The Public Trustee of Queensland v Ban (No 2)
[2012] QSC 97
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- Unreported Judgment
- The Public Trustee of Queensland v Ban (No 2)[2012] QSC 97
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The Public Trustee of Queensland v Ban (No 2)[2012] QSC 97
The Public Trustee of Queensland v Ban (No 2)[2012] QSC 97
SUPREME COURT OF QUEENSLAND
CITATION: | The Public Trustee of Queensland (as Litigation Guardian for ADF) v Ban (No 2) [2012] QSC 97 |
PARTIES: | THE PUBLIC TRUSTEE OF QUEENSLAND (AS LITIGATION GUARDIAN FOR ADF) v HAJNAL DAHLIA BAN and SEAN BLACK |
FILE NO/S: | BS 13246 of 2010 |
DIVISION: | Trial Division |
PROCEEDING: | Hearing |
ORIGINATING COURT: | Supreme Court of Queensland |
DELIVERED ON: | 19 April 2012 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 29 March 2012 |
JUDGE: | Boddice J |
ORDER: |
|
CATCHWORDS: | GIFTS – GIFTS INTER VIVOS – ESSENTIALS OF PERFECT GIFTS – GIFTS OF LAND OR INTERESTS THEREIN – where the registered proprietor of property executed by way of gift an instrument of transfer of his interest in real property to himself and the first defendant jointly – where the first defendant alleges the property is held by the registered proprietor beneficially for himself and the first defendant – where it is accepted the proprietor intended the transfer operate as a gift – where the executed instrument of transfer was never registered – whether the registered proprietor took all necessary steps to perfect the gift REAL PROPERTY – TORRENS TITLE – UNREGISTERED INTERESTS – UNREGISTERED INSTRUMENTS – UNREGISTERED VOLUNTARY TRANSFER – whether the registered proprietor took all necessary steps to perfect the gift Corin v Patton (1990) 169 CLR 540 Costin v Costin (1997) NSW ConvR 55-811 Milroy v Lord (1862) 4 De GF & J 264; (1862) 45 ER 1185; [1861-73] All ER Rep 783 |
COUNSEL: | AP Collins for the plaintiff The first defendant appeared on her own behalf |
SOLICITORS: | Official Solicitor to the Public Trustee for the plaintiff The first defendant appeared on her own behalf |
- ADF is the registered proprietor of real property at 468 Tully Road, Greenbank in the State of Queensland (“the Greenbank property”). On 28 August 2009, he executed an instrument of transfer of his interest in the property to himself and the first defendant jointly. The first defendant alleges this transfer, which has never been registered, was executed by way of a gift, and that the Greenbank property is now held by ADF beneficially for the first defendant and ADF.
- The Public Trustee of Queensland, as ADF’s Litigation Guardian, seeks a determination, as a separate question, whether the Greenbank property is held by ADF on trust beneficially for ADF and the first defendant as joint tenants. The issue for determination is not whether ADF had the requisite capacity to execute the instrument of transfer, or whether ADF intended the transfer to be a gift to the first defendant. For the purposes of the determination of the separate question, the Public Trustee accepts ADF had the requisite capacity, and intended the transfer operate as a gift to the first defendant. The issue for determination is whether ADF had taken all necessary steps to perfect the gift of the Greenbank property to the first defendant and himself as joint tenants.
Background
- ADF is 67 years of age. He was formerly a barrister at law. The first defendant and ADF are close friends. They have known each other for over 10 years. He mentored her in her legal studies, and assisted her in her political career.
- On 28 April 2009, ADF executed an enduring power of attorney (“the EPA”) appointing the first defendant as his attorney for financial and personal matters, including health matters. That power of attorney took effect immediately.
- Subsequent to the execution of the EPA, the health of ADF deteriorated significantly. He was later diagnosed with dementia. He now needs full time care and resides in an aged care facility.
