any positive finding about the reason why Irene did not return to the Georges Hall property to live in the granny flat, as the evidence shows that, when the plaintiffs moved into the property, they had four very young children, and Irene may have thought it would be intrusive and selfish for her to move in and expect to be cared for by the plaintiffs.
37. Whatever the real reasons may have been that caused Irene to continue living with Anastasia rather than to move into the granny flat, on the evidence the plaintiffs were allowed by Irene to believe that they were performing the arrangement in a satisfactory way for almost 10 years until the delivery of the letter.
38. The result has been that the parties did not in any meaningful way forensically examine the question of why Irene did not move back into the granny flat after it had been renovated, and why she remained indefinitely living with Anastasia, and being cared for by Anastasia. Irene did give evidence that she had a hip replacement in late 2009 (T 121.29), and a knee operation in 2013 that caused her terrible pain and that she acquired sleep apnoea (T 122.45), and that she also went to hospital for treatment for cancer (T 124.30) and she had other health issues. There was some background evidence that Irene did not have good personal relations with Louis, although Helen claimed that they had "a lovely relationship" (T 27.44).
39. A result of the forensic choices made by the parties is that, while the Court finds that the arrangement as asserted by the plaintiffs is made whole by the addition of a mutual expectation that the plaintiffs would care for Irene for the balance of her life after she moved back into the granny flat, the Court cannot be confident of the precise nature of that arrangement, and cannot make any positive or comprehensive finding as to why the arrangement was not implemented.
40. Whatever the true reason was, Irene did not move back into the granny flat and was not cared for by the plaintiffs. Rather, she continued to live with Anastasia and it was Anastasia that provided the care that she needed. Irene nonetheless implemented her part of the arrangement when she made her will on 23 January 2012. Time passed, and as it did so, the reasonableness of the Georges Hill property being left entirely to Helen, and being denied to Anastasia, and perhaps Georgina, became gradually less and less obvious. Eventually, Irene decided she wanted to move back into her long-time matrimonial home, so on 18 January 2020, Irene delivered to the plaintiffs her letter requiring them to vacate the Georges Hall property by 1 May 2020. Irene made her new will on 11 March 2020. Irene's evidence was (T 118.18) that when she sought to repossess her property she said: "I went there and I said, 'I am healthy now and I want to go back home - I want to come back home'." Further (T 134.46): "I wanted - I just wanted to go home. I just want to go to my house. After all these years I was feeling better, and I - so, I told Anastasia I want you to take me there, and I gave them three months' notice, and I - in a nice way - in a Christian way." Finally (T 135.10): "And I just want to go home and be able to mourn my husband and mourn my - my - my - my life."

Consideration

1. When members of families make arrangements, such as the arrangement the subject of these proceedings, they do not generally intend that they will be legally binding. It is not the force of law, but family loyalty and affection that is intended to bind the parties to the arrangement. They do not always think or talk in precise terms and there is often an inherent indefiniteness in the arrangement and a readiness to allow it to evolve. However, it is often a consequence of the way that the arrangements are implemented that fairness and good conscience require equity to intervene to provide a disappointed party to the arrangement with relief. Proceedings to enforce such arrangements will often involve an exceptional level of forensic risk because of the essential indefiniteness of the arrangement. That is often why the parties to such arrangements will be best served by responding to disagreements by making reasonable compromises.
2. The parties to family arrangements do not, of course, think in terms of categories of equitable principle, such as common intention, joint endeavour, encouragement or standing by. In the present case, the plaintiffs have sought to portray the arrangement as being one involving a representation concerning the ownership of a property that has given rise to an equitable proprietary estoppel by reason of the plaintiffs having relied upon the representation in ways that will lead to their substantial detriment if Irene is permitted to resile from the promise implicit in her representation. As I have recorded above, the plaintiffs pleaded that there was a common intention between the parties, but the common intention alleged did not include that the plaintiffs would provide a benefit to Irene for her life by looking after her in the granny flat after it was renovated. I have found that the arrangement between the parties included that element. The boundaries of that element are indistinct because none of the parties embraced it in a positive way and it only emerged as a revelation in the evidence given by Helen, and, although the subject of evidence by Irene, it was not embraced as an important aspect of Irene's case.
