Waterhouse v Power[2003] QCA 155

SUPREME COURT OF QUEENSLAND

[1]  de JERSEY CJ:  The appellant and the respondent lived together in a same-sex relationship for approximately eight years in the 1990's.  When the relationship commenced, the respondent owned a house at Wavell Heights.  The parties lived together in that house.  The appellant has unsuccessfully through these proceedings claimed a one half share in that property.  During their relationship, the parties acquired a property at Chillingham in Northern New South Wales and a four-wheel drive vehicle.  Each of those pieces of property was put into their joint names.  The appellant also unsuccessfully claimed the respondent's interest in that property.  (The Chillingham property had been sold by the time of trial.)

[2] It is important at the outset to note that the learned trial Judge did not accept the appellant as a creditable witness.  The Judge found against her in respect of some major parts of her evidence.  The appellant gave evidence, for example, that the respondent said that she intended to give the appellant a one half share in the Wavell Heights property; and that the appellant and the respondent decided to make wills each leaving everything to the other.  The appellant also claimed in her evidence to have made payments to the respondent's parents by way of repayment of monies earlier advanced to the respondent by her parents to help her purchase the Wavell Heights property.  On those three important matters, the Judge disbelieved the appellant.  He described her evidence "at best for her (as) a reconstruction designed to advance or enhance her case rather than a genuine account of events".  He should be seen as having considered her generally as not a credible witness.

[3] In rejecting the appellant's claim to one half of the Wavell Heights property, the Judge was faced with the appellant's claims that she contributed more than one half the cost of groceries and associated household running expenses.  Even assuming that to be the case – which one could not ultimately do because of the Judge's general rejection of the appellant's evidence, that did not necessarily warrant the conclusion that the extent of the appellant's greater contribution should in equity translate to an interest in the real property.  His Honour found that there was "no nexus between the disparity (assuming that to be the case) and the acquisition, enhancement and retention" of the property, referring to Engwirda v Engwirda & Ors [2000] QCA 61, para 28 and Baumgartner v Baumgartner (1987) 164 CLR 137:  no nexus was, as he said, "pleaded, contended for or established".  The submission as to entitlement was "high on assertion and short on factual basis", to use the Judge's words, especially given His Honour's rejection of the appellant's credibility. 

[4] Parties living together in such circumstances would ordinarily be expected to contribute to meeting the household running expenses.  In this particular case, they were living in the respondent's own house.  The respondent did not charge the appellant rent.  Before the commencement of the relationship, the appellant had lived in rented premises elsewhere.  As the Judge pointed out, the respondent's generosity in that regard may go to explain why the appellant contributed beyond her one half share in other respects.

[5] The Judge accepted that the appellant contributed to the enhancement of the Wavell Heights property.  But there was no evidence to satisfy him that the enhancement increased the value of the property.  There was no valuation evidence on which the Judge could rely establishing the value of the property did in fact increase over the period of the relationship. 

[6] Counsel for the appellant criticized the learned Judge's approach as "requiring" a nexus between contributions made by the appellant, and the retention and maintenance of the Wavell Heights property.  The Judge referred to Engwirda, but it was submitted that should be read as confined to commercial situations. Why is not apparent, and Meehan v Fuller [1999] QCA 37 and Dunne v Turner [1996] QCA 272 would run to the contrary of that submission.  But the Judge has not necessarily proceeded on the basis of any such requirement:  the claim failed primarily because his having rejected the plaintiff's credibility, there was no evidence on which the Judge could have reached even the factual conclusion necessary to activate this issue – that is, that the contributions were disproportionate.

[7] Counsel for the appellant asserted sums aggregating $12,000 were paid to the respondent's parents, who then gave that to the respondent, and that that sum should be brought to account now to the appellant's credit.  In view of the finding as to credit, the submission is untenable:  the Judge must be taken not to have accepted that that overall sum was paid.

[8] Counsel for the appellant also criticized the learned Judge's reference to the significance of disparity between the respective parties' contributions, submitting that Baumgartner, supra pp 149-150, 154-155 "makes it clear that equal contributions will result in equal shares, not the denial of a constructive trust at all…a disparity is not necessary before a constructive trust can be established".  While that may be accepted where persons contribute equally or otherwise to the acquisition of property, it may be different where one party already owns the relevant property, before the contributions to the household etc expenses commence.  Again, however, this aspect of challenge is academic in light of the appellant's failure, as a matter of fact, to establish the extent of her contributions, whether equal to or greater than those of the respondent. 

