Memik v Taylor

1. [1]

   By a Statement of Claim (“SOC”) filed on 13 August 2024, Cengiz Memik and Susan Memik (“the plaintiffs”) bought a claim seeking vacant possession of the property at 26 Brian Street, Balgownie NSW 2519, being the whole of the land in title reference 69/193312 (“the property”) from Marilyn Anne Taylor (“the defendant”).

2. [2]

   The defendant and her son, Mitchell Dellapina (“Mr Dellapina”), were formerly the registered proprietors of the property. On 10 October 2018, the defendant and Mr Dellapina (“the vendors”) entered into a contract with the plaintiffs for the sale of the property (“the contract for sale”). On that same day, the defendant entered into a deed of life estate with the plaintiffs (“the Deed”), which granted the defendant a life estate in the property and the improvements located within the property, subject to and conditional upon:

   1. (1)

      the defendant regularly maintaining the property and improvements (“the maintenance condition”);

   2. (2)

      the defendant keeping the property and improvements insured for building replacement value and public liability in the sum of $20,000,000 (“the insurance condition”),

3. [3]

   Upon settlement of the contract for sale on 21 November 2018, the plaintiffs became the registered proprietors of the property, and the Deed became binding.

4. [4]

   In late 2023, the plaintiffs claimed that the defendant was in default of the Deed by reason of her failure to comply with the conditions or rectify that default upon notice. The plaintiffs served a notice of termination on the defendant on 16 July 2024 (“the termination notice”), advising the defendant to vacate the property on or before 2 August 2024.

5. [5]

   The defendant continues to occupy the property on the basis that the termination notice was invalid and did not put an end to her interest in the property under the Deed.

6. [6]

   While the plaintiffs were self-represented on the day of the hearing, the affidavit evidence which was tendered and relied on by the plaintiffs was prepared at a time when they were legally represented. No further testimonial evidence was adduced by the plaintiffs at hearing.

7. [7]

   The issues for determination by the Court were outlined in an Agreed Statement of Issues (“ASOI”) prepared by the parties on 4 April 2025 pursuant to orders made by Justice Campbell. That document was also prepared at a time when the plaintiffs were legally represented. The ASOI recorded the issues in the proceedings and identified the position of each party in respect of those issues.

8. [8]

   The ASOI also included a table setting out the plaintiffs’ particulars of breach and the respective position of each party with respect to those particulars (“the table”). The table variously refers to evidence.

9. [9]

   The evidence for the plaintiffs, in that respect, was:

   1. (1)

      an affidavit of Mr Memik filed 14 November 2024 (including Exhibit CM-1 to that affidavit);

   2. (2)

      an affidavit of Mr Memik filed 10 March 2025; and

   3. (3)

      an affidavit of Ismail Memik filed 14 November 2024.

10. [10]

    The evidence of the defendant was an affidavit of the defendant filed 12 February 2025 (including Exhibit MT-1 to that affidavit).

11. [11]

    It may be noted for present purposes, that, having closely considered Mr Memik’s evidence, the Court will find him to be an unsatisfactory witness.

12. [12]

    The issues for the determination by the Court, as set out in the ASOI, were as follows:

13. [13]

    The hearing proceeded on the basis that the plaintiffs adopted and relied on their submissions in the ASOI and the short outline of written submissions filed 5 September 2025. They did not make any oral submissions at hearing.

14. [14]

    I will address each of the issues for determination seriatim below, with the exception of the question of consideration for the sale of the property, which is only relevant in so far as the Court comes to consider relief against forfeiture.

OVERVIEW OF THE DEED

1. [15]

   It was common ground between the parties that the deed of life estate annexed to the contract for sale differed from the Deed which was executed by the parties. The deed of life estate annexed to the contract for sale included an obligation on the defendant to pay any outgoings. However, the Deed (which was executed) provided that any outgoings were to be paid by the plaintiffs. Both parties accepted that the valid contract between them was the version of the deed which had been executed by the parties.

2. [16]

   Recital B of the Deed provided that it is was essential term of the contract for sale that on completion of the contract for sale, the defendant would be granted an equitable life estate in the property.

3. [17]

   The relevant definitions of the Deed, set out in cl 1.1, are as follows:

4. [18]

   Clause 2.1 of the Deed stated:

5. [19]

   The conditions of the life estate are contained in cl 2.2 of the Deed, as follows:

6. [20]

   Clause 2.2A of the Deed provided:

7. [21]

   Clause 2.3 of the Deed related to the potential development of the property by the plaintiffs, and relevantly stated:

8. [22]

   Clause 2.5 of the Deed was the termination clause, which relevantly provided:

9. [23]

   Clause 3 of the Deed provided:

10. [24]

    Clause 5.3 of the Deed contained an entire agreement clause, as follows:

RELEVANT PROVISIONS UNDER THE REAL PROPERTY ACT

1. [25]

   The parties referred to the following sections of the Real Property Act 1900 (NSW) (“the Real Property Act”), as will be referred to later in this judgment:

Facts which were undisputed

1. [26]

   Having regard to the evidence given by both parties, the following facts were undisputed.

2. [27]

   The vendors were the registered proprietors of the property prior to 21 November 2018 and held their interest in the property as tenants in common. The defendant owned a 95% share of the property and Mr Dellapina owned a 5% share of the property.

3. [28]

   The plaintiffs have lived across the road from the property for 20 years. At some date prior to 2010, Mr Memik expressed an interest in purchasing the property, which, at that stage, was owned by the defendant’s mother. In 2018, the defendant approached Mr Memik to enquire if he would be interested in purchasing the property.

4. [29]

   On 10 October 2018, the contract for sale and the Deed were executed by the parties and, in respect of the contract for sale only, Mr Dellapina.

5. [30]

   The contract for sale listed the purchase price as $600,000, with a deposit of $60,000 and balance of $540,000 to be paid. A deposit of $30,000 was paid by the plaintiffs on 10 October 2018, pursuant to a special condition in the contract for sale which permitted that only 5% of the purchase price needed to be paid at the time of exchange.

6. [31]

   The contract for sale contained a number of “special conditions”, including, inter alia, the following clause:

7. [32]

   The total consideration for the transfer of the property, including whether the Deed formed part of that consideration, is a question which is in issue between the parties. I will address that issue later in this judgment.

8. [33]

   The contract for sale settled on 21 November 2018, and legal title to the property passed from the vendors to the plaintiffs (“settlement”). The plaintiffs became the registered proprietors of the property as joint tenants. On that same day, the Deed became binding as between the plaintiffs and the defendant.

9. [34]

   On 24 April 2023, Mr Memik sent a letter to the defendant requesting payments for council and water rates from 2019 to 2023. The total amount claimed to be owed by the defendant was $17,734. The letter also alluded to the property being in an unsatisfactory state, and that Mr Memik would take legal action if no response was received by him within 21 days of the date of the letter. An extract of the letter is as follows:

10. [35]

    Mr Memik never sought to be reimbursed by the defendant in respect of insurance premiums he had paid in respect of the property.

11. [36]

    Mr Memik accepted that, following the provision of legal advice, he later realised that the Deed did not require the defendant to pay any outgoings.

12. [37]

    I accept, as was conceded by Mr Memik during cross-examination, that the plaintiffs have never paid for electricity and gas for the property. The defendant has paid for electricity and gas since settlement, and has contributed to water rates since February 2024, following the request for contribution by Mr Memik (despite the fact that there was no obligation to do so under the Deed).

13. [38]

    Between September 2023 and February 2024, a number of letters passed between the plaintiffs’ solicitor and the defendant. The principal parts of those communications were as follows:

    1. (1)

       The first letter from plaintiffs’ lawyer to defendant was dated 29 September 2023:

    2. (2)

       Letter from defendant to plaintiff’s lawyer dated 19 October 2023:

    3. (3)

       Letter from plaintiffs’ lawyer to defendant dated 13 November 2023:

    4. (4)

       Letter from defendant to plaintiffs’ lawyer dated 21 November 2023:

    5. (5)

       Letter from plaintiffs’ lawyer to defendant dated 30 November 2023:

    6. (6)

       Letter from defendant to plaintiffs’ lawyer dated 7 December 2023:

    7. (7)

       Letter from plaintiffs’ lawyer to defendant dated 24 January 2024:

    8. (8)

       Letter from defendant to plaintiffs’ lawyer dated 31 January 2024:

    9. (9)

       Letter from plaintiffs’ lawyer to defendant dated 15 February 2024:

14. [39]

    I accept, on the basis of these letters, that the defendant raised an issue regarding her ability to comply with the insurance condition as early as 19 October 2023, and requested the plaintiffs’ cooperation to facilitate her compliance with that condition. Perhaps in consequence of the inappropriately aggressive content and tone of the plaintiffs’ solicitors’ letters, they either ignored or disregarded any request by the defendant for their cooperation. In my view, the plaintiffs were intent on advancing their position that the defendant vacate the property, and as a result, failed to consider their own obligations under the Deed.