3. There may be scope for argument as to how the arrangement between the parties should be analysed in terms of equitable principle. It should not be assumed that all such family arrangements will be capable of being analysed strictly in terms of representations, the creation of common intentions, or the pursuit of joint endeavours. It may be that some arrangements should be analysed in terms that have different features of these equitable conceptions at the one time. If the arrangement between the parties is best analysed in terms of representations, it would not be limited to representations made by Irene, but would include the representation made by the plaintiffs that they would make available the renovated granny flat for Irene's occupation and that they would allow her to live there and they would care for her for the rest of her life.
4. The better approach may be, however, to consider the arrangement partly in terms of a joint endeavour that ultimately failed. Through that lens, the representation that constituted the plaintiffs' part of the arrangement that involved Irene occupying the granny flat and being cared for by the plaintiffs was not implemented in fact. If the arrangement is viewed as a joint endeavour, it failed in the same respect. However, if the arrangement is analysed in terms of either equitable principle, by reason of the forensic approach adopted by the parties that I have explained above, the only finding available to the Court is that Irene did not receive that part of the arrangement that would have provided the primary benefit to her. The Court cannot make a finding as to the true reason for that outcome, and must proceed upon the basis that the arrangement was ultimately not implemented through no proved fault of the parties.
5. Before I consider the equitable principles that should be applied to resolve this dispute, it will be appropriate to collect my findings concerning the terms of the arrangement made between the parties and the consequences of the parties implementing that arrangement, or not, as the case may be. I qualify the summary that I will give with the observation that the evidence does not permit precise findings concerning the terms of the arrangement and some aspects of the arrangement are less distinct than others because of the forensic approach taken by the parties to the hearing. 1. Irene gave the plaintiffs possession of the Georges Hall property on the basis that they and their children could make their home indefinitely in that property. Irene led the plaintiffs to believe that their tenure in the property was of sufficient probable duration to justify the plaintiffs in making the effort and incurring the expense necessary to make significant renovations to the property so that it would be appropriate for their use as a family home. It is not clear whether there was any definite arrangement as to the duration of the plaintiffs' occupation of the property. The better view is that Irene at least accepted that the occupation would continue during the younger childhood of the plaintiffs' four children and to a time when the plaintiffs could accumulate sufficient money to enable them to acquire a reasonably equivalent property in their own names. To the extent that this duration was considered, it was entirely indefinite. At the present time, the plaintiffs' oldest child is about 17 and the youngest child is about 13. 2. The evidence given by the plaintiffs as to the terms of the arrangement would support a finding that Irene agreed to leave the Georges Hall property to the plaintiffs in her will, which is something that Irene did on 23 January 2012. Wills are, however, inherently revocable, and it is not completely clear whether Irene's undertaking to leave the property to the plaintiffs was intended to be irrevocable or dependent upon the continuation of the provision by the plaintiffs to Irene of some expected benefit. 3. One aspect of the arrangement was that the plaintiffs would pay $100,000 to Anastasia, and that part of the arrangement was implemented. 4. It is more probable than not that an aspect of the arrangement was that, after the granny flat at the Georges Hall property had been renovated, Irene would return to the property to live there at her pleasure for the rest of her life. If that had happened, then the plaintiffs and their children would have cared for Irene and treated her as part of their family. This aspect of the arrangement was not implemented and the Court is not able to make definite findings as to why not. It may be that Irene did not initially want to suffer the inconvenience of relocating from Anastasia's house to the granny flat. Continuing and new ailments and disabilities may have influenced Irene's decision. It cannot be known whether changes in the family dynamics or the relationship between Irene and Louis influenced Irene's choice. 