[9] A broader criticism of His Honour's approach was that he failed to find that the parties entered into a "joint endeavour" to secure their future accommodation and lives together, such as came to embrace all three items of property.  The learned Judge rejected this position, as a matter of fact.  He held: 

"…there were separate and distinct arrangements in respect of each of the Wavell Heights house, the Chillingham property and the four-wheel drive.  There was no overall common purpose or joint endeavour…(I) note that the [respondent] had acquired, maintained and improved the Wavell Heights property prior to the commencement of the relationship.  The shares of the respective parties in the Chillingham property and in the four-wheel drive, both of which were acquired towards the end of the relationship, reflect the specific intentions of the parties (para 13)…The parties maintained separate bank accounts.  During the relationship they opened a joint account to which each contributed and drew on but they appear to have otherwise maintained separate accounts although they were less utilised" (para 14)

[10]  Contending the Judge erred, the appellant relies on an inference of "joint endeavour" to be drawn from the aggregation of a number of features (Warren v Coombes (1979) 142 CLR 531, 537-8).  The Judge clearly took account of a number of them:  that the parties cohabited in a domestic relationship, that the appellant managed the household finances, that the appellant did most of the shopping, and that the Chillingham property and the four-wheel drive vehicle were put into joint names, with repayment on the Chillingham loan jointly secured.  Those features did not oblige the Judge to find a joint endeavour of the character urged for the appellant. 

[11]  In relation to the other matters relied upon by the appellant for that inference, the appellant faces evidentiary problems.  The appellant did not accept she managed the boarders living at the Wavell Heights house (transcript p 50 line 10).  As to whether the parties performed chores to an unequal extent, as claimed, the Judge found that what they did was no more than what one might expect with such a relationship, so for present purposes the appellant's contention is not advanced.  The appellant relied on the establishment of a joint account.  That occurred late in the relationship, but significantly the appellant did not fully use it as such:  she did not, for example, pay her salary into it. 

[12]  I note that Counsel for the appellant did not, at the hearing of the appeal, press further the contention that a 'common endeavour' covering all three pieces of property should have been found.

[13]  The Judge was perfectly entitled to decline to find, as a matter of factual conclusion, that the joint endeavour for which the respondent contended was established on the evidence.

[14]  The appellant made separate submissions in relation to her alleged payments to the respondent's parents, and as to the non-payment of rent.  They were made, however, on the assumption that there should be a finding of joint endeavour.  It is not necessary therefore to consider those submissions further, beyond reconfirming the view that the approach taken to those issues, essentially of a factual complexion, was one reasonably open to His Honour.

[15]  I turn finally to the Chillingham property and the four-wheel drive vehicle.  The Judge held that the joint ownership, evidenced by the registered title and the registration of the vehicle, "reflect(s) the explicit intention of the parties at the time of the acquisition".  The relationship collapsed only a few months after that acquisition.  Counsel for the appellant submitted the Judge should therefore have looked more broadly at the matter, and reliance was placed on Muschinski v Dodds (1984-1985) 160 CLR 583 for the view that a constructive trust can operate irrespectively of the specific intent of the parties.

[16]  The learned Judge dealt with the matter as follows:

"The Chillingham property

As I have already said, this property has been sold and the net proceeds held pending the resolution of this action.  The ownership arrangements reflect the explicit intention of the parties at the time of the acquisition of the property.  That conclusion is an impediment to the relief claimed.  The law will not impute an intention to the contrary of the explicit intention which exists here; Muschinski v Dodds (1984-1985) 160 CLR 503 at 595.  This is not a case where the intention was based on assurances which were not fulfilled, as was the situation in Muschinski.  The intention in the present case presumably reflected a belief that the relationship would continue.

It well may be that the plaintiff contributed more to the funds used to acquire the Chillingham property but the extent of the disparity is, in my view, not determinable without a proper taking of account.  Moreover such a disparity is not, on the view I have of the evidence, necessarily unconscionable so as to found the intervention of this Court.

The motor vehicle

The position with the motor vehicle is comparable to that with respect to the Chillingham property.  The plaintiff may have made a greater financial contribution than the defendant towards the acquisition of the vehicle.  The registration in joint names appears to reflect the explicit intention of the parties.  The extent of the disparity of contributions depends on the proper taking of an account.  The demonstration of a disparity does not, without more, mean that it is unconscionable for the plaintiff to be a joint owner of the property and it does not follow that the relief sought is the appropriate relief in that event."