- On 2 July 2010, the Public Trustee was appointed as administrator for ADF for all financial matters. The Adult Guardian was appointed guardian for ADF for all personal matters. On the same day, the first defendant was given leave to resign as attorney for ADF under the EPA.
The transfer
- The instrument of transfer was prepared by a solicitor, John Campbell Walker. ADF executed the transfer in Mr Walker’s presence on 27 August 2009. His signature was witnessed by one of Mr Walker’s employees. The first defendant also executed the transfer on 27 August 2009. Her signature was witnessed by a Justice of the Peace. The executed transfer was returned to Mr Walker. He retained it on file.
Evidence
- Mr Walker first met ADF in or about late July 2009. He had been asked by another person to act on ADF’s behalf in the sale of a property at Park Ridge.
- Mr Walker gave evidence that in early August 2009, ADF gave instructions that he wished to transfer a half interest in the Greenbank property to the first defendant. ADF stated he had been disowned by his family, and wanted to ensure the first defendant received that property. Mr Walker was concerned about a possible challenge to the proposed transfer. He obtained ADF’s instructions to obtain a certificate of competence from his general practitioner, Dr Sutch.
- By letter dated 26 August 2009, Mr Walker wrote to ADF:
“Dear Sir
YOU TO HAJNAL BAN
Property at: 468 Tully Road, Greenbank
We confirm your instructions received on Saturday, 15 August, 2009 that you require us to attend to the transfer of your interest in the above property to yourself and Hajnal Ban, effectively a gift to Hajnal Ban of a half interest in the property.
We have searched and ascertained that the property is subject to an Easement of Right of Way and we enclose a copy of the Grant of Easement and a copy of the Easement Plan showing Easement A in RP172390 County of Stanley, Parish of Bundamba. No doubt you are aware of the existence of the easement but we draw it to your attention in any event.
We note from the search that a paper title has issued for this property and it should be lodged with the Transfer when registration is to occur.
We confirm that the Transfer should be stamped. In order to establish the stamp duty payable you should provide us with an appraisal by a Real Estate Agent giving not less than two comparable sales as the basis for establishing the value.
As it is inappropriate that we act for Hajnal Ban we will be handing the Transfer to her as it is required to be signed by her as a Transferee and inviting her to obtain independent legal advice before signing the Transfer.”
- By letter of the same date, Mr Walker wrote to Dr Sutch, seeking a certificate as to ADF’s competency or otherwise.
- On 4 September 2009, Mr Walker wrote to ADF confirming that ADF had signed the transfer on 27 August 2009, as had the first defendant, and that Mr Walker held that transfer. Mr Walker also confirmed he had, in accordance with ADF’s instructions, requested a certificate of competency. Mr Walker asked for a bank cheque payable to the Office of State Revenue for $7,350 in payment of the stamp duty. Mr Walker received those moneys from the first defendant.
- On 24 September 2009, Mr Walker wrote to ADF confirming he was “retaining the transfer until we have received Dr Sutch’s certificate”. As no certificate was received, Mr Walker sent a further letter to Dr Sutch dated 15 October 2009. He requested the certificate of competency, as a matter of some urgency. No certificate of competency was ever received in response to that letter.
- Mr Walker continued to retain the executed transfer on file. He did not arrange for it to be stamped, and did not attempt to register that transfer. Mr Walker said he did not ever receive instructions from ADF to lodge the executed transfer for registration. Mr Walker also never received the paper title for the Greenbank property, despite having advised, in his letter to ADF dated 26 August 2009, that it would need to be lodged when registering the transfer.
- On 25 May 2010, Mr Walker received correspondence from Campbells Legal Services. They enclosed an authority, signed by the first defendant as ADF’s attorney, requesting he forward all original files held by him in respect of ADF to them. On 27 May 2010, Mr Walker forwarded the original files to Campbells Legal Services. Those files included the original executed instrument of transfer.