5. The part of the arrangement whereby Irene would return to live in the granny flat and be cared for indefinitely by the plaintiffs was nonetheless an important part of the arrangement, as without it the arrangement may have been unconscionable on the plaintiffs' part, by reason of the advantage that the plaintiffs would have taken of the vulnerabilities from which Irene was suffering at the time. 6. The plaintiffs' reliance on their arrangement with Irene caused them to suffer some costs and inconveniences and to forgo opportunities. 1. First, Helen paid Anastasia $100,000. There has been no offer from Anastasia to repay that money, and its recovery is probably now statute barred. 2. Secondly, the plaintiffs carried out substantial renovations of the Georges Hall property. While those renovations have apparently only added $100,000 to the present value of the property, I am satisfied that the costs to the plaintiffs were substantially higher than that amount. Louis gave evidence of the costs in broad terms, but his evidence was not challenged. It is not surprising in the circumstances that the plaintiffs have not been able to prove the costs they incurred with precision. The costs claimed are not, in my opinion, improbable. Louis gave evidence that the plaintiffs spent $80,000 on the initial renovations from their own funds and that they were given $30,000 by Louis's father for the same purpose. Later they borrowed $50,000 from Westpac to complete the renovations. The total is $160,000. Louis said that the plaintiffs spent $90,000 renovating the granny flat, but it is not clear from the evidence that this expenditure was in addition to the sums that I have just stated. The total amount of $160,000 does not include recompense to Louis for the substantial time that he must have spent in carrying out the renovations. 3. Thirdly, the evidence establishes that, if the plaintiffs had retained ownership of their Macquarie Fields property, they would have enjoyed a $500,000 increase in capital value above the $350,000 sale price in 2010. The total of those measurable costs is $760,000, say $800,000 if a relatively small amount is added for Louis's personal effort.
6. Crucially, if Irene is permitted to resile entirely from the arrangement that she made with the plaintiffs and she is given the relief that she seeks in these proceedings, the plaintiffs and their children will be 'out on the street' with no recompense for their expenditures. There were other costs and savings that probably cancel out, given that the plaintiffs and their family have had the benefit of living in the Georges Hall property rent free from 2010 to the present day, subject of course to Irene's claim for an occupation fee from 2 May 2020. The plaintiffs have paid the rates and other charges for occupying the property, but these expenses were a condition of their occupation, and they would have been required to pay comparable amounts had they retained their Macquarie Fields property. The plaintiffs have not been required to pay rent or make mortgage repayments, but that was a factor inherent in the arrangement.
7. These factors must be balanced against the detriment that Irene will suffer if a declaration is made that she holds the Georges Hall property on trust for the plaintiffs. The payment of the $100,000 to Anastasia must be treated as a benefit to Irene, because it was made at Irene's request. However, the Georges Hall property had a value of $500,000 at the time, so the implementation of the arrangement would involve Irene making a gift of $400,000 plaintiffs. In doing that, she would, at the age of 65, have given away her only substantial asset and the roof over her head. There was some evidence that as of 14 December 2017, Irene had a bank account with credit of $159,431. That evidence was tendered in the context of proving the $25,000 loan from Irene to the plaintiffs. There was no evidence that Irene had other assets of substantial value that she could use to provide a home for herself, or to provide inheritances to her other two daughters that would match the effect of the implementation of the arrangement as alleged by the plaintiffs. The consequence of Irene not returning to live in the granny flat at the Georges Hall property was that the obligation to provide a home to Irene was thrown upon Anastasia. The need for Anastasia to provide indefinite care to Irene followed from the requirement that Anastasia provide a home to Irene. So long as the plaintiffs retain their sole right to possession of the Georges Hall property, Irene will not have the wherewithal to provide a home for herself.