[17]  That approach, covering both the relevance of the parties' specific intent as at acquisition, and the issue whether respecting that intent would as matters developed (with, for example, the unforeseen breakdown of the relationship), lead to a position of unconscionability, was unexceptionable.  That approach was not inconsistent with Baumgartner, supra, p 148 (and see Muschinski, p 614).

[18]  The appellant's ultimate difficulty is that a taking of accounts was not sought, and so far as she herself gave evidence of contributions, she is burdened, come the disposition of this appeal, by the learned Judge's view that she was not a creditable witness.

[19]  Counsel for the appellant submitted most of the financial contribution to acquisition of Chillingham came from the appellant, and that she paid all the price for the vehicle, so that a constructive trust applies to that property in favour, in its entirety, of the appellant.  Counsel provided, during the hearing of the appeal, a schedule detailing disbursements from what was called the "Viridian" joint account, said to be for those purposes.   The difficulty is that to identify those moneys as coming originally from the appellant, and as having been disbursed for the purpose the appellant argues, the appellant needs to rely on her own evidence – which however the Judge considered not worthy of credit.

[20]  In my view, none of the grounds of appeal has been established.  The appeal should be dismissed, with costs to be assessed.

[21]  WILLIAMS JA:  The broad relevant facts are set out in the reasons for judgment of the Chief Justice which I have had the advantage of reading.  For those reasons I agree that the appellant has not established any basis for upsetting the decision of the learned trial judge with respect to the Wavell Heights property.

[22]  The Chief Justice has set out in his reasons paragraphs from the judgment at first instance dealing with the Chillingham property and the four wheel drive motor vehicle.  It was submitted that the learned trial judge erred in reasoning with respect to those properties because he referred to the fact that the “ownership arrangements reflect the explicit intention of the parties at the time of the acquisition of the property.”  It was said that he erred because a constructive trust can be imposed as a remedial institution in equity regardless of actual or presumed agreement or intention of the parties.  Reference in that regard was made to observations of Deane J in Muschinski v Dodds (1985) 160 CLR 583 at 613-4 and 620-1, and the citation of such passages with approval by Mason CJ, Wilson and Deane JJ in Baumgartner v Baumgartner (1987) 164 CLR 137 especially at 148.

[23]  In the passage from Muschinski at 620 quoted in Baumgartner at 148 the principle is said to operate “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 specifically provided that the other party should so enjoy it.”  That clearly suggests that though the court may impose a constructive trust regardless of the actual intention of the parties, the intention of the parties is not an irrelevant consideration.  On my reading of the passages in Muschinski and Baumgartner referred to, the court should, in the first instance, consider the position in law and equity given the actual intention of the parties.  The conclusion so derived may then be set aside to the extent that enforcing ownership of the property in that way “would be contrary to equitable principle.”  That must mean that the position as to ownership reached by considering the relevant conduct, including the agreement between the parties, was a result evidencing “unconscionable conduct” according to general principles of equity.  The High Court in the passages referred to was also at pains to point out that the imposition of a constructive trust did not involve applying “idiosyncratic notions of what is just and fair” but rather traditional principles of equity.

[24]  Given that the learned trial judge in this case found that the explicit intention of the parties at the time of the acquisition of each of the relevant items of property was that the ownership should be joint, such a disposition of ownership could only be said to offend those relevant principles of equity if there was such a disparity in the contributions as necessarily led to the conclusion that the transaction was unconscionable.

[25]  As pointed out in the reasons of both the learned trial judge and the Chief Justice the evidence did not permit the making of such a finding.

[26]  I agree with the reasons of the Chief Justice.  The appeal should be dismissed with costs to be assessed.

[27]  ATKINSON J:  On 21 December 1999, the Property Law Amendment Act commenced.  That Act amended the Property Law Act 1974 to add Part 19 to facilitate just and equitable property distribution at the end of de facto relationships.  It applies to all de facto relationships other than those that ended before the commencement of the amendments.  A de facto relationship is defined by ss 259-261 to mean a relationship between two persons, whether of the same or opposite sex, who are living or have lived together as a couple, that is, on a genuine domestic basis in a relationship based on intimacy, trust and personal commitment to each other.  This definition fits the relationship between Merrin Waterhouse and Sheridan Power.  However, their relationship ended towards the end of November 1999 and so the property dispute between them cannot be determined under the provisions of Part 19 of the Property Law Act 1974.  Their dispute therefore falls to be determined under the common law and equity as it was before the statutory regime was put in place to simplify the resolution of disputes between former parties to a de facto relationship.[1]

