Lawrence v Gunner; Gunner v Lawrence

The plaintiffs, Mr Wayne and Mrs Valerie Lawrence, are husband and wife. Mrs Lawrence is the identical twin sister of the defendant, Mrs Frances Gunner.

In or about November 1990, Mr Lawrence introduced Mrs Gunner (then known as Ms Frances Sanders) to Mr Norman Gunner. Mr and Mrs Gunner commenced living together in or about December 1990. They were married on 21 August 1999.

Mr Gunner died on 17 March 2009.

Mr Gunner had been a property developer and investor since about 1943. At the time of his death he owned over one hundred properties in Sydney and regional New South Wales, some of which he had purchased as long ago as 1950. On the date of his death, those properties were worth something in the order of $10 million.

Mrs Gunner gave evidence that she understood, from what Mr Gunner had told her, that Mr Gunner had always acted alone; that is, never with a partner.

During their 19 years together, Mr Gunner also arranged for some properties to be purchased in Mrs Gunner's name. One of those properties was a property at Tinonee. That property was purchased in 1998. It was Mr and Mrs Gunner's home from that date until Mr Gunner died, and remains Mrs Gunner's home to this day.

Included in Mr Gunner's property portfolio were the following:

The Old Bar, Beecroft, Mt Colah and 132 Clontarf Street properties were vacant land at the date of Mr Gunner's death.

There is a house erected on 134 Clontarf Street. Mr Gunner lived in that house from the time he purchased it in 1988 until 1993. From December 1990, Mrs Gunner also lived there. Thereafter, the house was vacant for some time. It was then occupied by a tenant, Ms Glynis Conlon. In the circumstances I describe below, Mr and Mrs Lawrence moved into the 134 Clontarf Street property in September 2006. They have lived there since, rent free, and assert an entitlement to remain in occupation “for as long as they want”. By her cross-claim, Mrs Gunner seeks (amongst other things) possession of that property.

On or about 21 January 1998, Mr and Mrs Gunner made mutual wills, appointing the other as both sole executor or executrix and sole beneficiary. Those wills were revoked by Mr and Mrs Gunner's marriage in August 1999. Accordingly, Mr Gunner died intestate.

On 10 December 2009, this Court granted letters of administration to Mrs Gunner in respect of Mr Gunner's estate. By a transmission application lodged with Land and Property Information NSW in February 2010, all of the real estate previously registered in the name of Mr Gunner (including the five properties referred to above) was transferred to Mrs Gunner.

In the circumstances I describe below, Mrs Gunner sold the Beecroft property by contracts exchanged in February 2011 and eventually settled (after some dispute) in February 2012. Mrs Gunner sold the 132 Clontarf Street property by contracts exchanged in March 2011 and settled in May 2011. Mrs Gunner sold the Mt Colah property in mid 2014. She remains the registered proprietor of the Old Bar and 134 Clontarf Street properties.

By their amended statement of claim, Mr and Mrs Lawrence claim that "in or about 2004" Mr Lawrence and Mr Gunner made agreements in relation to each of the Old Bar, Beecroft, Mt Colah, 132 Clontarf Street and 134 Clontarf Street properties. Each of the agreements is alleged to have been made "in conversations" between Mr Lawrence and Mr Gunner at Mr and Mrs Gunner's home at Tinonee.

For convenience, I will refer to these alleged agreements as the "Old Bar Agreement", the "Beecroft Agreement", the “Mt Colah Agreement", the "132 Clontarf Street Agreement" and the "134 Clontarf Street Agreement". I do not mean to suggest, by adopting this language, that I accept that any such agreements were made between Mr Lawrence and Mr Gunner. Indeed, for the reasons I set out below, I do not.

Mr and Mrs Lawrence also claim an entitlement to occupy 134 Clontarf Street on the basis of a letter sent to them by Mrs Gunner on 27 January 2012, and an alleged conversation with Mrs Gunner on 18 March 2009.

I will deal with each of these agreements in turn.

As to the Old Bar property, Mr and Mrs Lawrence plead that "in or about 2004" Mr Lawrence and Mr Gunner "made an agreement" that:

Mr Lawrence alleged that he and Mr Gunner had the following conversation concerning Old Bar in late 2004:

As to the Beecroft property, Mr and Mrs Lawrence plead an agreement made "in or about 2004" to the same effect as the Old Bar Agreement, with the value of the property agreed to be $1.2 million for the purpose of calculating the "profits of the venture". Under this alleged agreement, Mr Lawrence was to receive one lot (rather than two lots) from the subdivision and would also assist Mr Gunner in defending a claim brought against Mr Gunner by the owner of neighbouring land (a Mr Neil Handley).