8. The submissions made by the plaintiffs concerning the applicable legal principles assumed that the Court would find that Irene made representations to them that, if they paid $100,000 to Anastasia, she would treat the plaintiffs immediately as the real owners of the Georges Hall property and that they would become the legal owners by Irene leaving the property solely to the plaintiffs in her will. It was on that assumption that the plaintiffs submitted that the equity of the case justified the Court in making a declaration that fulfilled the expectation that Irene's representations caused the plaintiffs to have, and upon which relied in taking the steps that I have found above that they did take. The plaintiffs submitted that the detriment that they would suffer if Irene was permitted to resile from the representations was so substantial that the relief granted should realise the plaintiffs' expectations.
9. The problem the plaintiffs' case faces is that the Court has found that the representations that the plaintiffs alleged were made by Irene have not entirely been proved. There is sufficient evidence to justify a finding that Irene represented that she would leave the Georges Hall property to the plaintiffs in her will, but the evidence does not justify a finding that she represented that the plaintiffs would be entitled to immediate ownership of the property. That is because there was a counter-representation made by the plaintiffs, or an expectation on Irene's part, which was an integral part of the family arrangement, being that Irene would move back into the Georges Hall property to live in the granny flat for as long as she wished, and that she would be cared for by the plaintiffs. Irene would continue to be the owner of the property until her death. The counter-representation or expectation was not implemented. That was through no proved fault of any party. The consequence is that Irene does not have her own home, and, as long as that is the case, the need to provide a home and care for Irene is thrust upon Anastasia. That outcome would turn a family arrangement that might otherwise have been equitable into an unconscionable one on the plaintiffs' part, at least to the extent that they pursue relief that would have the effect that they have the sole right to occupy the property to the exclusion of Irene. I do not think it matters whether that consequence is considered as a failure by the plaintiffs to implement the expectation that they created in Irene, or whether it is treated as a failure of a joint endeavour without fault of the parties.
10. Unlike cases in contract where the Court enforces the promises made by the parties because those promises are enforceable as a matter of legal principle, in cases such as the present the Court moulds a remedy to suit the occasion, where the departure by a party from a representation made by the party would be unconscionable by reason of the detriment that the other party would suffer. The availability and nature of the relief is tied to the degree of unconscionability associated with the detriment that flows from the departure from the representation. There may be cases where, by reason of changes in circumstances with the passage of time, the degree of unconscionability may attenuate or disappear. In the present case, there was a degree of mutuality in the arrangement between the parties that the plaintiffs have ignored and Irene has not embraced. There was an issue at the hearing as to whether, with the passage of time, Anastasia became embittered by the preference shown by Irene to the plaintiffs, and whether she consequently undermined Irene's adherence to the arrangement propounded by the plaintiffs. All that need be said is that it is unsurprising, if Irene decided to prefer the plaintiffs because she would live with and be cared for by them, that Anastasia came to resent the arrangement as it fell to her to provide a home for and care for Irene.