15. [40]

    Further, I note that the demand by the plaintiffs that the defendant pay them market rent of $210,000 for the past 5 years, was completely unfounded under the Deed or otherwise in law. This appears to have been a tactic used to bully a vulnerable member of the community into relinquishing her legal rights and is inappropriate.

16. [41]

    The termination notice was served on the defendant on 16 July 2024, which provided as follows:

17. [42]

    The defendant did not vacate the property, and these proceedings were commenced on 13 August 2024.

Facts in dispute

1. [43]

   The plaintiffs did not cross-examine the defendant or otherwise seek to challenge her evidence. In this respect, the Court had the following exchange with Mr Memik:

2. [44]

   Notwithstanding this exchange, it is necessary to resolve a number of factual disputes between the parties. I will first address my findings with respect to Mr Memik’s credibility, who was cross examined, before turning to the specific issues of fact which arose in the course of the proceedings. I do not propose to give effect to the principles in Browne v Dunn (1893) 6 R 67 in reviewing the evidence, given the unrepresented status of the plaintiffs.

3. [45]

   It should also be observed that despite the detailed particularisation of breaches in the table, many of them were not sustained in evidence, particularly as Mr Memik was cross-examined as to the propositions put and, in many respects, found wanting in his evidence. Nonetheless, I will make some occasional references to the table in examining either Mr Memik’s credit or the issues in dispute.

4. [46]

   In relation to credibility, I adopt the statement of principle in Liu v Lam [2024] NSWSC 1306 at [59] to [60]:

5. [47]

   I have also taken into account the observations of Kunc J in Pavlis v Pavlis [2021] NSWSC 1117 (“Pavlis”) at [158] to [167], with which I broadly agree.

6. [48]

   However, the principles set out by Kunc J in Pavlis are, of course, not principles of law to be applied on every occasion. Rather, they are matters stated to be derived and applied from particular cases based on the facts of those cases. Ultimately, it is up to the Court to assess the whole of the evidence presented, including, in that respect, issues concerning credit, and make its own findings based on that evidence.

7. [49]

   Based on my overall assessment of Mr Memik’s evidence, which derived, in part from my close observations of him as a witness, I have real doubts about Mr Memik’s credibility.

8. [50]

   Mr Memik was often evasive and argumentative in his evidence and had difficulty accepting propositions which could not reasonably or sensibly be denied. In my view, Mr Memik was intent on advancing his own case rather than giving candid and frank evidence, or making concessions where properly required.

9. [51]

   For example, when Mr Memik was questioned about the purchase price of the property and whether he and the defendant had a conversation about the proposed price, Mr Memik gave evidence that:

10. [52]

    I do not accept that the parties never discussed the purchase price prior to their agreement to sell and purchase the property. That suggestion is fanciful, contrary to other evidence (including his own), and, in my view, demonstrates Mr Memik’s resolve to advance his own interests rather than give honest evidence.

11. [53]

    Further, when Mr Memik was asked how the purchase price was fixed, he gave evidence that “It wasn’t fixed. I only offered her what I could afford. The price was not fixed”, before going onto say “Well, my borrowing capacity is pretty high, I’m not worried about that, but it’s just that, what I could afford”. Mr Memik’s evidence, in this respect, was unclear, inconsistent and disingenuous.

12. [54]

    When giving evidence about his obligation to insure the property pursuant to the terms of his mortgage, Mr Memik gave the following evidence:

13. [55]

    In my view, this exchange demonstrates Mr Memik’s propensity to be argumentative in response to simple propositions, especially where the truth or reality of the circumstances may not assist his case.

14. [56]

    Lastly, and most significantly, I also find that there were parts of Mr Memik’s evidence which were deliberately false. For example, Mr Memik’s affidavit stated that “[s]hortly after the purchase of the property I took photographs of the exterior of the house where the defendant was living and the surrounds of the property”. The photographs which were said to be taken by Mr Memik in January 2019 were contained at pages 69 to 73 of Exhibit 2 in these proceedings (being the Exhibit to Mr Memik’s affidavit dated 14 November 2024).

15. [57]

    However, I accept, as was submitted by counsel for the defendant, that the photographs contained at pages 69 to 73 of Exhibit 2 were not taken by Mr Memik at all. As was ultimately accepted by Mr Memik in cross-examination, the images contained at pages 69 to 73 were downloaded from Google Maps. Further, the image contained at page 69 of Exhibit 2 was not taken in January 2019, but was date stamped 29 December 2021. This fact was also accepted by Mr Memik.

16. [58]

    Hence, Mr Memik’s affidavit contained two lies:

    1. (1)

       That he personally took the photographs contained at pages 69 to 73 of Exhibit 2, when in fact, these were images downloaded from Google Maps.

    2. (2)

       That each photo was taken in January 2019, when in fact, the image contained at page 69 is from a date in December 2021.

17. [59]

    I will discuss further inconsistencies with Mr Memik’s evidence in my consideration of the facts which are in dispute. However, given the issues of credit I have discussed and the further discussion of those inconsistencies below, I am not inclined to accept Mr Memik’s evidence unless it is independently corroborated, or, against his interests.

18. [60]

    There was a dispute between the parties as to whether the purchase price for the property was $600,000 or $800,000. The plaintiffs claimed that the purchase price was $600,000, however, the defendant claimed that the agreement reached between the parties was $800,000.

19. [61]

    The defendant claimed that Mr Memik wanted the additional $200,000 to be “dealt with privately and not on the books”. As evidence of her claim, the defendant tendered a photocopy of her notebook which contained a handwritten note, as follows:

20. [62]

    While I accept that this does represent some objective proof of the fact of the purchase price, this must be matched against the balance of the objective documentation in this matter.

21. [63]

    There is nothing on the face of the defendant’s affidavit, when viewed in the light of Mr Memik’s evidence, which would warrant a conclusion that the evidence she gave in her affidavit was either dishonest or unreliable, and as such, I accept that there were likely conversations and negotiations between the parties whereby they discussed the purchase price and even an offer of $800,000. However, I also accept, that whatever those discussions were, they ultimately did not come to fruition.

22. [64]

    In the face of objective documents, including the contract for sale and the Land Registry transfer (which both list the consideration as $600,000), I do not accept that the purchase price was $800,000. Rather, I accept that the purchase price (in monetary terms) was $600,000.

23. [65]

    I note there was also a question as to whether the equitable interest in the life estate granted by the Deed formed part of that consideration. It was submitted by counsel for the defendant that having regard to the market value of the property at the time of settlement, the plaintiffs essentially got a bargain on the basis that they were agreeing to grant the defendant a life estate in the property.

24. [66]

    I accept that the Deed, and in particular the equitable interest granted to the defendant pursuant to the Deed, did form part of the consideration for the transfer of the property to the plaintiffs.

25. [67]

    I accept that this was the case, for the following reasons:

    1. (1)

       The defendant had received verbal quotes from local real estate agents during 2017, estimating the value of the property at around $850,000 and $900,000.

    2. (2)

       The grant of the life estate was a special condition in the contract for sale and was specifically designated as an “essential term” of the contract for sale.

26. [68]

    Hence, I accept the submission made on behalf of the defendant, that the grant of the life estate was, on the balance of probabilities, part of the deal struck between the parties, and that the contract for sale (at a purchase price of $600,000) would not have proceeded without the grant of the life estate.

27. [69]

    With the exception of the photos downloaded from Google Maps, there was no evidence before the Court to demonstrate what condition the property was in prior to settlement. During cross-examination, Mr Memik accepted that he did not document (in writing or in photographs) the condition of the property prior to settlement, despite accepting that this would have been “sensible”.

28. [70]

    When asked about the condition of the property prior to settlement, Mr Memik responded that the condition was “good” and clarified that by “good” he meant that the property was “liveable”.

29. [71]

    Mr Memik accepted that there were no other photos that show the condition of the property as at October or November 2018, and hence, it was up to the Court to simply accept his evidence that the condition was “good”.

30. [72]

    In summary, Mr Memik gave the following oral evidence by reference to photographs he had taken of the property, in support of the claim that the property had not been adequately maintained by the defendant:

    1. (1)

       Mr Memik noted that his concern was “the overall situation of the house”, noting that before “[i]t was a nice, liveable situation”.

