The Chief Justice went on to say that claimants that the ticket was bought on their behalf "have nothing but an equitable interest in the ticket and its proceeds if it wins a prize." The ticket holder is not a trustee or fiduciary agent with any duties other than he must do nothing to impair the equitable rights of those for whom he holds the ticket. The High Court also dealt with questions of lottery wins in Voulis v Kozary (1975) 180 CLR 177 and there have been a number of decisions in this court including my decision in Cole v Crain (16 August 1989, unreported) and Hodgson J's decision in Smith v McDonnell (30 March 1995, unreported). However, none of these decisions really has any bearing on the result.
16 Two decisions of the Family Court also consider the matter. In Re Zyk (1995) 19 Fam LR 797, the Full Family Court had to deal with a case where two years into a marriage the husband won $95,000 in Tatts Lotto. The facts were that the monies from which the ticket had been purchased had come from shared joint income of the parties and the Full Court considered that the lotto win should have been treated by the Court as a joint contribution. This was followed by another Full Family Court decision in Re Brease (1997) 22 Fam LR 518. In that case the wife's money had been used to buy the ticket and the Court held that the lottery winnings should be treated as the wife's contribution to the property in which the monies were spent. The case contains some useful discussion as to what happens when a wife deposits her lottery winnings to a joint account.
17 These cases do not take the present matter any further because, as I have held, the monies used for the ticket were Michael's; he bought the ticket and the proceeds were his.
18 I now must pause and look at the next part of the narrative with considerable care. This is because cases like Voulis v Kozary show that the conduct of a person in whose name a lottery ticket is immediately after the win, may show that in fact other people have beneficial interests in the proceeds.
19 The plaintiff, Michael says that he watched the lotto draw and recognised some of his numbers. He went back to Perry's Newsagency the next day without saying anything to Virginia and asked Mr Perry to check the ticket. He says Mr Perry did so and had a surprised look on his face and turned the computer screen around to show Michael that he had won $500,000. He gave Michael a claim form to fill in, which he did. On about 12 March, Michael received a letter from the Lotteries Office confirming his win. That night, in the presence of Anne and Jessica, he said to Virginia, "I have a big surprise for you all" and he told them that he had won half a million dollars. He showed them the letter from the Lotteries Office which had a form attached to it which he was supposed to return to the Lotteries Office with his bank account details.
20 Michael says Virginia said, "We'll go and open up a joint account for our retirement together. We'll go down to Penrith on Saturday morning." A few days later Michael and Virginia went to Penrith and opened an account in both their names with the Advance Bank, A/C No 33395647. The Lotteries Office deposited the amount of the winnings into that account shortly after 18 March 1993.
21 Although in cross-examination counsel for Virginia attacked Michael's version and had some success in that it was difficult to see how a then 27 year old woman would make a remark about investing with a 44 year old man for their retirement, Virginia herself did not put forward any different version. Indeed, in her affidavit she says she cannot even remember the full circumstances of the opening of the account, but she knows that there was a joint account opened at the Advance Bank in Penrith, and that the monies were there deposited.
22 Without Michael's knowledge, Virginia withdrew virtually the whole amount from the joint account in April 1993 and it found its way into an interest bearing deposit account at the same bank in the name of Anne. There are no bank records available until 27 April 1993. However, it would seem that as at August 1993, Anne's IBD account had $406,000 in it and her ordinary account had a further $60,117 in it.
23 On 1 September Anne opened a further account and $400,000 passed from the former IBD account to Anne's new account. It may well be that these were just a rolling over of $400,000. What happened to the $40,000 being the difference between the balance in Anne's accounts and the $500,000 deposit is partially explained because Virginia says that about $40,000 was used to pay the plaintiff's debts (I actually rejected that evidence), and that the $60,000 was set aside for spending on an overseas holiday.
24 It would also seem that a Pajero motor vehicle was purchased in July 1993 for $50,000. Virginia said that she traded in her motor vehicle as part of the price and that the Pajero was principally driven by Anne. Michael says that the Pajero was registered in Virginia's sole name, and although he has or had possession of it, Virginia claims it is her's.