11. As equity is not inclined to let the loss lie where it falls, it is necessary to determine the relief that ought to be granted to do equity and justice between the parties. On the basis that their claim is that they have an equitable proprietary estoppel that entitles them to a declaration that Irene holds the Georges Hall property on trust for them, the plaintiffs relied upon the principles espoused by Brereton J (as his Honour then was) in Evans v Evans [2010] NSWSC 170. However, the submission focused only on the meaning of his Honour's reasons insofar as they apply to the case where the representation upon which the claimant has relied was unqualified. It will be instructive to extract the relevant part of his Honour's reasons in full, as follows: [37] While numerous judicial and academic attempts have been made over the years to catalogue the elements of an [equitable proprietary] estoppel of this type (see, for example, Fry J's five probanda in Willmott v Barber (1880) 15 Ch D 96; Brennan J's six proofs in Waltons v Maher; Priestley JA's seven propositions in Silovi Pty Ltd v Barbaro (1988) 13 NSWLR 466, as modified in Austotel Pty Ltd v Franklins Selfserve Pty Ltd (1989) 16 NSWLR 582; and Meagher, Gummow and Lehane's six common factors in Equity Doctrines and Remedies, 4th Edition (2002), [17-105]), it suffices for present purposes to observe that, at least generally speaking, the matters that a plaintiff must establish to found such an equitable estoppel may be characterised as comprising certain conduct of the plaintiff, certain conduct of the defendant, and certain qualities of the subject matter, which for present purposes, may be sufficiently summarised as follows. [38] First, as to the conduct of the plaintiff, that the plaintiff acted, or abstained from acting, in reliance upon an assumption or expectation that a particular legal relationship existed or would exist between the plaintiff and the defendant or that the plaintiff had or would acquire some interest in the defendant's property. Secondly, as to the conduct of the defendant, that the defendant induced the plaintiff to adopt the assumption or expectation and encouraged the reliant activity of the plaintiff, or at least failed to deny the assumption or expectation with knowledge that the plaintiff was relying on it to the plaintiff's potential detriment, and that the expectation could be fulfilled only by transfer of the defendant's property, a diminution of the defendant's rights or an increase in the defendant's obligations. Thirdly, as to the subject matter, that the assumption or expectation in respect of it was one that the defendant could lawfully satisfy. Ordinarily the relevant conduct of the plaintiff (assumption or expectation) and that of the defendant (encouragement or acquiescence) will be factually interrelated and interwoven [see generally Waltons v Maher, 428-429 (Brennan J); Meagher, Gummow & Lehane, [17-105]; O'Neill v Williams [2006] NSWSC 707, [40]]. [39] One form that this equity sometimes takes is to convert a revocable licence to occupy premises into an irrevocable or permanent one. Thus in Vinden v Vinden [1982] 1 NSWLR 618, Needham J considered circumstances in which a licence to occupy property, which was expressed to be subject to the licensee making contributions to mortgage payments and rates would become irrevocable by the licensee (in Vinden, the defendant, whom the plaintiff owner was endeavouring to eject), acting to his detriment upon the expectation that he would be permitted to remain in the property indefinitely. His Honour referred to Plimmer v Mayor of Wellington (1884) 9 App Cas 699, in which a revocable licence to occupy a jetty was held by the Privy Council to have become irrevocable by reason of the licensee incurring expenditure on improvements in the expectation, encouraged by the licensor, of being permitted to remain indefinitely. Plimmer and Vinden both illustrate that an owner of land may become bound by an equitable obligation to permit an occupier to remain permanently, if the occupier, to the knowledge of the owner, acts to his or her detriment in reliance upon an expectation of being permitted to remain indefinitely, and that in such circumstances the occupier requires a correlative equitable right to remain. [40] In some cases, an equity that arises by estoppel in this way may be conditional upon the performance by the plaintiff of certain obligations, as Vinden also shows. Where there are conditions attached to the expectation - such as contributing to outgoings - the equity is subject to performance of those conditions by the licensee. As Needham J said (at 625B) (emphasis added): In my opinion, while the defendant continued or remained willing to meet those obligations , his licence was irrevocable, or, to put it another way, an equity arose which could be satisfied only by holding the plaintiff estopped from denying that the licence was irrevocable. [41] That a plaintiff will not be able to enforce an equitable interest by way of proprietary estoppel so long as he or she is in default of a condition attached to the enjoyment of the equity appears also from Wood v Browne [1984] 2 QdR 593 and Beaton v McDivitt (1985) 13 NSWLR 134 at 157C-D; see also Young, Croft & Smith, On Equity, [12.310], and O'Neill v Williams, [42] - [43]. The plaintiff can be relieved from the performance of such conditions by conduct of the defendant - for example, by the defendant making it impossible for the plaintiff to meet the condition and also by release, agreement or even acquiescence [O'Neill v Williams, [44] - [45]]. Vinden illustrates this, as the plaintiff (legal owner) made it impossible for the defendant (occupier) to pay the mortgage, by paying it out himself, and to pay the rates, by having the notice redirected.