    2. (2)

       In respect of the shrubs at the front of the house, that it was a “jungle out the front now”, and that there was “overgrowth of the shrubs” and vegetation in other areas of the property.

    3. (3)

       That there were missing tiles on the garage roof.

    4. (4)

       That there was rubbish on the tennis court in the backyard.

    5. (5)

       That there was mould on the front of the house.

    6. (6)

       That there was vegetation growing from underneath the roof tiles on the garage, and along the exterior walls of the house.

    7. (7)

       That the front gate of the house was not connected to its hinge.

    8. (8)

       That the upstairs window at the front of the house was replaced with Perspex, was not professionally installed, and as a result is not watertight.

    9. (9)

       Rubbish at the front entrance of the house, and general rubbish around the property and on the veranda.

    10. (10)

        That there were cobwebs on a window on the western side of the house.

    11. (11)

        The “general care of the guttering” and that the gutters were “rusted away”.

    12. (12)

        That the windows on the right-hand side of the house have a 20-millimetre gap between the top of the window and the window frame.

    13. (13)

        That the brickwork was “dirty” and “cracking”.

31. [73]

    Mr Memik claimed that there were “probably” structural problems with the house, and that “the amount of water that’s going into my house at the moment is just unexplainable”. These claims were made by Mr Memik despite him also accepting that he had never inspected the interior of the house.

32. [74]

    Mr Memik’s claim of water ingress was on the basis that the Perspex window replaced by the defendant was not watertight because it was not professionally fitted. The table set out the following contentions, in this respect:

    1. (1)

       Weather including wind and rain has entered the interior of the dwelling at each of the areas the window frames have rotted out where there is the placement of what appear to be ‘perspex sheets’ leaving gaps between the sheets and the frames.

    2. (2)

       The placement of ‘perspex sheets’ leaving gaps between the sheets and the window frames was not undertaking by a duly qualified tradesman and/or was not performed in a proper and workmanlike manner.

33. [75]

    When Mr Memik was questioned as to whether he had any particular expertise or knowledge that would enable him to conclude that a perspex window was not watertight, Mr Memik responded that “[i]t’s just common sense”. Similarly, when questioned as to what led him to conclude that the window had not been professionally fitted, he responded “[b]ecause a professional won’t leave a job like that”. When it was suggested that Mr Memik was in no position to know whether there was water ingress, he again responded that “it’s just common sense”.

34. [76]

    In my view, these claims by Mr Memik as to water ingress are, on the evidence, without foundation. However, it would appear that perspex was used to replace a broken window. It is quite improbable this was undertaken professionally or that the replacement maintained the property in the state it was in before settlement, which appears to have had a window where the perspex is now located. The affixing of a perspex barrier or window does not maintain the property to the standard it was at settlement or maintain a proper and effective means of enclosing the building.

35. [77]

    I also do not accept that there are any structural defects with the house, or any defects with respect to the interior of the property. There is simply no evidence to support that contention.

36. [78]

    Similarly, with respect to the plaintiffs’ contention that the “brickwork [was] cracked” (as set out in the table), in my view, there is an absence of evidence to support a finding, on the balance of probabilities, that the brickwork was in a different condition as at settlement. The photos said to support that conclusion are inconclusive.

37. [79]

    There was extensive cross-examination in respect of the missing tiles on the garage roof, whereby Mr Memik was asked to mark on photographs where he said that the tiles were missing.

38. [80]

    Having regard to this evidence, and my own observations of the photographs, I accept that the extent of the issue complained of by Mr Memik, is that there is one singular tile missing from the roof of the garage contrary to his evidence that there were missing “tiles”.

39. [81]

    Further, I also note that there is no evidence to substantiate the plaintiffs’ contention (as set out in the table) that, “[t]iles missing from the roof permits the ingress of water into the roof cavity and interior envelope of the dwelling”.

40. [82]

    The only evidence before the Court was as to a single missing tile on the garage roof. There is no evidence as to whether that had permitted any water ingress into the garage, or whether it had caused any water damage. There is no evidence of a missing tile in the roof of the building proper. Further, Mr Memik has never inspected the interior of the house, and there is otherwise no evidence to suggest water ingress in the roof cavity of the dwelling.

41. [83]

    The plaintiffs complained that the front of the house had “mould on it” and that the exterior walls on the second storey were “mouldy” and “dirty”. This claim, as set out in the table, was that “[e]xterior fascia, bargeboards, soffits, eaves, exterior walls on second storey” were “mouldy and dirty” and “require cleaning and painting”. It was also contended that the exterior brickwork was “dirty and requires cleaning”.

42. [84]

    The photographs provided in evidence did not concern or make clear each area of the dwelling referred to in the table. I further note that a distinction needs to be drawn between areas which were mouldy and dirty and those that were simply dirty.

43. [85]

    However, during cross examination as to page 164 of the court book, Mr Memik accepted that this complaint was difficult to sustain by reference to the photographs of the house alone. He stated that:

44. [86]

    The photograph at page 164 depicts a distant view of exterior walls on the second storey, and a very unclear view of the face of the brick walls at the front of the house. I agree with Mr Memik, that the complaint that the front of the house has mould on it cannot be sustained on the basis of the photographs at page 164 of the court book.

45. [87]

    Further, even if the photographs were sufficiently clear, I am in no position to conclude, on the evidence, as to whether something is mould, on the basis of photographs alone. Mr Memik is not qualified to make such an assessment and I, for the reasons earlier given, do not accept him as a credible witness. The Memiks bear the onus of establishing non-compliance of the clause 2.2(a) of the Deed, and their view on this issue amounts to no more than mere speculation. Hence, that part of the table dealing with exterior walls on the second storey as being mouldy cannot be sustained.

46. [88]

    A different proposition arises as to whether the exterior walls on the second storey or the brick walls on the front of the house are dirty. There would appear to be a sufficient material in the photographs before the Court to allow such a conclusion when regard is also had, for example, to the photograph at page 192 of the court book of the exterior brick wall.

47. [89]

    I find, therefore, that the complaint by the plaintiffs as to mould, both in the table and in the evidence is unsubstantiated on the evidence. There is evidence as to dirty exterior walls.

48. [90]

    In the table, the plaintiffs contended that there were “[s]hrubs growing between the roof tiles”. I accept that the aerial photos of the property taken in July 2024, do demonstrate that there is vegetation which appears to be growing from underneath the roof tiles on the garage, through the guttering and otherwise growing in an unkempt manner.

49. [91]

    However, there was no evidence before the Court to demonstrate that such vegetation did not exist prior to settlement. In this regard, I note that the aerial picture provided (which was said to demonstrate the condition of the property in January 2019) was date stamped 29 December 2021, being a date almost 3 years after settlement.

50. [92]

    As such, I do not accept that there is sufficient evidence to support this particular contention, namely, that the defendant had permitted the growth of vegetation after settlement which affected the integrity of the built structure or part of the built structure, namely, the garage.

51. [93]

    The table set out a number of claims with respect to the windows and window frames, including:

    1. (1)

       That the window frames (in various locations) were “rotted out” and that “[w]eather including wind and rain would have entered the interior of the dwelling at each of the areas the window frames have decayed and/or deteriorated”.

    2. (2)

       That the window frames (in various locations) “require replacement or repair, and sealing and painting”, and are “dirty and mouldy”.

    3. (3)

       That the windows (in various locations) are “dirty and require cleaning”.

52. [94]

    Other than the photographs provided by the plaintiffs, there was no further evidence adduced with respect to these claims. As such, on the basis of the evidence, I do not accept the plaintiffs’ contentions in this respect.

53. [95]

    With respect to the finding as to the overgrown gardens, there were a number of issues raised by the plaintiffs in this respect, including:

    1. (1)

       Shrubs overgrown.

    2. (2)

       Weeds growing on driveway.

    3. (3)

       Front hedge not pruned.

    4. (4)

       Grass, garden and shrubs in backyard and on ground storey side access overgrown and unkempt.

    5. (5)

       Weeds in backyard.

54. [96]

    Whilst I will later find that gardening falls within the requirements of cl 2.2(b) of the Deed, there are many elements of the complaints in the table (as set out immediately above) that are rather trivial in nature. Some are more substantial in nature. In either case, in my view, the non-performance by the defendant with respect to gardens could not possibly establish a basis for a breach, let alone a breach constituting a basis for termination.

55. [97]

    In my view, by reference to the only objective evidence before the Court as to the pre-settlement condition of the property (being images downloaded from Google Maps), the only complaints that can be sustained by the plaintiffs are as follows:

    1. (1)

       A singular missing roof tile.

    2. (2)

       Overgrown gardens (including shrubs), although, I do accept that the defendant has regularly retained a lawn mowing service since October 2021.