Mr Lawrence gave evidence of the following conversation with Mr Gunner concerning the Beecroft property which occurred “prior to 5 March 2005”:

As to the Mt Colah property, Mr and Mrs Lawrence plead an agreement made "in or about 2004" to the same effect as the Old Bar Agreement, with Mr Lawrence to obtain two lots from the subdivision and the agreed value of the Mt Colah property to be $1.8 million.

Mr Lawrence gave evidence of the following conversation with Mr Gunner, which also occurred "prior to 5 March 2005":

As to the 132 Clontarf Street property, Mr and Mrs Lawrence plead an agreement made "in or about 2004" to the same effect as the Old Bar Agreement, save that Mr Lawrence was to obtain one lot (being “lot 1” facing Clontarf Street) with the agreed value of the property to be $2 million.

Mr Lawrence gave evidence of the following conversation with Mr Gunner, which he said occurred "in the second half of 2004":

Mr and Mrs Lawrence plead a further agreement, again made orally between Mr Lawrence and Mr Gunner "in or about 2004", concerning 134 Clontarf Street as follows:

Mr Lawrence gave evidence of the following conversation with Mr Gunner "in the second half of 2004":

Mr Lawrence said he made enquiries as to how to evict the tenant and "reported back" to Mr Gunner, who then said words to the effect "please take steps for the tenant to be evicted".

Mr Lawrence said he then had a conversation with Mr Gunner as follows:

Mrs Lawrence alleged that, at around this time, she had the following conversation with Mrs Gunner:

Mrs Gunner disputes the existence of any of these agreements and disputes that she had the conversation alleged by Mrs Lawrence.

Mr and Mrs Lawrence also claim an entitlement to occupy 134 Clontarf Street by reason of an agreement said to be constituted in a letter sent by Mrs Gunner to them on 27 January 2012. I discuss the events of 27 January 2012 below (at [259] to [268]).

Mr and Mrs Lawrence claim that they entered into a further agreement with Mrs Gunner on 18 March 2009; the day after Mr Gunner died.

Mr and Mrs Lawrence plead that alleged agreement as follows:

Mrs Gunner denied making any such agreement with Mr and Mrs Lawrence.

Mr and Mrs Lawrence claim damages for breach of contract on the basis of each of the Old Bar, Beecroft, Mt Colah, 132 Clontarf Street and 134 Clontarf Street Agreements, and/or equitable compensation in respect of the “subdivision developments” that have been sold by Mrs Gunner (the Mt Colah, Beecroft and 132 Clontarf Street properties). Mr and Mrs Lawrence also seek a “constructive trust in respect of” the Old Bar property “or alternatively equitable compensation”.

They also seek specific performance of the alleged 27 January 2012 agreement concerning 134 Clontarf Street; namely, that Mrs Gunner transfer that property to Mrs Lawrence.

Mr and Mrs Lawrence further allege that upon Mr Gunner's death "or upon the grant of probate [sic]" to Mrs Gunner:

Mr and Mrs Lawrence allege:

Section 45 of the Probate and Administration Act 1898 (NSW) is in the following terms:

Mrs Gunner disputes that any of the properties was the subject of any trust or equity in favour of Mr Lawrence, and thus that s 45 of the Probate and Administration Act is relevant to the issues in these proceedings. For the reasons I discuss below (see [409] and [410]), I agree.

Mr and Mrs Lawrence commenced these proceedings by statement of claim filed on 5 September 2012. Earlier that year, on 21 February 2012, Mrs Gunner commenced proceedings against Mr and Mrs Lawrence in the Consumer, Trader and Tenancy Tribunal (“CTTT”) seeking possession of the 134 Clontarf Street property. On 12 September 2012, following commencement of these proceedings, and with the consent of Mr and Mrs Lawrence, the CTTT proceedings were transferred to this Court to be heard with and abide the outcome of these proceedings.

When the proceedings commenced, Mr and Mrs Lawrence were represented by Mr Charles Hockey, solicitor, who had also appeared for them in the CTTT.

On 27 June 2013 Mr Hockey filed a notice of ceasing to act. Thereafter, until very shortly before the commencement of the hearing before me on 24 November 2014, Mr and Mrs Lawrence were self-represented. Mr Lawrence appeared on his own and Mrs Lawrence’s behalf on various interlocutory applications before the Court.