12. In the present case, I am satisfied that the evidence justifies findings in favour of the plaintiffs that would satisfy the requirements stated by Brereton J at [38]. However, that is not the end of the matter because the evidence requires a finding that the assumption or expectation that Irene encouraged the plaintiffs to adopt was not unqualified. There was a counter-assumption or expectation that, after the plaintiffs had renovated the granny flat, Irene would return to live there and be cared for by the plaintiffs for as long as she wished, putatively for the rest of her life. The difficulty I have faced in this case, which I have tried to explain above, is that the paucity of evidence has prevented the Court from confidently characterising the counter-assumption or expectation. The better view is that it did not have the effect of being a condition to the plaintiffs being entitled to act upon the assumption or expectation that Irene encouraged them to adopt. But there was, as it were, a quid pro quo, in that the plaintiffs were expected to earn the benefit of their assumption or expectation by in turn providing a benefit to Irene. As I have also said above, the evidence does not permit a reliable finding about why the plaintiffs did not provide the benefit to Irene, or why she did not insist upon it. Nonetheless, I am satisfied that when the evidence as to the nature of the arrangement is considered as a whole, the plaintiffs did not have a reasonable basis for expecting that they would definitely be entitled to enjoy the full measure of the assumption or expectation induced by Irene, even if they did not reciprocate by providing any of the benefit that Irene assumed or expected.
13. This is a case where it will be necessary for equity to strike a fair and equitable balance, having regard to the extent that the plaintiffs will suffer detriment if Irene resiles from the assumption or expectation that she induced in the plaintiffs, to the fact that the plaintiffs have not been required to provide the benefit that Irene expected to receive, and to the reality that relief that will oblige Irene to implement the assumption or expectation induced in the plaintiffs will disproportionately disadvantage her by leaving her with nothing.
14. This is a case where the following extract from the joint judgment of French CJ, Kiefel, Bell and Keane JJ in Sidhu v Van Dyke (2014) 251 CLR 505; [2014] HCA 19 applies (footnotes omitted): [82] In Giumelli v Giumelli, Gleeson CJ, McHugh, Gummow and Callinan JJ held that, because the fundamental purpose of equitable estoppel is to protect the plaintiff from the detriment which would flow from the defendant's change of position if the defendant were to be permitted to resile from his or her promise, the relief granted may require the taking of active steps by the defendant including the performance of the promise and the performance of the expectation generated by the promise. That holding is supported by the leading decisions to which this category of equitable estoppel is usually traced. [83] The requirements of good conscience may mean that in some cases the value of the promise may not be the just measure of relief. In The Commonwealth v Verwayen, Deane J noted that: "There could be circumstances in which the potential damage to an allegedly estopped party was disproportionately greater than any detriment which would be sustained by the other party to an extent that good conscience could not reasonably be seen as precluding a departure from the assumed state of affairs if adequate compensation were made or offered by the allegedly estopped party for any detriment sustained by the other party." [84] If the respondent had been induced to make a relatively small, readily quantifiable monetary outlay on the faith of the appellant's assurances, then it might not be unconscionable for the appellant to resile from his promises to the respondent on condition that he reimburse her for her outlay. But this case is one to which the observations of Nettle JA in Donis v Donis are apposite: "[H]ere, the detriment suffered is of a kind and extent that involves life-changing decisions with irreversible consequences of a profoundly personal nature … beyond the measure of money and such that the equity raised by the promisor's conduct can only be accounted for by substantial fulfilment of the assumption upon which the respondent's actions were based."
15. Here, the circumstances appear to lie somewhere along the spectrum between a small, readily quantifiable monetary outlay and life-changing decisions with irreversible consequences contemplated by their Honours. The relief that is appropriate will require a careful balancing of the particular circumstances of this case.