    3. (3)

       Front gate not connected to its hinge.

    4. (4)

       Excessive general rubbish and debris around the house, except for the rubbish on the tennis court, which I accept (as was conceded by Mr Memik) was not removed by Mr Memik following the removal of a structure from the tennis court.

    5. (5)

       The replacement of a perspex rather than glass window at the front of the house following heavy storms.

    6. (6)

       Dirty exterior walls.

56. [98]

    While the evidence does establish that there is excessive waste and garbage around the property, I do not intend to deal with the particulars in the plaintiffs’ table because I will later find that the existence of such waste or rubbish, does not fall within the obligations reposing in the defendant under cl 2.2(a) of the Deed.

57. [99]

    In his affidavit, Mr Memik gave evidence that “[i]n order to protect the property because the defendant refused to insure it as she had agreed… I took out an insurance property for [the property].” He also gave oral evidence, as follows:

58. [100]

    However, when questioned on this aspect of his evidence, Mr Memik conceded that the policy of insurance he took out for the property ran from a time before the plaintiffs had entered into the contract for sale, and that the property had been separately insured by him from 20 September 2018 (being a date before the parties had entered into the contract for sale and the Deed) to date.

59. [101]

    When further questioned about whether the defendant’s failure to take out insurance was really the motivating factor in Mr Memik taking out an insurance policy, he gave the following evidence:

60. [102]

    In my view, it was both misleading and dishonest for Mr Memik to suggest that the only reason he insured the property was because of the defendant’s failure to do so. The plaintiffs clearly had an obligation to insure the property (with an approved insurer) pursuant to the terms of their mortgage, and in my view, did take out and maintain an insurance policy for the property regardless of the defendant’s actions.

61. [103]

    Further, Mr Memik gave evidence that he had never told the defendant about the terms of that mortgage or gave her information about who an “approved insurer” was for that purpose. Ultimately, Mr Memik conceded that he never provided the defendant with the information that was necessary for her to insure the property in a way that would comply with the mortgage:

62. [104]

    I accept that the defendant did seek to obtain insurance for the property, including by contacting a number of different insurance companies for quotes. I also accept the defendant’s evidence, that each insurance company refused to provide the defendant with insurance on the basis that she was not the registered proprietor of the property.

63. [105]

    Mr Memik conceded that, despite the defendant’s requests, he did not provide her with the documents she requested to allow her to comply with her obligations under the Deed. In my view, Mr Memik did not properly or adequately cooperate with the defendant in respect of her obligations under the Deed.

64. [106]

    I accept that on 7 December 2023 the defendant even suggested to the plaintiffs, that they take out an insurance policy and invoice the defendant on a monthly basis, in order to facilitate her compliance with the terms of the Deed, as she did not otherwise have an “insurable interest” in the property that would allow her to comply with cl 2.2(b) of the Deed. In cross-examination, Mr Memik stated that he would have been content with that course.

65. [107]

    I also note that Mr Memik had already asked the defendant to reimburse him for council and water rates, so the concept was not foreign.

66. [108]

    However, the plaintiffs did not take up the defendant’s suggestion, and on 24 January 2024 again notified the defendant that she was required to vacate the premises on the basis, inter alia, she had not taken out the requested insurance. Mr Memik accepted that he had no reason to doubt the truth of what the defendant conveyed to the plaintiffs with respect to her inability to obtain insurance. However, regardless of that, the plaintiffs continued to ask the defendant to take out an insurance policy in strict accordance with cl 2.2(b) of the Deed.

67. [109]

    I accept, as was suggested by the defendant, that the plaintiffs did not cooperate with the defendant to facilitate her compliance with the terms of the Deed. The plaintiffs effectively precluded the defendant from complying with her obligation to take out insurance contrary to her desire to so comply. As I will discuss below, this circumstance arose in breach of the plaintiffs’ obligation to cooperate and made the performance of the Deed effectively impossible.

68. [110]

    There is some force to the suggestion by the defendant that these circumstances illustrate that the plaintiffs’ true intention was to gain possession of the property by manufacturing a basis to terminate the Deed. The plaintiffs’ solicitors’ letters also resonate with this proposition. However, it is unnecessary to decide this point to resolve the issues in this manner.

69. [111]

    In summary, I find that:

    1. (1)

       The defendant endeavoured to take out insurance but was unable to do so because she did not have an insurable interest.

    2. (2)

       The defendant approached the plaintiffs with the express intention of curing that impasse by having the plaintiffs take out the requisite insurance and making payment to the plaintiffs for the cost of that insurance.

    3. (3)

       The plaintiffs obstinately refused to respond to either that difficulty or those requests, thereby creating a circumstance in which it was impossible for the defendant to take out the insurance required by cl 2.2(b) of the Deed, or, in lieu of taking out the insurance, to recompense the plaintiffs, who had the insurable interest for taking out such insurance (noting that the plaintiffs did take out insurance over the property).

70. [112]

    Given the Deed contained a clause with respect to the development of the property by the plaintiffs, I accept that at the time of purchasing the property, the plaintiffs had plans to develop the property.

71. [113]

    Following settlement, Mr Memik visited the property fortnightly, as he “was wanting to develop the back of the block”. However, Mr Memik deposed that:

72. [114]

    In a letter to the defendant dated 24 April 2023, Mr Memik stated that cl 2.3 of the Deed provided for right of unfettered access to the rear of the property, and that he “would like 24/7 access as I will commence building at the rear very soon”.

73. [115]

    As such, it is unclear exactly when the plaintiffs abandoned their plans to develop the property. While Mr Memik claimed during cross-examination that this was in late 2019, that is difficult to believe given the letter dated 24 April 2023.

74. [116]

    Given the credit findings I have made with respect to Mr Memik, I have difficulty accepting that the plaintiffs have no plans whatsoever to develop the property, whether now or in the future.

CONSIDERATION

1. [117]

   My consideration proceeds on the basis of the aforementioned factual findings with respect to the issues stated in the ASOI. However, I shall compress the discussion of the issues under a number of overarching headings, which appear below. I have adopted this approach as there was significant overlap in the submissions received under various headings which the parties adopted in the ASOI, which did not correspond to the issues or order of the issues in the ASOI.

2. [118]

   I shall commence the discussion of eachbundle of issues by setting out the position of the parties as recorded in the ASOI. I will commence by a consideration of the construction of the Deed and the nature of the defendant’s interest (on a proper construction of the Deed).

The nature defendant’s interest under the Deed

1. [119]

   Plainly the delineation of the defendant’s interest (and the resolution of other issues raised by the parties) will require a construction of the Deed, and in that respect, I accept, the submission of counsel for the defendant, that the Deed is to be interpreted in accordance with the principles of interpretation articulated in Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104; [2015] HCA 37, that is, objectively by reference to its text, context and purpose.

2. [120]

   In Tin-Tagel Majikk Pty Limited v Hockey [2025] NSWSC 578, the following further observations were made about the construction of a contract (at [147] – [150] per Walton J):

3. [121]

   In this respect, the defendant correctly submitted that the Deed must be interpreted in the context that the defendant was giving up her right of proprietorship of the property in favour of the plaintiffs, and that the plaintiffs promised the defendant that she could live in part of the property for an extended and indefinite period of time.

4. [122]

   The plaintiffs submitted that:

   1. (1)

      The metes and bounds of the grant of a life estate to the defendant are recorded entirely in the contract for sale (per clause 43) and the Deed. Both the contract for sale and the Deed have an entire agreement clause and were prepared by the solicitor for the defendant. There was valuable consideration for both and reflected the objective intention of the parties of entering into each instrument.

   2. (2)

      The defendant has not identified or asserted any additional term(s), or the source of any such additional term(s), other than those expressed in the contract for sale and the Deed, save for an implied term requiring cooperation between the parties.

   3. (3)

      The metes and bounds of the grant of a life estate to the defendant was a personal right of residence to the dwelling and curtilages for as long as she is alive which may be used by the defendant in her absolute discretion, subject to the defendant’s compliance with cl 2.2 of the Deed. The dwelling and curtilages included the interior of the dwelling and the garage.

   4. (4)

      The defendant has not identified any specific rights, duties or obligations on the parties beyond referring to the interest “carrying such rights as attached to a life tenant of land in equity comparable to the rights of a beneficiary under a will”. The defendant has not identified the rights that are said to attach to a life tenant of land in equity comparable to the rights of a beneficiary under a will and/or how her interest is a life estate in equity rather than a set of rights and obligations pursuant to the contract between the parties (as expressed in the contract for sale and the Deed).