In late March 2014, the Chief Judge in Equity asked me to case manage the proceedings. On 3 April 2014, I set the matter down for hearing before me commencing 24 November 2014. Thereafter, the proceedings were listed before me regularly. On those occasions, Mr Lawrence appeared for himself and Mrs Lawrence, and Mr Hourigan of counsel appeared for Mrs Gunner.

Several days before hearing commenced, Mr and Mrs Lawrence served an “Outline of Submissions”. By then, they were represented by Mr Kingsley Liu of The People’s Solicitors. Although Mr Liu signed the Outline of Submissions, they were prepared by Mr and Mrs Lawrence themselves. Indeed, the document concluded with the statement “prepared by the Plaintiffs, and signed by their solicitor”.

At around that time, Mr Collins QC (who appeared with Mr Hourigan for Mrs Gunner at the hearing) circulated opening submissions on behalf of Mrs Gunner. In those submissions, Mr Collins said that “the whole of Mr Lawrence’s extravagant story is in issue in these proceedings”.

When the proceedings were called on for hearing on 24 November 2014, Mr King, of counsel, appeared (for the first time) for Mr and Mrs Lawrence.

Mr Collins cross-examined Mr Lawrence for the best part of five days.

It was clear from the tone and length of that cross-examination that, indeed, Mr Lawrence’s credit, and evidence generally, was in issue.

Mr Collins did not, however, put to Mr Lawrence in terms that the conversations he said he had with Mr Gunner, said to give rise to the Old Bar, Mt Colah, Beecroft, 132 Clontarf Street and 134 Clontarf Street Agreements, did not take place.

The rule of practice known as the rule in Browne v Dunn (1893) 6 R 67 (HL) is a rule of fairness requiring that “if a court is to be invited to disbelieve a witness, the grounds upon which the evidence is to be disbelieved should be put to the witness in cross-examination so that the witness may have an opportunity to offer an explanation” (J D Heydon, Cross on Evidence, (Looseleaf Edition, LexisNexis Butterworths) at [17435]).

In Allied Pastoral Holdings Pty Ltd v Commissioner of Taxation [1983] 1 NSWLR 1, Hunt J (as his Honour then was) said of the relevant practice at 22 to 23:

In this case, the second and third matters to which Hunt J referred do not arise. Mr Lawrence’s position was that there were no witnesses to his conversations with Mr Gunner. He was therefore not in a position to call corroborative evidence or to fear direct contradiction of what he claimed Mr Gunner had said.

Further, the rule of practice does not apply “where the witness is on notice that the witness’s version is in contest”. Such notice can come from the other side’s opening or the “general manner in which the case is conducted” (Cross on Evidence at [17445] (citations omitted)).

No fair reader of Mr Collins’s cross-examination could accuse him of being “willing to wound, and yet afraid to strike” (per Wells J in Reid v Kerr (1974) 9 SASR 367 at 374, adopting the language of Alexander Pope).

Mr Collins could not have the benefit of instructions from Mr Gunner as contradictor to Mr Lawrence’s account of events. In all the circumstances, I do not see that any unfairness was caused to Mr Lawrence by reason of the course that Mr Collins took.

The critical questions for me to determine in these proceedings are whether, as Mr Lawrence contends, he entered the Old Bar, Beecroft, Mt Colah, 132 Clontarf Street and 134 Clontarf Street Agreements with Mr Gunner and whether, as both Mr and Mrs Lawrence claim, they entered the further agreement with Mrs Gunner on 18 March 2009.

An examination of the objectively established course of events points to the high improbability of the existence of the agreements with Mr Gunner for which Mr Lawrence contends; or, alternatively, to the conclusion that Mr Lawrence has never had a genuine belief that whatever conversations took place in or around 2004 formed the basis of any partnership, joint venture or other agreement which provided a foundation for any legal entitlements on his part.

Leaving aside the objective improbability of Mr Lawrence’s case, many of the events that occurred prior to and over the course of proceedings reflect adversely on his credit, as well as that of Mrs Lawrence. An understanding of why that is so is best revealed by an examination of the events themselves. For that reason, I will defer detailed analysis of Mr and Mrs Lawrence’s credit until after consideration of the course of events.

I record at this stage of the judgment however that, unlike Mr and Mrs Lawrence, I found Mrs Gunner to be a calm, credible and reliable witness. Mr and Mrs Lawrence gave evidence of numerous events and conversations that Mrs Gunner disputed. There were many inconsistencies between the evidence given by Mr and Mrs Lawrence, and also Mrs Lawrence’s daughter, Ms Sara Pearson, on the one hand, and the corresponding evidence given by Mrs Gunner on the other; very often in circumstances where the witnesses could not have been mistaken about what really happened. For reasons which will emerge from my discussion of what occurred, my conclusion is that to the extent that there is any inconsistency between the evidence given by Mr Lawrence, Mrs Lawrence or Ms Pearson on the one hand, and Mrs Gunner on the other, I should prefer Mrs Gunner’s evidence.