- Jennifer Waldon, the Acting Deputy Official Solicitor to the Public Trustee, has had carriage of ADF’s affairs since the Public Trustee’s appointment as ADF’s administrator. She gave evidence that the Public Trustee’s search of ownership of the Greenbank property revealed it was registered in ADF’s name, and that there was a Certificate of Title. The Public Trustee wrote to the first defendant’s solicitors requesting the Certificate of Title to the Greenbank property. No reply was received to that letter. However, during inspection of documents provided by the first defendant’s solicitors, the original Certificate of Title to the Greenbank property was located in a pile of documents containing personal and financial material relating to ADF. The original Certificate of Title was located in a plastic sleeve which was contained in a manila folder in a suspended filing system. The plastic sleeve also contained ADF’s birth certificate.[1]
Submissions
- The Public Trustee contends that whilst it was ADF’s intention to effect a transfer of his interest in the Greenbank property to himself and the first defendant jointly, ADF did not take sufficient steps to effect the gift of this interest to the first defendant. The Public Trustee contends the following steps were not completed before ADF lost capacity:
- the transfer was not stamped;
- ADF did not give authority to his lawyers to deliver the transfer to the first defendant for registration;
- the transfer was not delivered to the first defendant;
- the Certificate of Title was not given to or delivered to the first defendant;
- the transfer and Certificate of Title were not lodged for registration.
- The first defendant contends that all necessary steps to effect a gift of the property in accordance with ADF’s intention were taken by ADF. The first defendant contends that she, as ADF’s duly authorised attorney, could at any time have given instructions to stamp the document and lodge it for registration. She also contends ADF had given to her the Certificate of Title.
Legal Principles
- To effect a gift, a party must do everything which, according to the nature of the property, is necessary to be done in order to transfer the property and render the gift binding on the donor.[2]
“… The principle is that, if an intending donor of property has done everything which it is necessary for him to have done to effect a transfer of legal title, then equity will recognize the gift. So long as the donee has been equipped to achieve the transfer of legal ownership, the gift is complete in equity. ‘Necessary’ used in this sense means necessary to effect a transfer. From the viewpoint of the intending donor, the question is whether what he has done is sufficient to enable the legal transfer to be effected without further action on his part.”
- In Corin, Deane J specifically dealt with the test for determining whether the stage had been reached when a gift of real property under an unregistered memorandum of transfer is complete and effective in equity. That test is a twofold test:
“It is whether the donor has done all that is necessary to place the vesting of the legal title within the control of the donee and beyond the recall or intervention of the donor. Once that stage is reached and the gift is complete and effective in equity, the equitable interest in the land vests in the donee and, that being so, the donor is bound in conscience to hold the property as trustee for the donee pending the vesting of the legal title.”[5]
Findings
- I found Mr Walker’s evidence credible and reliable. It was consistent with the contents of the contemporaneously made correspondence he sent to ADF and Dr Sutch. I accept ADF gave instructions to Mr Walker to retain the executed instrument of transfer pending receipt of a certificate of competency. I accept ADF never gave Mr Walker instructions to lodge the transfer for registration. I also accept ADF never provided the Certificate of Title to Mr Walker, despite a request that he do so.
- Those findings lead to one conclusion. Whilst ADF intended the first defendant to have a joint interest in the Greenbank property by way of gift, and ADF executed the instrument of transfer, ADF had not done all that was necessary to place the vesting of the legal title within the control of the first defendant and beyond his recall or intervention.[6] ADF left the executed instrument of transfer in the custody of his solicitor. He never gave possession of it to the first defendant, or instructed his solicitor to do so. Whilst the first defendant’s solicitors obtained possession of the executed instrument of transfer in May 2010, that was as a consequence of instructions given by the first defendant in her capacity as ADF’s attorney. The first defendant never had possession of the instrument of transfer in her own right.