16. The indefiniteness of the evidence that I have described above raises the possibility that the preferable approach to determining the equitable principle that should be applied is not to think in terms of an assumption or expectation induced in the plaintiffs that was conditional or subject to a counter-assumption or expectation induced in Irene. The arrangement entailed Irene retaining ownership of the Georges Hall property, the plaintiffs agreeing to renovate the property including the granny flat, the plaintiffs selling their existing home and paying $100,000 to Anastasia, the plaintiffs living indefinitely in the property with their children, the plaintiffs paying the running costs of the property, Irene returning to live in the granny flat and being cared for indefinitely by the plaintiffs, and Irene leaving the property solely to the plaintiffs in her will. That being the case, it may be proper to view the arrangement as a joint endeavour that failed in part through no fault of the parties.
17. In Muschinski v Dodds (1985) 160 CLR 583; [1985] HCA 78 at 618-620, Deane J said (footnotes omitted): Both common law and equity recognize that, where money or other property is paid or applied on the basis of some consensual joint relationship or endeavour which fails without attributable blame, it will often be inappropriate simply to draw a line leaving assets and liabilities to be owned and borne according to where they may prima facie lie, as a matter of law, at the time of the failure. … Where, however, there are no applicable contractual provisions or the only applicable provisions were not framed to meet the contingency of premature failure of the enterprise or relationship, other rules or principles will commonly be called into play. … … The prima facie rules respectively entitling a fixed term partner to a proportionate refund of his or her premium and a contractual joint venturer to a proportionate repayment of his or her capital contribution on the premature dissolution of the partnership or collapse of the joint venture are properly to be seen as instances of a more general principle of equity. … Like most of the traditional doctrines of equity, it operates upon legal entitlement to prevent a person from asserting or exercising a legal right in circumstances where the particular assertion or exercise of it would constitute unconscionable conduct: cf Story, Commentaries on Equity Jurisprudence, 12th ed (1877: Perry ed.), vol. 2, par. 1316; Legione v Hateley. The circumstances giving rise to the operation of the principle were broadly identified by Lord Cairns L.C., speaking for the Court of Appeal in Chancery, in Atwood v Maude: where "the case is one in which, using the words of Lord Cottenham in Hirst v Tolson, a payment has been made by anticipation of something afterwards to be enjoyed [and] where … circumstances arise so that future enjoyment is denied". Those circumstances can be more precisely defined by saying that the principle operates in a case where the substratum of a joint relationship or endeavour is removed without attributable blame and where the benefit of money or other property contributed by one party on the basis and for the purposes of the relationship or endeavour would otherwise be enjoyed by the other party in circumstances in which it was not specifically intended or specially provided that that other party should so enjoy it. The content of the principle is that, in such a case, equity will not permit that other party to assert or retain the benefit of the relevant property to the extent that it would be unconscionable for him so to do: cf Atwood v Maude, and per Jessel M.R., Lyon v Tweddell.
18. This approach was approved in Baumgartner v Baumgartner (1987) 164 CLR 137; [1987] HCA 59 by Mason CJ, Wilson and Deane JJ at 147-148, as well in substance as by Toohey J at 152 and Gaudron J at 155.
19. There may be some need to adjust the application of these principles in the present case to account for the fact that the arrangement may be analysed partly in terms of mutual representations as to future conduct, and partly as a joint endeavour that has partially failed. In my view, the determination of the equitable relief that should be granted in this case should not differ depending upon the approach that the Court prefers as to the equitable principles that should be applied to the resolution of the dispute.