   5. (5)

      The plaintiffs submitted that the grant of the life estate was only a personal right of residence to the defendant. There is no life estate recorded on the title to the property, and there was no term of the contract between the parties that the defendant was to retain any legal or equitable interest in the property. Further, the defendant is not able to transfer to anyone else her interest in the property. By the operation of ss 41 to 43 of the Real Property Act, the plaintiffs have indefeasibility of title in the property.

   6. (6)

      Clause 3 of the Deed did not give the defendant a legal or equitable interest (i.e. a proprietary interest in the property). The clause provides no more than a right in personam to the defendant to lodge a caveat on the property, in limited circumstances. In any event, no caveat has ever been lodged by the defendant against the property.

5. [123]

   It is true that there is no life estate recorded on the title to the property. Nor may it be disputed that the plaintiffs’ case rests upon an indefeasible title (see sections 41, 42 and/or 43 of the Real Property Act). However, the defendant brings a case in equity. In Barry v Heider (1914) 19 CLR 197; [1914] HCA 79 at 213 (per Isaacs J), the High Court held that:

6. [124]

   The Deed defines “Property” in a way which confines the defendant’s interest to a particular portion of the property. The definition confines the area the defendant is permitted to occupy to the dwelling and curtilage on the property, within the defined area to which the defendant’s interest under the Deed was restricted. The defendant was not entitled to occupy the area of the tennis court at the rear of the land, and cl 2.3 of the Deed permitted the plaintiffs to enter and undertake development.

7. [125]

   The defendant’s interest in that portion of the property is described in the Deed as “an equitable life interest” (in the definition of a “Life Estate” in cl 1.1 of the Deed), which includes, I would accept on the submissions of the parties, the dwelling and curtilage on the land.

8. [126]

   The question which arises in this context then, is, what is the nature of the defendant’s equitable life interest?

9. [127]

   In my view, the proper construction of the Deed must result in the conclusion that the parties intended in something more than a mere right of residence.

10. [128]

    A right of residence is properly characterised as a licence to occupy the dwelling and curtilage in the defined area, but the Deed also gives the defendant the right to lodge a caveat over the whole property, which suggests that the parties objectively intended to grant a proprietary interest.

11. [129]

    Clause 3 of the Deed not only grants the defendant a capacity to register a caveat on “title” of the property (see cl 3.1 of the Deed). Clause 3.2 also stated that the plaintiffs warranted that cl 3.1 granted the defendant a “valid caveatable interest in the Property” and, furthermore, indemnified the defendant against any loss or damage sustained by her, including legal costs on a full indemnity basis, as a result of the plaintiffs breaching the warranty or the defendant having to set aside a lapsing notice issued by the plaintiffs.

12. [130]

    I do not consider that the title to cl 3 of the Deed, namely, “charging provision” adequately describes the nature of the interest conferred by that clause as the interest described therein is not confined to a “charge”. Furthermore, for the purposes of construing the Deed, it matters little that the defendant did not take out a caveat, because it was the nature of the right conferred by cl 3 of the Deed itself, which specifies the nature of the interest conferred by the clause and sets out the intention of the parties in that respect.

13. [131]

    The same conclusion follows from an examination of the contract for sale. Notwithstanding that the parties concur that the relevant Deed for the purposes for these proceedings is the Deed executed by the parties as opposed to the deed attached to the contract for sale, the deed annexed to the contract for sale contains a counterpart provision to cl 3 of the Deed, such that, there was established by that deed a caveatable right in the defendant. The fact that the Deed attached to the contract was not ultimately signed by the parties does not diminish the significance of this consideration as it formed part of the contract for sale. Nor is the defendant’s interest diminished by the defendant not having registered the interest in the title, because cl 3.1 provides a capacity in the defendant to register the caveat on title.

14. [132]

    In my view, the charge in cl 3 of the Deed supports a conclusion that the objective intention of the parties was to confer on the defendant more than a personal right of residence. Rather, a right in personam arises because the defendant has an equitable proprietary interest. The conferral of a right to lodge a caveat is the indicium that the parties intended the interest granted to be an interest that would support that lodgement of a caveat, that is, “any… equitable estate or interest in land” within the meaning of s 74F of the Real Property Act.

15. [133]

    In my view, the Deed effected the grant of a life estate in fee simple in equity, binding the plaintiffs as purchasers in personam despite their registration as proprietors and amounted to an interest in land sufficient to support a caveat and carrying such rights as attach to a life tenant of land in equity.

16. [134]

    It follows that the answer to questions 4, 5 and 6 of the ASOI are as follows:

    1. (1)

       The Deed records the whole agreement between the plaintiffs and the defendant. I have already dealt with the question of consideration.

    2. (2)

       On the proper construction of the Deed, the grant by the plaintiffs of a life estate in the “Property”, as defined in cl 1.1 of the Deed, conferred on the defendant a life estate in fee simple.

    3. (3)

       None of the three options identified by the parties in question 6 entirely accurately defines the area the defendant was entitled to occupy, unless the opening words of the issue were intended to have the effect of confining option (b) to the “Property” as defined in cl 1.1 of the Deed. It follows that, in my view, the defendant was entitled to occupy the dwelling and curtilages within the restricted area defined in the definition of Property in cl 1.1 of the Deed. It is implicit in the definition of Property in cl 1.1 of the Deed and the life estate itself, that the defendant would occupy the dwelling and naturally, for the purposes of issue 6(c), that would include the interior of the dwelling. The photographic and oral evidence discloses that the garage is situated on the restricted area of the property that may be occupied by the defendant.

17. [135]

    The plaintiffs submitted that the maintenance condition was an essential term where the defendant was to live in a property that was owned by the plaintiffs. The vendors had been paid $600,000 for the property, and the defendant was permitted to use it in her absolute discretion, provided she regularly maintained the dwelling and curtilages to the standard that existed at the time of settlement. This was an essential term that protected the owners of the property from waste and damage to their valuable asset by the defendant.

18. [136]

    The parties’ attention with respect to the preamble to cl 2.2 of the Deed were fixed upon the words “subject to” and generally omitted consideration of the words “and conditional upon”. The expression which is used in the chapeau to cl 2.2 is “subject to and conditional upon”.

19. [137]

    The first observation that may be made in that respect is that, that expression is not intended to communicate an intention that the entry into the contract for sale or the grant of a life estate in the property was conditional upon the satisfaction of the obligations of under cl 2.2(a) and (b) of the Deed.

20. [138]

    The Deed arises from the terms of cl 43 of the contract for sale. Whilst cl 43 of the contract for sale is said to be an essential term (see cl 43.3) and the obligations of cl 43 do not merge on completion (see cl 43.4), the limit of the obligation under the contract for sale is that the parties will enter the deed of life estate attached to the contract on or before the completion date. Clause 43.2 of the contract for sale provides that the Deed will become binding upon its execution. There is no other requirement attaching to the Deed or appearing in cl 43 which makes any aspect of the Deed conditional for the purposes of the contract for sale.

21. [139]

    Nonetheless, the expression used in the preamble to cl 2.2 of the Deed could be suggestive that, when read literally and in isolation from a consideration of the whole of the Deed, the life estate was conditional upon the fulfilment of the provisions of cl 2.2(a) and (b), such that the failure to satisfy those conditions might, as the plaintiff contends, result in a forfeiture of the life estate.

22. [140]

    However, and consistently with the proper interpretation of contracts, the expression in the preamble cannot be interpreted in isolation from the context in which those words appear in the Deed or the purpose of the Deed.

23. [141]

    Ms P Lane of Counsel for the defendant was correct, in my view, to place reliance, in this respect, on the judgment of the High Court in Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 241 ALR 88; [2007] HCA 61 (“Koompahtoo”).

24. [142]

    In the judgment of the majority (Gleeson CJ, Gummow, Haydon and Crennan JJ), there was a relevant discussion, for present purposes, as to the legal principles as to termination for breach. At [47]-[56], the majority opined:

25. [143]

    Reference should also be made to the majority’s discussion of the justification for termination in the following passages (at [68]):

26. [144]

    Compliance with that orthodoxy must result in a rejection of the plaintiffs’ contentions, in this respect, for the following reasons:

    1. (1)

       The immediate context is to be found in the requirements of subs (a) and (b) of cl 2.2 of the Deed. The words “regularly maintaining the Property and Improvements” in cl 2.2(a) of the Deed are strongly suggestive that the requirements of cl 2.2(a) are not to be construed as creating a condition precedent or an essential term constituting a basis for termination.

    2. (2)

       As is evident from the expression “regularly maintaining the Property and Improvements”, the provision makes no distinction in its terms between substantial and insubstantial or trivial occurrences of non-performance. It is inconceivable that the clause may strictly operate so as to effect a basis for termination upon mere trivial non-performance.