The Wavell Heights property

[28]  The relationship between Ms Waterhouse and Ms Power commenced in 1991.  By the end of that year, Ms Waterhouse had moved into Ms Power’s home at 40 Castor Road, Wavell Heights (“the Wavell Heights property”).  The Wavell Heights property was then and is still owned by Ms Power without any encumbrances.  It was purchased for $57,000.00 in 1987, with $55,000.00 of the purchase price being contributed by Ms Power’s parents and the remainder, together with outgoings associated with the acquisition, contributed by the respondent, Ms Power.  Ms Power had an informal financial arrangement with her parents whereby she was to leave the Wavell Heights property in her will to the benefit of the next generation of family members.  Similar arrangements were made with Ms Power’s siblings.  She also arranged to pay moneys from time to time to her parents which they would accumulate and pay to her in a lump sum for repairs, maintenance or renovations to the Wavell Heights property.

[29]  When Ms Waterhouse moved into the Wavell Heights property, she contributed to some enhancement of the property and at least half of the household’s living expenses. Both Ms Waterhouse and Ms Power also made non-financial contributions to the household.  In keeping with the nature of the relationship, Ms Waterhouse did not pay rent.  Ms Waterhouse gave evidence that in or about June 1992, Ms Power told her that she had decided to give Ms Waterhouse a half share in the Wavell Heights property.  However, the learned trial judge did not accept the evidence given by Ms Waterhouse’s parents of similar statements being made to them.  Evidence given by a third person said to be corroborative was neutral.

[30]  The trial judge did not accept that Ms Waterhouse was a “creditable” witness.  She gave evidence for example that in 1994, she and the respondent decided to make mirror wills leaving their property to each other or, if one pre-deceased the other, to female members of each other’s families.  Ms Waterhouse said that she and Ms Power saw a solicitor, Mr Joe Tooma, together for that purpose.  However, Mr Tooma’s evidence, which was accepted by the learned trial judge, did not support her version.  His evidence showed that Ms Power made a will in 1990 which was consistent with the family arrangement earlier referred to and that Ms Waterhouse made a will in 1994 consistent with the instructions she said she gave except that there were no instructions given for any mirror will to be made on behalf of Ms Power.

[31]  The learned trial judge did not accept the appellant’s evidence that occasional payments, which may have been made by the respondent to the appellant’s parents, were repayments of monies advanced by them for acquisition of the Wavell Heights property.  His Honour was not satisfied that there was any such arrangement to repay monies advanced by Mr and Mrs Power to their daughter for the purchase of the Wavell Heights property.

[32]  Taking all those matters into account, his Honour was not satisfied that any expenditure by Ms Waterhouse was made in reliance on the promise, assuming it was made, by Ms Power to transfer half the title in the Wavell Heights property.  Neither was he satisfied that any expenditure made by Ms Waterhouse had led to an increase in value of the Wavell Heights property.

[33]  His Honour held that Ms Waterhouse had not established any basis for a half share, as she claimed, in the Wavell Heights property.  That is a view with which I respectfully agree. 

The later acquired property

[34]  The appellant also claimed an equitable entitlement to two items of property which were acquired during the relationship.  In 1999, only five months before the relationship broke down, the parties acquired a house on a rural property at Chillingham in New South Wales (“the Chillingham property”) and,  a month later, a four-wheel drive utility.  Both were purchased in joint names, which the learned trial judge found, reflected the parties’ specific intention.  In the action, the appellant claimed an entitlement in equity to the half share owned by the respondent.

[35]  The basis for this claim was the unequal financial contributions made by each party.  The learned trial judge did not make findings as to the respective contributions beyond observing that “it well may be that the plaintiff contributed more to the funds used to acquire the Chillingham property” and “the plaintiff may have made a greater financial contribution than the defendant towards the acquisition of the vehicle”.  His Honour said, however, that the extent of the disparity was not determinable without a proper taking of account which had not been amongst the relief sought.  His Honour held that it could not be said that any disparity of contribution would mean that it would be unconscionable for the plaintiff to assert her joint ownership of the Chillingham property and the four-wheel drive utility. 

