In the case of Jabara & Gaber [2022] FedCFamC2F 1527, Judge Street declared that the applicant holds the property on resulting trust for her mother and held that:

This matter was fixed for a property hearing on 2 November 2022. The applicant father joined his wife as first respondent and his mother as second respondent. On 9 December 2021, the second respondent filed an application seeking a declaration that the applicant held a property being B Street, Suburb C, New South Wales, in folio ..., identifier ... (the Property) on trust for the second respondent.

The first respondent submitted that the making of a will by the applicant in 2001 should be regarded by the Court as consistent with the property in fact being beneficially owned by the applicant. Additionally, the first respondent, suggested that the evidence in relation to the source of the funds, to the extent accepted without contest as coming from the second respondent, was not one where the presumption of advancement had been rebutted.

The second respondent deposed to the fact that she asked the applicant to ensure that he made a will that provided for the property to pass to the applicant’s estate and to the applicant’s five siblings in equal shares in case something happened to the second respondent. The second respondent identified that she paid the full purchase price for the property and paid the stamp duty and associated costs and has always paid the council rates, insurance premiums since she purchased the property.

The Will corroborates the existence of the intention by the second respondent at the time of transfer other than supportive of the presumption of advancement. A further affidavit of the second respondent, dated 9 December 2021, identified that the property had never been rented and is being occupied by different family members over different time periods.

The applicant’s affidavit, dated 12 May 2021, identified that he was the registered proprietor and did not contribute any money to the purchase of the property and that the purchase price as well as stamp duty was paid by the second respondent.

In the affidavit dated 12 May 2021, the applicant deposes to the fact that the second respondent’s affidavit sets out the circumstances as to the acquisition of that property and the applicant relies on her evidence. The applicant asserted that he considered that he holds the property for his mother who has stated that she intends the property ultimately to pass in equal shares to her six children, one of whom is the applicant.

The applicant identified that as requested by his mother he made a Will dated 2001 in which he left the property in equal shares to his five siblings and to, his wife, Ms Jabara in equal shares.

There was no dispute as to the legal principles and that there is a presumption in the present case that the transferee, being the applicant, holds the property on trust consistent with the decision in Napier v Public Trustee (WA) [1926] ArgusLawRp 12; (1980) 32 ALR 133 at 158.

The law with respect to resulting trusts is not in doubt. Where property is transferred by one person into the name of another without consideration, and where a purchaser pays the vendor and directs him to transfer the property into the name of another person without consideration passing from that person, there is a presumption that the transferee holds the property upon trust for the transferor or the purchaser as the case may be. This proposition is subject to the exception that in the case of transfers to a wife or a child (including someone with respect to whom the transferor or purchaser stands in loco parentis) there is a presumption of advancement so that the beneficial as well as the legal interest will pass. Each of the presumptions may be rebutted with evidence.

The Court was also taken to the observations by the learned Deane J in Calverley v Green (1984) 155 242 at 266-267 relevantly as follows:

There are three presumptions of equity which are here relevant, it is: where a person pays the purchase price of property and causes it to be transferred to another or to another and himself jointly, the property is presumed to be held by the transferee or transferees upon trust for the person who provided the purchase money. The second can properly be seen as complementary of the first. It is: where two or more persons advance the purchase price of property in different shares, it is presumed that the person or persons to whom the legal title is transferred holds or hold the property upon resulting trust in favour of those who provided the purchase price in the shares in which they provided it. 

The principles were also identified relevantly by Gleeson CJ of the Supreme Court of New South Wales as he then was in Brown v Brown (1993) 31 NSWLR 582 at 588(c)-589(e).

The equitable presumption can be rebutted or qualified in a given case by evidence of a contrary intention common to the contributors of the purchase price (Calverley v Green, per Mason and Brennan JJ at 261).

The only issue in the present case is whether the presumption of advancement is rebutted. The unchallenged evidence of the second respondent is that she was placing the property into the name of the applicant, not that she was giving the property to the applicant or that she was intending to transfer the whole of the beneficial interest in the property to the applicant. 

The identified conditions, limited purpose, and reference only to name, reflect an intention of the second respondent not to confer full beneficial interest on the applicant and are in the present case sufficient to rebut the presumption of advancement as between the second respondent mother and applicant child.

When the evidence is taken as a whole, in that regard, it is apparent that the second respondent did not intend the applicant to hold the property other than in name. The whole of the source of funds came from the second respondent in the acquisition of the property and the differing family members occupying the property are consistent with the property in fact being that of the second respondent. The meeting of the outgoings by the second respondent is consistent with the existence of that resulting trust.

The argument that the 2001 will should be treated as evidencing a beneficial interest of the whole estate being held by the applicant is unpersuasive. The Will is not the act or accurate expressed intent of the second respondent. The Will is entirely consistent with the second respondent having made clear the intention that the property was not being transferred beneficially to the applicant and the steps taken in creating the Will purportedly consistent with the requirement of conditions imposed by the second respondent reflects, in this case, a rebuttal of the presumption of advancement. Is for these reasons that the Court made the declaration in favour of the second respondent in the present case.

Please feel free to contact Longton Legal who have expertise in dealing with trust issues in Family Law matters. 

*Disclaimer: This is intended as general information only and not to be construed as legal advice. The above information is subject to changes over time. You should always seek professional advice before taking any course of action.*