    3. (3)

       The many and varied ways in which a breach may occur pursuant to cl 2.2(a) tells against the terms imposing conditions under which immediate termination is the appropriate outcome.

    4. (4)

       By its very nature, the notion of “regularly maintaining” cannot constitute a contingency, because the provision does not operate with respect to a specified event, but an ongoing obligation on the part of the defendant. The obligations in the Deed, including the grant of the life estate, are unlikely to be contingent on the occurrence of cl 2.2(a) because of the indeterminate nature of that obligation.

    5. (5)

       There is no provision for termination for breach in the Deed. In my view, this reflects the purpose of the Deed, as earlier mentioned, to provide for long term occupancy for the defendant

27. [145]

    These same factors point to cl 2.2 of the Deed constituting an intermediate term. It is not possible to delineate whether any particular breach of the term would entitle a party to the Deed to terminate, but it is conceivable that some breaches may be serious enough to have that consequence in so far as they go to the “root of the contract”. The focus of attention should be the contract and the nature and seriousness of any breach or breaches.

28. [146]

    In my view, there is no reason on the construction of the Deed to treat the provisions of cl 2.2(b) of the Deed any differently. The nature and seriousness of any breach will govern whether the breach warrants termination.

29. [147]

    Returning then to the questions posed in the ASOI, the answer to the question 7 should be, respectively, as follows:

    1. (1)

       No.

    2. (2)

       Yes.

    3. (3)

       An intermediate term.

30. [148]

    The plaintiffs submitted that the term “regularly maintaining” is to be given its natural and ordinary meaning in the objective circumstances in which these parties contracted, that is to say the defendant was legally obliged to maintain (i.e. keep, upkeep, manage, preserve, conserve, care for, protect, retain, sustain, uphold) the dwelling and curtilages taking into account (i.e. meaning up to the standard of) their condition as at settlement.

31. [149]

    The plaintiffs further submitted that the requirement that this was done regularly was not a prescriptive requirement as to time or frequency but rather was the requirement that it occur routinely, so the dwelling and curtilages were kept up to the standard that existed at the time of settlement.

32. [150]

    There would not seem to have been a dispute about the plaintiffs’ construction of cl 2.2(a) of the Deed in that respect. Certainly, there was common ground that the words “taking into account there conditions as at Completion” meant that the requirement reposing in the defendant by the clause was to maintain the condition of the dwelling and curtilage at the date of settlement and that the obligation did not extend to putting into repair, items that were out of repair as at that date.

33. [151]

    Whilst not explicit in the plaintiffs’ submissions, there would nonetheless seem to be common ground that the obligation to maintain can only logically extend to the area the defendant was entitled to occupy under the Deed.

34. [152]

    In my view, the plaintiffs’ attribution of meaning “regularly maintaining” in cl 2.2(a) of the Deed, when understood in the light of the restrictions to the scope of the meaning of the expression imposed by the Deed and as discussed above, are sound.

35. [153]

    The real issue, in this context, was the scope of the obligation of the defendant to maintain the property within the restricted area of the property, as defined in the expression “Property” in cl 1.1 of the Deed.

36. [154]

    In that respect, and again subject to the limitations to which I have referred, there was no dispute that the defendant had an obligation to maintain the dwelling. The garage did not receive particular attention by the defendant, but in view of the conclusion I have earlier reached, it too must be subject to the obligations to regularly maintain in cl 2.2(a), as it is situated immediately adjacent to the dwelling within the restricted area occupied by the defendant.

37. [155]

    The defendant submitted that most of the matters alleged by the plaintiffs do not fall under the head of maintenance as that term should be understood in context, which relates to the structural condition of the property.

38. [156]

    It was from that proposition that the defendant submitted that the requirements of cl 2.2(a) of the Deed were confined to structures and that that interpretation was fortified by the reference to “Improvements” in cl 2.2(a) because the natural meaning of that expression, when in read in context, was improvements to the physical structure on the property.

39. [157]

    It followed, in the defendant’s submission, that neither gardening or the question of waste or cleanliness was caught by the terms of cl 2.2(a) of the Deed because both subjects involved aspects of the property or items on the property which were temporary, involving a continuing activity or aesthetic in nature. Any attention given by the defendant to maintenance in those respects did not affect the structural integrity of the premises. A comparison was drawn with the obligations arising in tenancy law, as to an obligation “not to do nothing”, that is, an obligation not to let any defect become so bad that it compromises the integrity of the premises.

40. [158]

    Whilst the construction of cl 2.2(a), in this respect, is not without difficulty, on balance, I consider that the construction proposed by Ms Lane is correct, with respect to the management of waste and rubbish, but not with respect to gardens.

41. [159]

    In fact, the provisions of cl 2.2(a) of the Deed, in my view, are antithetical to the notion that the defendant is required under the Deed to manage the property, in the sense of regularly maintain it, with respect to waste or rubbish, for the following reasons:

    1. (1)

       The provision must be construed as a whole. It is true that the provision speaks of “regularly maintaining” the “Property” and “Improvements” in the first sentence of cl 2.2(a), in general. However, the balance of the provision is suggestive that the intention of the provision was directed to considerations other than waste management. Thus, there is a reference to “renovations or modifications” and that “work performed is to be undertaken by duly qualified tradesman”.

    2. (2)

       As suggested by Ms Lane, waste and rubbish are by their nature temporary and continuing issues, and in many respects, as reflected in Mr Memik’s evidence, directed to aesthetic considerations.

    3. (3)

       The notion that waste or garbage is the subject of cl 2.2(a) of the Deed sits ill with the grant of the life estate itself in which it is said that the “Property” and “Improvements” may be used by the defendant in her “absolute discretion” (cl 2.1(b) of the Deed).

    4. (4)

       Waste or garbage control, or lack thereof, does not affect, without more, the integrity of the property or any structure on the property.

42. [160]

    However, I do not agree with the submission of the defendant, that gardens are not caught by cl 2.2(a) of the Deed.

43. [161]

    First, “Property” is defined as “the whole of the land comprised in certificate of title folio identifier 69/193312 known as 26 Brain Street, Balgownie NSW 2519”.

44. [162]

    Secondly, it must follow that the conferral of the life estate concerns the defendant’s use of the whole land (as defined in the Deed), which land includes not only dwellings but gardens.

45. [163]

    Thirdly, there is no suggestion that curtilages were to be excluded from the definition of Property in the Deed and, in fact, the parties tended to approach their respective cases on that basis.

46. [164]

    Fourthly, whilst the word “Improvements” might be suggestive of an improvement to buildings or structures, the word is used in cl 2.2(a) of the Deed in conjunction with the word “Property”. Hence, the provisions should be read as Improvements to Property, which by definition must include the whole of the land and therewith curtilages in the form of gardens.

47. [165]

    Fifthly, tradespersons may extend to persons undertaking landscaping or gardening.

48. [166]

    Sixthly, gardens are not necessarily temporary in nature and may potentially affect structures.

49. [167]

    Seventhly, gardens have the potential to affect the structural integrity in respect of any structure on the property then it appears to me that the provisions of cl 2.2(a) would then properly operate in the event that the defendant did not maintain the plaintiff in such a way as to prevent the damage to the structures on the property.

50. [168]

    I answer question 8(a) in these terms. I will return separately to the issue of breach in question 8(b).

51. [169]

    The plaintiffs submitted that the requirement on the defendant to keep the property and improvements insured for building replacement value and public liability in the sum of $20,000,000.00 is clear on its face in that the defendant either did or did not keep such insurance. This clause was to protect the plaintiffs against loss.

52. [170]

    The defendant submitted that the defendant does not have an insurable interest in the property, so the requirement to insure cannot be interpreted literally in the context that the defendant has no legal interest in the property and is only entitled to occupy a part of the property.

53. [171]

    There is real substance in the defendant’s submission in this respect. To read the provision literally would, in the circumstances, create a condition of impossibility. I have given close consideration to whether the terms of the Deed should be read down, or read with an implication, that the requirement of cl 2.2(b) of the Deed is for the defendant to “use all reasonable endeavours” to keep the property insured. However, it is unnecessary to decide that question, because there are very clear bases to find that no breach would be established, or alternatively, that equity would restrain the plaintiffs from reliance upon that term in the circumstances that I have found existed, including a failure by the plaintiffs to cooperate in enabling the provision to be met.

54. [172]

    I answer question 9(a) in this fashion. I will return to questions 9(b), (c) and (d) below.

The obligations of the defendant under the Deed

1. [173]

   The plaintiffs submitted that:

   1. (1)

      While there appears to be some common ground between the parties as to the construction of the maintenance condition, the factual dispute remains about:

   2. (2)

      The plaintiffs submitted that the defendant has conceded that she is not ready, willing and/or able to perform her contractual obligations.