[36]  The ownership arrangements reflected the intention of the parties at the time of acquisition of the property and the learned trial judge held that the law would not impute an intention to the contrary of such explicit intention.  His Honour relied as authority for this proposition on the judgment of Gibbs CJ in Muschinski v Dodds (1985) 160 CLR 583 at 595 where the Chief Justice held:

“Notwithstanding the remarks of Lord Reid in Gissing v Gissing [1971] AC 886 at 897, I am unable to accept that the law can permit an intention to be imputed to parties when the evidence shows that they had in fact formed a different intention”.

The Chief Justice held that as the parties had formed a common intention to hold the property as tenants in common as to equal shares, this could not be changed by imposition of a constructive trust. 

[37]  However, in Muschinski v Dodds at 614, Deane J held that a constructive trust may be imposed, regardless of the intention of the parties.  As his Honour held:

“… the constructive trust can properly be described as a remedial institution which equity imposes regardless of actual or presumed agreement or intention (and subsequently protects) to preclude the retention or assertion of beneficial ownership of property to the extent that such retention or assertion would be contrary to equitable principle”.

It is this statement of the law rather than that of Gibbs CJ which has been followed and which is therefore binding in this case.

[38]  In Muschinski v Dodds, Mason J agreed with the judgment of Deane J.[2]   Gibbs CJ, while coming to the same result as Mason and Deane JJ, came to that conclusion by different reasoning.  As already noted, his Honour expressed the view, contrary to that expressed by Mason and Deane JJ, that the court would give effect to the common intention of the parties and not impose a constructive trust but require the party who had not paid his share to make an equal contribution to the purchase price.  Mrs Muschinski was entitled to a contribution from Mr Dodds to the extent that she paid more than one half of the purchase moneys of the property bought in joint names.  She was entitled to an equitable charge over the respondent’s half interest for such an amount.[3]

[39]  The reasoning of Mason and Deane JJ was followed by the High Court in Baumgartner v Baumgartner (1987) 164 CLR 137 particularly at 148 where Mason, Wilson and Deane JJ, after referring to the passage quoted above from the judgment of Deane J in Muschinski v Dodds at 614, held:

“His Honour pointed out that the constructive trust serves as a remedy which equity imposes regardless of actual or presumed agreement or intention “to preclude the retention or assertion of beneficial ownership of property to the extent that such retention or assertion would be contrary to equitable principle” (1985) 160 CLR at 614: see also at p. 617.  In rejecting the notion that a constructive trust will be imposed in accordance with idiosyncratic notions of what is just and fair his Honour acknowledged that general notions of fairness and justice are relevant to the traditional concept of unconscionable conduct, this being a concept which underlies fundamental equitable concepts and doctrines, including the constructive trust (1985) 160 CLR at 616”.

[40]  That principle has been applied in this court[4] in Dunne v Turner[5] where Pincus JA observed[6] that:

“It is clear from the principal judgment in Baumgartner that a trust may be imposed “regardless of actual or presumed agreement or intention”.” 

McPherson JA agreed:[7]

“Recent decisions of the High Court have established that, when an enduring joint relationship between a man and a woman[8] comes to an end, their respective rights in and to property do not, or do not necessarily, fall to be determined according to strict legal entitlement.  Ownership at law may be qualified by the equitable remedy of a constructive trust, which may be imposed “regardless of actual or presumed agreement or intention” on the part of those concerned.  See Baumgartner v Baumgartner (1987) 164 CLR 137 at 148 (Mason CJ, Wilson and Deane JJ.)”[9]

[41]  The factual circumstances of Muschinski v Dodds bear some similarities to the present case.  In Muschinskiv Dodds, Mrs Muschinski and Mr Dodds, who had been living together in a de facto relationship for three years, decided to purchase land and a cottage together at Picton (“the Picton property”).  Mrs Muschinski paid the whole of the purchase price and Mr Dodds’ financial contribution was to be made subsequently.  The parties’ intention was to hold the Picton property as tenants in common in equal shares.  However, the de facto relationship between them came to an end after only some expenditure on the property, other than the purchase price, had been incurred.  Mrs Muschinski had contributed approximately ten-elevenths of the overall expenditure, while Mr Dodds had contributed one-eleventh.

[42]  In this case, as in Muschinski v Dodds,  there was uncontroverted evidence from the appellant that she had paid the deposit of $18,000.00 for the Chillingham property from her personal savings account.  The rest of the purchase price of $180,000.00 for the Chillingham property was paid from a loan of $135,000.00 from the Colonial State Bank to Ms Waterhouse and Ms Power and from moneys held in a joint account which had come from an early payment of superannuation moneys to Ms Waterhouse.  There were no explicit findings about these matters because of the view his Honour took of the mutual intention of the parties.  Subsequently, both parties made various relatively minor financial and non-financial contributions both before and after the breakdown of the de facto relationship.  The Chillingham property has been sold and after the payment of expenses approximately $30,000.00 remained for distribution.