25 During the period after the return from Coolangatta until 2001, Virginia was not often in gainful employment. She had a couple of jobs as a bar maid in local hotels and drove a taxi for a Mr Daley for about six months in 1995. She commenced driving taxis full time in January 2001. Michael says she lived off the capital from the sale of his Lawson property plus various monies she was receiving from the Commonwealth Government by way of pensions or allowances.
26 Michael says that each week he handed his wages, or at least the balance of his wages, to Virginia and she said that she would be using the money towards the mortgage and other bills. She told Michael that the mortgage had been paid off in about July 2001. However, a search as at September 2002 shows that not only was that mortgage not removed from the title, but also that Virginia had taken out a second mortgage after the separation for a further $50,000. Michael says he knows nothing about that mortgage at all. Michael says that during the period he was living with Virginia at Wentworth Falls he did considerable work and purchased materials which are set out in para 28 of his affidavit.
27 In May 1993, Michael, Virginia, Jessica and Anne travelled to the United States, Italy, France and England, a trip which cost about $50,000. Virginia said that she would take the cost out of the joint account and Michael was happy with this, though we now know that the monies had actually been already transferred into an account in Anne's name. In 1995, the four took a cruise to the Pacific Islands. They took another cruise in 2001.
28 Michael says that in 1997 Virginia told him that she, Anne and Jessica were going to take another cruise, but he would have to stay home and look after the dogs and this occurred again in 1999 and 2002.
29 In about March 1994, Virginia suggested that, "Why don't we buy a property down in the Valley? It will be nice to move there later on". In due course, 32 Cranebrook Park Road, Little Hartley was purchased. Michael said he let Virginia do all the paperwork. She said that Dale Turner, the conveyancer at Katoomba would be retained and that Mr Turner would arrange for the property to be in both names and the money would come from the joint account. Michael was happy with this. In fact the money came from Anne's account and the Little Hartley property was put only in the name of Virginia. From 1996 to 2002, Michael purchased equipment and did work on the Little Hartley property.
30 The Little Hartley property has now been sold and the proceeds, approximately $461,000, have been invested in a controlled monies account with the Commonwealth Bank of Australia pending my decision in these proceedings.
31 Jessica gave evidence for Michael, and against her mother. However, her evidence is affected by the fact that came to light that Michael agreed that he would share any proceeds of these proceedings with Jessica in equal proportions.
32 Michael's case then is that he was entitled to the whole of the lotto monies and that he consented to the expenditure on the overseas trips but he is entitled to the whole proceeds of the sale of Little Hartley, and indeed, he is entitled to an account from Virginia as to what happened with the monies that she withdrew from their joint account. He is also entitled to an order under the Property (Relationships) Act.
33 Virginia's answer is that the lotto monies were half her's (a matter which I have already considered), that she was never in a de facto relationship with Michael, that Michael was her mother's boyfriend, that Anne compelled Virginia to do many of the matters that Michael complains about and that Virginia willingly did them thinking that Anne and Michael were an item, and that Virginia has for some time been in a lesbian relationship and is not interested in a relationship with Michael or any other male.
34 It is interesting that in the evidence Michael was suggesting very strongly that he maintained Virginia over the period from 1990 to 2001, that Virginia did little work and that she occupied most of her time in doing a series of courses. Virginia did not put forward any acceptable concrete material to negative this impression.
35 Looking at the parties' property as at the beginning and end of the relationship (assuming there was a relationship), one comes to the following conclusion, though it is, of course, a simplified version.
36 At the commencement of the relationship Michael had a house at Lawson worth about $125,000 subject to a mortgage of $40,000 which he realized during the relationship for about $60,000 net. In addition, he had a car, furniture, tools of trade and cash of about $20,000 in total.
37 Virginia had the house at Wentworth Falls worth about $80,000 subject to a mortgage of $62,000 and a motor vehicle and bits and pieces totalling probably about $10,000. On Michael's account the parties had probably equal wealth.