2. [174]

   The defendant submitted that the particulars of breach do not identify any structural damage that was not present at the time of settlement, and that otherwise the allegations of breach relate to the appearance of the property including the presence of chattels and state of vegetation, which do not fall within the scope of the obligation properly interpreted. Further, the plaintiffs have alleged a failure to maintain areas that do not form part of the area subject to the grant of any interest to the defendant, such as the tennis court.

3. [175]

   I have earlier set out my conclusions in this respect, substantially contrary to the plaintiffs’ contentions, at [95].

4. [176]

   The plaintiffs submitted that it appears to be common ground that the defendant has not insured the property as required under the Deed. The plaintiffs submitted that the defendant has conceded that she is not ready, willing and/or able to perform her contractual obligations in this regard.

5. [177]

   The defendant submitted that the insurance condition cannot be performed without the cooperation of the plaintiffs. As the registered proprietors, the plaintiffs have the insurable interest in the property, and they have in fact kept the property insured as they are required to do so under the terms of their mortgage. In circumstances where the defendant has sought to insure the property and has advised the plaintiffs that she cannot insure the property in her own interest, the mechanism for performance of that term directly by the defendant cannot be carried out. However, the plaintiffs are not entitled to insist on a particular mechanism, where the intent of the term would be achieved by the defendant reimbursing them for the cost of insurance. The plaintiffs have not sought to do this and so are disentitled from relying on the defendant’s failure to insure on her own account.

6. [178]

   As I have earlier found, without recourse to reading down the provision, cl 2.2(b) of the Deed does not operate in such a way that the failure to take out insurance, in circumstances where it is impossible to do so, would constitute a breach. In any event, as I have mentioned, any non—performance could not constitute a basis for the relief of termination in the event of non-performance if, as in this case, the plaintiffs have failed to cooperate to permit the taking out of insurance by the defendant or, in the absence of an ability to do so, to give recompense to the plaintiffs who had taken out such insurance, consequent upon their mortgage and insurable interest. Finally, equity would act to restrain the plaintiffs’ reliance on non-performance in these circumstances.

Alleged breaches and termination

1. [179]

   The plaintiffs submitted that:

   1. (1)

      The defendant has not regularly maintained the dwelling and curtilages, taking into account their condition as at settlement.

   2. (2)

      The defendant has not kept the property and improvements insured for building replacement value and public liability in the sum of $20,000,000.00.

   3. (3)

      The defendant has not acted cooperatively and honestly with respect to the above.

   4. (4)

      Given the breaches by the defendant, the plaintiffs were lawfully entitled to terminate the Deed, and did so validly on 16 July 2024. In any event, were the plaintiffs to be granted the relief they seek in the proceedings, the validity of said notice would be otiose.

   5. (5)

      The defendant is not ready, willing and/or able to perform her contractual obligations.

2. [180]

   The defendant submitted that:

   1. (1)

      The plaintiffs were themselves in breach of an implied term to cooperate to permit the defendant to comply with the requirement to insure by paying the cost of their insurance, which they have never required her to do.

   2. (2)

      The letters sent in September and November 2023 are ineffective to ground any right to terminate for non-performance of the terms of the Deed as:

   3. (3)

      In oral submissions, the defendant submitted that:

3. [181]

   I accept, on the basis of my findings at [95], that the defendant is in breach of cl 2.2(a) of the Deed as a result of the following circumstances:

   1. (1)

      A singular missing roof tile.

   2. (2)

      Overgrown gardens.

   3. (3)

      Front gate not connected to its hinge.

   4. (4)

      The replacement of a Perspex rather than glass window at the front of the house following heavy storms.

   5. (5)

      Dirty exterior walls.

4. [182]

   However, to use the language in Koompahtoo, I do not accept that the nature of the breach and its consequences are sufficiently serious to deprive the plaintiffs of substantially the whole benefit of the contract: Koompahtoo at [49] (per Gleeson CJ, Gummow, Heydon and Crennan JJ). Hence, the breaches do not constitute a valid basis for the plaintiffs to terminate the Deed.

5. [183]

   I answer question 8(b) in the affirmative. However, I do note that the breach established is of limited scope compared to that claimed by the plaintiffs, and as such, would not constitute a basis to grant the relief sought by the plaintiffs in the SOC, being termination of the Deed.

6. [184]

   That still leaves open the question about the appropriate form of relief, in these proceedings, particularly in relation to the defendant’s case in equity.

7. [185]

   I have earlier dealt with the reasons why the plaintiffs have not established a breach of cl 2.2 of the Deed, and in any event, why relevant principles in equity would restrain the plaintiffs from reliance upon any non-performance of the Deed in the circumstances of this case.

8. [186]

   In that earlier discussion, the Court referred to impossibility of performance and an implied duty to cooperate. These concepts are expanded upon briefly, at this juncture.

9. [187]

   Where the parties contracted on the basis that their bargain would be performed in a particular way, and that method of performance is not possible, the contract may be discharged under the doctrine of frustration, provided that the change in performance is radical or substantial: Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337; [1982] HCA 24 (per Stephen, Mason, Aickin, Wilson and Brennan JJ).

10. [188]

    Generally, a party cannot rely on frustration as ground for a partial discharge of the contract, since when frustration occurs, it discharges the whole contract (see Aurel Forras Pty Ltd v Graham Karp Developments Pty Ltd [1975] VR 202; Nelson v Kimberley Homes Pty Ltd [1989] ANZ ConvR 123; (1988) 4 BCL 289 at 291).

11. [189]

    However, there are a number of exceptions to this rule. One such exception arises where an event occurs which does not frustrate the performance of the contract, but instead, proves the promisor with an excuse for not performing (JW Carter and DJ Harland, Contract Law in Australia (4th ed, 2002, Butterworths) at 791).

12. [190]

    I accept that, despite her attempts, the defendant could not perform the obligation in cl 2.2(b) of the Deed on the basis that she did not have an insurable interest in the property. As such, it was impossible for the defendant to give effect to the obligation in cl 2.2(b) of the Deed. In the result, the defendant is excused from compliance with cl 2.2(b) of the Deed, and accordingly, is not in breach of that provision.

13. [191]

    Both parties agreed that there is an implied term at law to cooperate. The implied duty of cooperation refers to the cooperation required between all contracting parties to ensure that each party has the benefit of the contract: Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd (1979) 144 CLR 596 at 607 (per Mason J).

14. [192]

    The implied duty of cooperation, which was endorsed by the High Court in Commonwealth Bank of Australia v Barker [2014] HCA 32; (2014) 253 CLR 169 (per French CJ, Kiefel, Bell, Gageler and Keane JJ) was articulated in Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd (1979) 144 CLR 596 at 607-608; [1979] HCA 61 (per Mason J) as follows:

15. [193]

    In WIN Corporation Pty Ltd v Nine Network Australia Pty Ltd [2016] NSWCA 297 (per Barrett AJA, with whom McColl JA and Sackville AJA agreed), the NSW Court of Appeal referred to the implied duty to cooperate as follows (at [70] to [71]):

16. [194]

    I accept that there was an implied duty for the plaintiffs to cooperate with the defendant in respect of her obligations under cl 2.2(b) of the Deed.

17. [195]

    As I have previously found, the defendant raised the fact that she was unable to insure the property on the basis of not having an “insurable interest” in October 2023. The defendant then approached the plaintiffs in December 2023, with the intention of curing that impasse by having the plaintiffs take out the requisite insurance and invoicing the defendant for payment on a monthly basis. However, on all occasions, the plaintiffs refused to respond to the defendant’s difficulty and requests for cooperation.

18. [196]

    Hence, I accept that the plaintiffs failed to cooperate with the defendant in taking out insurance for the property, in circumstances where the defendant was unable to comply with the obligation in cl 2.2(b) of the Deed without such cooperation. In the result, the plaintiffs would be constrained in their reliance upon non-performance of cl 2.2(b) of the Deed, such that the relief of termination would not be available to them.

19. [197]

    I find that the defendant is in breach of cl 2.2(a) of the Deed as a result of the following circumstances, which have been proven on the evidence and fall within the remit of the defendant’s obligation to regularly maintain the property under the Deed:

    1. (1)

       A singular missing roof tile.

    2. (2)

       Overgrown gardens.

    3. (3)

       Front gate not connected to its hinge.

    4. (4)

       The replacement of a Perspex rather than glass window at the front of the house following heavy storms.

    5. (5)

       Dirty exterior walls.