- ADF also retained control of the Certificate of Title to the Greenbank property. ADF may have provided documents to the first defendant for safe keeping, including the Certificate of Title to the Greenbank property, but he did not give her possession of the Certificate of Title to enable registration of the transfer. When the Certificate of Title was discovered by the Public Trustee, during inspection of disclosed documents provided by the first defendant’s solicitors, it was found with ADF’s birth certificate in a plastic sleeve in a box of ADF’s personal and financial papers. Having regard to that location, I am satisfied ADF retained control of that Certificate of Title. I do not accept the first defendant had possession of the Certificate of Title in her own right. Its location, with other personal documents, is inconsistent with the first defendant having possession of it for the purpose of enabling the first defendant to register the executed transfer.
- The first defendant contends she, as ADF’s attorney, could at any time have given instructions to register the transfer. Even if that be so, and leaving aside the question of a conflict transaction having regard to her position as both beneficiary of the transfer, and attorney of the donor, the first defendant did not at any time give such instructions. The first defendant submitted she had no duty to exercise her authority as attorney. Whether that be correct is unnecessary to determine as the first defendant accepts she did not ever give those instructions.
- The first defendant also contended a distinction needed to be drawn in the present case as her authority as attorney was a power, not a trust. It is unnecessary to determine the correctness of that submission as the defendant did not ever purport to exercise her authority as attorney to effect registration of this transfer. At no stage did the first defendant, as ADF’s attorney, give instructions to have the transfer registered, or to produce the Certificate of Title to allow registration of the transfer.
- Significantly, the first defendant’s submissions in this respect accept that any instructions given by her to have the transfer registered would have been given by her in her capacity as attorney, not as donee. Acceptance that further instructions were required to effect registration of the executed transfer confirms there remained necessary steps to be undertaken by ADF to perfect the gift of the interest in the Greenbank property to the first defendant.
- Finally, the first defendant contended she was entitled to the interest in the Greenbank property on the basis of proprietary estoppel. The first defendant accepts no such plea has been made by her to date. She contends she intends to do so, and submits the fact no plea had been made to date did not prevent reliance upon proprietary estoppel. There is no substance in this contention. Proprietary estoppel applies in specific circumstances. In essence, it requires that a representation be made to another, who acts to his detriment in reliance upon it. Those circumstances are not established in the present case.
- The first defendant also contended the Public Trustee had administered ADF’s financial affairs in breach of trust, including not meeting obligations to her as a beneficiary when seeking to sell the Greenbank property. The first defendant sought to further advance this argument in supplementary submissions delivered after the hearing. The first defendant had only been granted leave to provide the citations of cases relied upon by her at the hearing of the application. The Public Trustee did not consent to leave being granted to the provision of the further submissions. Accordingly, leave to rely on these submissions was not granted.
- Whether the Public Trustee satisfied its obligations as administrator, including any obligation to any beneficiaries when attempting to sell the Greenbank Property, is irrelevant to the issue to be determined by me as a separate determination. There is no unfairness to the first defendant, in those circumstances, in leave not having been given to rely on those further submissions.
Conclusion
- Whilst ADF intended to give the first defendant a joint interest in the Greenbank property, ADF did not take all necessary steps to perfect a gift of the Greenbank property to the first defendant in equity. The first defendant was unable to effect registration without further instructions by ADF. The vesting of legal title was therefore not within the control of the first defendant. It remained within ADF’s control, and subject to his recall or intervention. In this respect the observations of Brownie AJA, with whom Powell JA agreed, in Costin v Costin[7] are apposite:
“… the donor had not done all that was necessary to render the gift binding upon himself, or to arm or equip the donee with the means of securing registration of the transfer, or of putting the transfer beyond the donor’s recall or intervention.”
- The separate question is answered as follows:
“The plaintiff does not hold the Greenbank property on trust beneficially for ADF and the first defendant as joint tenants as ADF had not taken all necessary steps to effect the transfer of title to ADF and the first defendant as joint tenants.”
- I shall hear the parties as to the form of orders, and costs.