38 At the time of separation Michael ended up with $1,050 plus his claims to an interest in the house at Wentworth Falls, an interest in the Little Hartley proceeds and an interest in accounts in Virginia's name with the St George Bank totalling $130,000 and his claim to the Pajero. Virginia has a taxi worth $7,000, cash in an unknown bank account of $140,000 from an insurance claim, plus the legal interest in Wentworth Falls, proceeds from Little Hartley and $130,000 in the St George Bank.
39 It is, I believe, first necessary to consider what is the property interest held by the parties at law or in equity before I consider whether I need to apply the Property (Relationships) Act. It is for this reason that I have so far kept completely away from the allegations and counter-allegations as to where Michael slept during the period 1990 to 2002.
40 As I have already said, I am comfortably satisfied that Michael was the lotto winner. Accordingly, the money paid by the Lotteries Office into the joint account at Penrith belonged to Michael.
41 I must first address the question as to whether the act of placing the money into the joint account, perhaps to which one might add his acquiescence in Virginia's statement that she denies that the money was to be for their retirement, meant that there was a gift of half to Virginia.
42 I also should take into account Michael's acquiescence in what he thought was happening to the money in the joint account, namely it being used for overseas trips for the four people and to be used to buy Little Hartley in the two names. The fact that Virginia or Anne had already appropriated the money into their own names is immaterial for this purpose.
43 I have found little guidance in the inferences that might be drawn from the deposit of X's money into a joint account belonging to X and Y. There is guidance in a situation where X and Y are married. I have not yet determined whether the parties were a de facto couple. It may be that if they were, one would have to adjust one's approach, but for present purposes I will put that matter out of consideration.
44 In the CCH Australian De Facto Relationship Law at para 110 on p 1111 the learned author says:
"Where a de facto couple open a joint bank account with unequal initial and subsequent deposits, it might be argued that the account, and anything purchased from the account, should be owned in proportion to the initial, and perhaps subsequent, deposits. This may open some accounting nightmares which would encourage the courts to find either:
· An objective intention to own the bank account and anything purchased therefrom jointly, eg Jones v Maynard [1951] 1 Ch 572; Pickard v Pickard [1981] FLC 91-034; or
· An objective intention that, at least during overt marital harmony, anything withdrawn from the joint account would normally become the property of the withdrawing spouse, eg Re Bishop [1965] Ch 450; Croton v R (1967) 117 CLR 326.
Which objective intention prevails over the presumption of resulting trust will depend upon judicial speculation from the facts of each case. This is hardly reassuring to would-be litigants given the elusive nature of past intentions in family transactions."
45 I have, of course, read those four cases. With respect, none of them are of much assistance in resolving the present problem. Jones v Maynard was a case involving husband and wife and Vaisey J held that where husband and wife have a joint account one does not take accounts as to whose is what, but divides the proceeds equally at law or in equity. Pickard (also reported as (1981) 7 Fam LR 636) was a decision of Nygh J again involving a married couple. His Honour followed Jones v Maynard.
46 In Re Bishop, Stamp J made it clear that he disapproved of Jones v Maynard and distinguished it in the case before him. However, again this was a case of husband and wife operating a joint account on the terms that either could draw on it and it was held that if one purchased a chattel for his own benefit or made an investment in her own name, then there was no equity to displace the legal ownership.
47 Croton was a case where a married man and a divorced woman formed an association and had a joint bank account upon which either could operate. The man withdrew the money and put it into his own account and he was charged with larceny. The High Court reversed the conviction, but in the course of doing so made observations as to the situation where parties operate a joint account. Barwick CJ said at 334:
"It was a joint account with a right in each to withdraw. Whether or not there was evidence of a legally-binding arrangement as to the ultimate use of the amount standing in it may be doubted: and in default of such an arrangement it may be that either could withdraw the whole or any part without coming under any obligation to account. Whether or not the proceeds of the account were joint property is not answered merely by the fact that, in the circumstances, the account was in the joint names. Further, even supposing such an agreement as to the use of the proceeds of the joint account, it does not follow that it extended to require the amount to be kept in that account: the ability of either to withdraw from the account might be thought to tend against such a construction of these arrangements."