20. It is also necessary to bear in mind the following observation by the plurality in Baumgartner v Baumgartner at 150: … The court should, where possible, strive to give effect to the notion of practical equality, rather than pursue complicated factual inquiries which will result in relatively insignificant differences in contributions and consequential beneficial interest. …
21. During senior counsel for the plaintiffs' oral submissions, I raised the possibility that the Court may make the finding - that I have in fact made - that the arrangement between the parties involved mutual representations that constituted a joint endeavour that has failed in part. That finding would lead to the possibility that some relief other than the primary relief sought by the plaintiffs was appropriate. One possibility was that the appropriate remedy was an order that Irene pay the plaintiffs equitable compensation for the detriment the plaintiffs would suffer if Irene departed from her representation that she would leave the Georges Hall property to the plaintiffs in her will. Another possibility is that the Court make an order that had the effect that Irene would be obliged to bequeath the property to the plaintiffs, but that they would have no right to continue in occupation of the Georges Hall property because Irene is not living in the granny flat and being cared for by the plaintiffs. Senior counsel responded by saying that the plaintiffs wished to reserve their right, if that were possible, to elect between remedies after the Court delivered these reasons for judgment.
22. As it has happened, the parties have not had the opportunity to make submissions to the Court as to the precise terms of the relief that will be appropriate based on the findings that I have made in these reasons. I have to this point stopped short of formulating positive alternative orders that may be the subject of an election by the plaintiffs. It may well be that an order for payment of equitable compensation is the most appropriate form of relief. As I have said above, a quantum of equitable compensation of $800,000 would be justified in this case. The alternative, whereby the plaintiffs would have an entitlement to receive the Georges Hall property under Irene's will, but have no home or right to compensation until they gain title to the property, does not seem to be a convenient form of relief.
23. Having regard to the request made by senior counsel, I propose to publish these reasons and give the parties an opportunity to confer and to deliver further written submissions on the form of the relief that should be granted, based upon the findings that have been made in these reasons. I do not know whether there remains any possibility for the parties to salvage some mutually acceptable resolution of the dispute that does not depend upon the choice made by the Court.
24. In the circumstances, it is not necessary for the Court to deal with the plaintiffs' alternative quantum meruit claim. Although the evidence given by the plaintiffs about the nature and cost of the renovations that they undertook was sufficient to sustain their equitable proprietary estoppel claim in part, it may not have been sufficiently precise to establish the reasonable cost of the works.
25. As Irene has not succeeded in her cross claim in establishing a right to possession of the Georges Hall property from 2 May 2020, she has not established a right to an order against the plaintiffs for an occupation fee for that period. Irene's rights in relation to possession of the property will be subsumed in the relief that the Court ultimately grants in respect of the principal dispute between the parties.
26. In relation to Irene's claim for an order that the plaintiffs repay her a debt of $24,500, I have noted above that, in the plaintiffs' defence to Irene's cross claim they pleaded that they had repaid $2,000 plus additional unspecified repayments. Irene accepted that an amount of $500 had been repaid, but it was Helen's evidence that she had made two payments of $500 (T 30.1). If Helen's evidence is accepted, the amount of the debt outstanding is $24,000. Although the evidence on both sides is mere assertion as to the amount repaid, I prefer the evidence of Helen as she was generally the more reliable witness. Accordingly, the plaintiffs should be ordered to repay Irene the sum of $24,000.
27. It will be necessary in due course for the Court to deal with the issue of costs. The parties should make submissions on that issue in conjunction with their submissions concerning the appropriate relief that should be ordered. The parties should bear in mind that, even though the plaintiffs will succeed in obtaining substantial relief, the outcome of the proceedings is likely to be one of approximate equality of result. No party embraced the evidence that was available concerning the mutual representation of the plaintiffs that Irene could return to live in the granny flat and be cared for by the plaintiffs. On the one hand, the Court's acceptance of that evidence prevented the plaintiffs from obtaining the relief that they sought, but also absolved them of the possible consequences of unconscionable conduct in making the arrangement with Irene on the terms contended for by the plaintiffs. On the other hand, the Court's acceptance of the evidence will have been a significant factor in Irene having achieved the degree of success in these proceedings that she will have achieved when the final orders are made.

Amendments 27 October 2022 - Correction to name in paragraph 64 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 27 October 2022