20. [198]

    However, as I have earlier mentioned, the breaches of cl 2.2(a) of the Deed, being an intermediate term, are not sufficiently serious to warrant termination of the Deed.

21. [199]

    In any event, the plaintiffs have not demonstrated that they have suffered any loss, and to the extent that they have failed to cooperate, any loss they may have suffered, is of their own doing.

22. [200]

    Lastly, I find that the defendant has not breached cl 2.2(b) of the Deed. In any event, I find that equity would restrain the plaintiffs from relying upon a breach of cl 2.2(b) of the Deed in the circumstances that I have found existed, including the failure by the plaintiffs to cooperate in enabling the defendant to meet her obligations under that provision, and, the fact that the plaintiffs themselves have kept the property insured since settlement. In all the circumstances, the plaintiffs should not be granted the relief sought in the SOC.

23. [201]

    Hence, I answer the questions raised by 9(b), (c) and (d), respectively, as follows:

    1. (1)

       Yes.

    2. (2)

       No.

    3. (3)

       While it is not necessary to answer this question, I note that in any event, the plaintiffs would not be entitled to rely upon a breach of cl 2.2(b) to establish a basis for termination or recission of the Deed.

24. [202]

    I also answer the questions raised by question 10(a), (b) and (e) of the ASOI, respectively, as follows:

    1. (1)

       No.

    2. (2)

       Yes.

    3. (3)

       No.

25. [203]

    It is not necessary to answer the questions raised by question 10(c) and (d) of the ASOI.

Relief against forfeiture

1. [204]

   While it is not strictly necessary to pass upon the question of relief against forfeiture, having regard to the conclusions I have reached in my earlier consideration, I propose to nonetheless set out my conclusions in this regard, noting that it was the defendant’s case that if their primary argument was not accepted, they sought equitable relief in relation to the forfeiture of a sufficient interest.

2. [205]

   As I will find, if those principles were applied, the defendant must also be successful on that basis.

3. [206]

   The plaintiffs submitted that the defendant is not entitled to relief against forfeiture in circumstances where:

   1. (1)

      The defendant’s breach is serious and not trivial.

   2. (2)

      The cost of the necessary rectification works and/or ongoing maintenance are significant.

   3. (3)

      The defendant is not ready, willing or able to have any rectification works carried out, let alone any necessary rectification and/or ongoing maintenance works.

   4. (4)

      There has been no unconscionable or unconscientious conduct by the plaintiffs toward the defendant that would prevent them from insisting on their legal rights.

   5. (5)

      Any hardship, unfairness or adverse consequences that may be suffered by the defendant are due to the defendant’s conduct in circumstances where she was paid the agree purchase price.

   6. (6)

      The defendant has paid or divested her share of the sale proceeds to others without legal obligation to do so.

   7. (7)

      The plaintiff’s loss comprising the wasting and degrading of the dwelling on the property and the curtilages and/or having to meet the cost of insurance materially subverts the bargain struck by the parties who were legally represented at the time of the sale and entering into the Deed.

   8. (8)

      It would be inequitable to grant the defendant relief against forfeiture.

4. [207]

   I do not accept the arguments of the plaintiff, in this respect, as I consider that, if I was required to consider the matter, there is a substantial basis to find relief against forfeiture. I make that finding for the following reasons.

5. [208]

   First, forfeiture of the interest will deprive the defendant of the benefit of occupation of the property for life which was part of the consideration for the plaintiffs’ acquisition of the land such that the defendant will be homeless with no resources to obtain another residence.

6. [209]

   Secondly, the defendant sold the property to the plaintiffs on the condition that she would be able to reside there for life. She made financial and other decisions on this basis. If the defendant were to lose the right to live at the property after only 7 years from the date of the Deed, the defendant would be significantly disadvantaged.

7. [210]

   Thirdly, the defendant has lived in Balgownie for a large period of her life and has an important connection to the community. The defendant has no significant family or other supports outside of the Wollongong community. Further, the property has been in the defendant's family for a long time, having been previously owned by the defendant's mother. The defendant would face a significant loss in having to move out of her family home.

8. [211]

   Fourthly, in the absence of any other suitable housing options, the defendant will almost certainly become homeless given her financial circumstances.

9. [212]

   Fifthly, the defendant has multiple disabilities including colitis, severe depression, anxiety and chronic psoriatic arthritis. The defendant is a vulnerable individual and stable housing and accommodation is important, including in relation to the assistance and treatment of her disabilities.

10. [213]

    Sixthly, the impact of any homelessness would be profound and is very likely to exacerbate any medical conditions and mental health concerns.

11. [214]

    Seventhly, as to the question of insurance, the property has been continuously insured. I do not agree with the plaintiffs’ submission that there has been no unconscionable or unconscientious conduct by the plaintiffs that would prevent them from insisting on their legal rights. That submission is at odds with the plaintiffs’ behaviour, as I have found it, with respect to their failure to cooperate with the defendant. In my view, the plaintiffs’ conduct, in that respect, did prevent the defendant from insisting on her legal rights.

12. [215]

    Eighthly, as to the question of maintenance, I do not accept the plaintiffs’ submission that the defendant’s breach was serious or, on the evidence, that the cost of rectification works and/or ongoing maintenance were significant. In my view, if the breaches are proved they are readily capable of rectification by the expenditure of a modest amount of gardening and handyman work at relatively low cost compared to the value of the interest which the plaintiffs seek to forfeit.

13. [216]

    Ninthly, I do not accept the contention that the defendant is not ready, willing or able to have any rectification works carried out, let alone any necessary rectification and/or ongoing maintenance works. The defendant’s willingness to engage in the relevant maintenance works is evidenced in her communications with the plaintiffs’ solicitor, where she seeks clarification as to what Mr Memik required in relation to maintenance work. I also note, as I have found, that the defendant has regularly engaged a lawn mowing service since October 2021, and accept her evidence that she did in fact undertake other maintenance tasks, such as removing trees, clearing overgrowth, and pruning trees and hedges. The defendant’s willingness to engage with these tasks previously, is, in my view, evidence that she is ready, willing and able to perform her obligations under the Deed.

14. [217]

    Lastly, I do not accept, as was submitted for the plaintiffs, that any hardship, unfairness or adverse consequences that may be suffered by the defendant are due to the defendant's conduct, in circumstances where she was paid the agreed purchase price. As I have previously found, the equitable interest granted to the defendant formed part of the consideration for the transfer of the property to the plaintiffs. Further, in my view, as I have previously found, it is unlikely the contract for sale (at a purchase price of $600,000) would have proceeded without the grant of the life estate to the defendant.

15. [218]

    In the result, I answer both questions 11 and 12 in the affirmative.

CONCLUSION

1. [219]

   The Court has found breaches with respect to cl 2.2(a) of the Deed, although the breaches found are narrower in scope than contended for by the plaintiffs and not of a nature and seriousness as would ground the relief of termination sought by the plaintiffs.

2. [220]

   Clause 2.2(a) of the Deed is an intermediate term, and the nature and seriousness of the breaches were not such as to constitute a basis for relief by termination.

3. [221]

   As to cl 2.2(b) of the Deed, the primary finding of the Court is that the defendant did not breach that intermediate term. In any event, the nature and seriousness of any non-performance by the defendant could not constitute a basis for the termination of the Deed. In all relevant respects, any failure to take out insurance by the defendant was a product of the plaintiffs’ own conduct.

4. [222]

   Furthermore, the Court has found that, in all the circumstances, the defendant has available relief against forfeiture. However, relief against forfeiture would necessarily be dependent upon appropriate conditions, having regard to the need for maintenance in various areas, discussed at [197].

5. [223]

   Neither party addressed the Court as to the appropriate form of relief. In those circumstances, I will give the parties a limited opportunity to make submissions with respect to the appropriate relief in light of this judgment and in accordance with the orders and directions made by the Court in this judgment.

6. [224]

   Notwithstanding that the Court has rejected the primary form of relief sought by the plaintiffs, the defendant has not been entirely successful in her defence of the SOC. If the Court were assessing costs on that basis, the preliminary view would be that the plaintiffs would pay 70% of the defendant’s costs on an ordinary basis, as agreed or assessed. The parties shall have the opportunity to address the question of costs in submissions made in conformity with the orders and directions of the Court in this judgment.

ORDERS AND DIRECTIONS

1. [225]

   The Court makes the following orders and directions:

   1. (1)

      The defendant shall file and serve Short Minutes of Order reflecting this judgment, together with a submission in support thereof, not exceeding 3 pages in length, on or before 4pm on Monday, 1 December 2025.

   2. (2)

      The plaintiffs shall file and serve any submissions in reply by 4pm on Wednesday, 3 December 2025.