Thus, in what follows, where I set out Mrs Gunner’s recollection of events and conversations, I prefer that recollection to the recollections of Mr and Mrs Lawrence and Ms Pearson, to the extent that they differ from that of Mrs Gunner. Because of the overall view I have come to as to the credibility and reliability of the evidence given by Mr and Mrs Lawrence, and to a lesser extent Ms Pearson, I do not find it necessary to address, separately, each and every one of these inconsistencies.

I will deal with the credit of each of Mr and Mrs Lawrence, Ms Pearson and Mrs Gunner further below (see [328] to [398]).

Leaving aside questions of credit and of improbability arising from Mr and Mrs Lawrence’s conduct after Mr Gunner died, there are other aspects of Mr and Mrs Lawrence’s claim which cause me to approach their case with caution.

The plaintiffs' case depends, entirely, on acceptance of Mr Lawrence's evidence concerning his conversations with Mr Gunner. The agreement he alleges he reached with Mrs Gunner on 18 March 2009 to "continue on the same as your agreements with Norm" is contingent on there being, in fact, an agreement with Mr Gunner that could be "continued" (leaving aside, for the moment, any other difficulties that may be associated with this part of the plaintiffs' case).

Mr Lawrence did not assert the existence of any of the Old Bar, Beecroft, Mt Colah, 132 Clontarf Street or 134 Clontarf Street Agreements until May 2012 (that is, more than three years after Mr Gunner's death), and only then in the course of the proceedings commenced by Mrs Gunner in the CTTT to which I have referred.

There is no note or memorandum of the alleged agreements. There is no alleged witness to the agreements. Each agreement is alleged to have been made orally between Mr Lawrence and Mr Gunner “in or about 2004”, in conversations at Mr and Mrs Gunner's Tinonee home when both Mrs Lawrence and Mrs Gunner were either “in the kitchen” or “out of the house on a walk”. Initially, Mr Lawrence's evidence was that Mrs Gunner knew nothing of Mr Lawrence's alleged agreements with Mr Gunner (although, in cross-examination, when the implications of this evidence were explored, Mr Lawrence sought to retreat somewhat from this position. I deal with this further below).

Thus, there can be no direct contradictor of Mr and Mrs Lawrence’s case.

At the time of the alleged agreements, Mr Gunner was 80 years of age and, to Mr and Mrs Lawrence's knowledge, seriously unwell with a limited life expectancy. Mr Gunner was diagnosed with chronic lymphatic leukaemia in late 2002 and was, by 2004, unwell and suffering severe hearing problems.

Mr Lawrence gave no evidence of having made any complaint between 2004 and Mr Gunner's death in 2009 concerning inactivity by Mr Gunner in relation to the developments the subject of the alleged agreements, nor of having had any communication at all with Mr Gunner in that period concerning the progress of any of the developments.

There is no evidence that Mr Lawrence ever described himself to any outside person as a partner or joint venturer of Mr Gunner. Although Mr Lawrence kept a detailed diary recording daily activities, he made no contemporaneous mention in that diary of any agreement with Mr Gunner. There is no evidence of any partnership account or formal record of any work done by Mr Lawrence as a partner, nor of any funds allocated to or monies borrowed for the subdivisions the subject of the alleged agreements. Mr Lawrence made no claim on Mr Gunner's estate.

In these circumstances, authority, and indeed common sense, requires that, quite apart from any questions of credit, Mr and Mrs Lawrence’s case be examined with great care: see the cases summarised by Hallen J in Fulton v Fulton [2014] NSWSC 619 at [117] to [125].

As I have mentioned, Mr Lawrence claims that his agreements with Mr Gunner were made “in or about 2004”.

Mr King pointed to three circumstances which, he submitted, pointed to the probability of Mr Gunner entering into agreements with Mr Lawrence of the kind alleged at that time.

They were:

I will deal with these matters in turn.

Prior to 2004, Mr Gunner and Mr Lawrence did have some property dealings. However, none of those dealings could be described as a partnership, and none involved the subdivision of property. As I have said, Mrs Gunner’s evidence was that she understood from Mr Gunner that he never acted with partners (see [5] above).