[43]  So far as the four-wheel drive utility is concerned, the uncontroverted evidence suggested that the whole of the purchase price had come from the superannuation payment made to the appellant.  Because of his Honour’s view of the primacy of the common intention of the parties, there was no explicit finding made by the learned trial judge as to the source of the moneys used to acquire the four-wheel drive utility.  Certainly the learned trial judge found that the appellant was generally not a “creditable” witness but the appellant’s evidence[10] as to her financial contribution to the acquisition of the Chillingham property and the four-wheel drive utility, on which she was not cross-examined, was supported by documentary evidence.[11]  It is not obvious that the appellant’s evidence on these matters would not have been, or should not be, accepted.

[44]  As in Muschinski v Dodds, there was no express or implied agreement, arrangement or understanding between the parties that they should hold their legal interests upon trust for themselves in shares corresponding to their respective contributions.  As Deane J held[12] in words which apply equally to the present case:

“To the contrary, the evidence leads inexorably to the conclusion – expressed in concurrent findings of fact in the courts below – that it was their shared intention that, from the time of purchase, each should have a full one-half beneficial, as well as legal, interest in the property.”

[45]  There could not, in those circumstances, be any recourse to the presumption of the law of equity that, where two or more persons advance the purchase price of the property in different shares, the person or persons to whom the legal title is transferred holds or hold the property upon resulting trust in favour of the persons who provided the purchase price in proportion to the respective amounts provided.[13]  That presumption operates by reference to the presumed intention of the party whose contribution exceeds his or her proportionate share.  Such a presumption cannot prevail over the actual intention of that party as established by the overall evidence, including the evidence of the parties’ respective contributions.[14]  In Muschinski v Dodds, no relief was therefore available to Mrs Muschinski on the grounds of breach of express or implied agreement or of express or implied trust. 

[46]  However, the circumstances of that case were such as to entitle Mrs Muschinski, as the party making the greater contribution, to claim relief by way of the declaration or imposition of a constructive trust.  Such a trust differs from other forms of trust because, unlike an express or implied trust, it arises regardless of the intention of the parties. The common intention of the parties was based on the expected continuation of the relationship between them.  In those circumstances, Deane J observed[15] that:

“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 specifically provided that that other party should so enjoy it…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”.[16]

[47]  In determining what constitutes unconscionable conduct, one is not left “at large to indulge random notions of what is fair and just as a matter of abstract morality”[17].  In this case, as in Muschinski v Dodds, the conduct which has an unconscionable character is the respondent’s conduct in seeking to assert and retain the benefit of a full one-half interest in the property without making any allowance for the fact that the appellant contributed a disproportionate amount of the cost of its purchase[18], where, as here, no arrangement had been made between the parties as to what should happen in the unforeseen circumstances of the collapse of the relationship.  There is a need to call in aid the principle of equity applicable to preclude the unconscionable assertion of legal rights in this class of case, just as in MuschinskivDodds it was held that “equity requires that the rights and obligations of the parties be adjusted to compensate for the disproportion between their contributions to the purchase and improvement of the Picton property”[19]. 

[48]  It follows that applying the law as stated by Deane J in Muschinski v Dodds, a constructive trust should be imposed, in this case as it was there, so that notwithstanding the parties’ intention to share ownership of the property equally, the parties should be proportionately repaid their respective contributions to the property acquired during the relationship to the extent allowed by the proceeds of any sale.[20]  In this case, that would exhaust all the moneys which are available.  In such a situation there should be an order declaring that the Chillingham property and the four-wheel drive is held by the appellant and the respondent upon constructive trust, and that the respective legal interests are held on trust to repay to each their respective contribution.  The matter should be remitted to the trial division for findings as to the respective contributions.  It is not necessary, as Dunne v Turner shows, for accounts to be taken.  The proper apportionment is not a matter of precise calculation.  The matter could alternatively be stood over to allow the parties to agree upon orders that would dispose of this case without further expense.

Orders

1.Appeal allowed in part.

2.Remit to the learned trial judge for determination of the respective contributions of the appellant and respondent to the acquisition of the Chillingham property and the four-wheel drive utility.

3.The respondent should pay half the appellant’s costs of the appeal.