In or about 1992, Mr Lawrence and Mr Gunner had effected what the parties described as a “land swap” whereby Mr Lawrence transferred to Mr Gunner a property he owned at Gloucester in exchange for a property Mr Gunner owned in North Balgowlah. That transaction involved no work, input or joint profit to either Mr Lawrence or Mr Gunner.

Mr King submitted that, in 1998, there had been a “property deal” between Mr Gunner, Mr Lawrence, and Mr Lawrence’s son, Mr David Lawrence. Whatever that “deal” was, it resulted in Mr Lawrence suing Mr Gunner for $38,000, claiming that he and his son had in 1997 painted the inside of the house at 134 Clontarf Street and carried out other significant work.

Mr King also submitted that there was evidence of an agreement between Mr Lawrence and Mr Gunner concerning a development in Seaforth. However, Mrs Gunner’s evidence, which I accept, was that the only thing that Mr Lawrence did in respect to that property was to make a telephone call to a surveyor involved in the project.

I do not find that these circumstances point to the probability of the correctness of Mr Lawrence’s case.

Mrs Gunner gave evidence that Mr Gunner was diagnosed with leukaemia in October or November 2002. She said she told Mrs Lawrence of that diagnosis on the same day.

That evidence is inherently probable. It was common ground that Mrs Gunner and Mrs Lawrence, as identical twin sisters, were extremely close at around this time and spoke on the telephone on a daily basis (and often several times a day). It seems very likely that, as she says, Mrs Gunner passed on to her sister the very serious news of her husband’s affliction with leukaemia as soon as she knew of it.

However, Mr King submitted that:

Thus, Mr King submitted that the revelation of Mr Gunner’s illness in “late 2003” provided an explanation for Mr Gunner entering into the agreements with Mr Lawrence “in or about 2004” of the kind alleged.

This submission was evidently based on Mrs Lawrence’s evidence that when Mrs Gunner told her of Mr Gunner’s illness, Mrs Gunner said:

Mrs Gunner denied making this statement to her sister.

In cross-examination, Mrs Lawrence said Mrs Gunner told her of Mr Gunner’s condition in May 2003 (not, as Mr King submitted, in “late 2003”).

I do not accept this evidence. I see no reason to doubt Mrs Gunner’s evidence that she learned of Mr Gunner’s leukaemia diagnosis in October or November 2002, nor that she told her sister immediately.

In those circumstances, the timing of that revelation provides no support for Mr Lawrence’s contention that he entered into the relevant agreements with Mr Gunner in around 2004.

Mr King submitted that, following revelation of Mr Gunner’s medical condition, Mr and Mrs Lawrence moved from their then residence at Braemar and lived for two years at the “Blue House” (on a property adjacent to Mr and Mrs Gunner’s residence at Tinonee).

Mr King submitted that this pointed to the probability of the existence of the agreements for which Mr Lawrence contended as, he submitted, there was no other reason why Mr and Mrs Lawrence would take up full time residence in the Blue House.

Mr and Mrs Gunner did rent the property at 67 Beauly Road, Tinonee, on which the Blue House was erected, from December 2004.

Mrs Gunner gave the following evidence:

I accept that evidence. Mr and Mrs Lawrence’s occasional occupation of the Blue House provides no support for Mr Lawrence’s contentions.

For those reasons, I do not consider that any of the three circumstances to which Mr King pointed offer any support for the existence of the alleged agreements.

As I have set out above, Mr Lawrence alleges that "in the second half of 2004" he entered into the 134 Clontarf Street Agreement with Mr Gunner, pursuant to which he and Mrs Lawrence could stay there “for as long as they want".

On 9 February 2005, Mr Lawrence wrote a letter to the CTTT "[a]cting as Power of Attorney for Norman Gunner". The letter sought an urgent hearing for Mr Gunner's application for an order that the then tenant, Ms Conlon, vacate the property.

Mr Lawrence stated that before sending letters to the CTTT he asked Mr Gunner to "sign off on them".

Mr Lawrence's letter includes:

On 29 March 2005, Mr Lawrence, again acting as "Power of Attorney for Norman Gunner", wrote to the "Tenant Advocate" acting for Ms Conlon as follows:

The clear import of these letters is that Mr Gunner required possession of the 134 Clontarf Street property, described as "his only home in Sydney", for his own use.

Mr Collins submitted this to be irreconcilable with Mr Lawrence’s claim to have entered into the 134 Clontarf Street Agreement “sometime in 2004” because an element of that alleged agreement was that Mr and Mrs Lawrence would have life tenure at 134 Clontarf Street; whereas the above correspondence asserted that Mr Gunner required possession of the same property for his own use.

However, by February 2005, Mr and Mrs Gunner had been living at the Tinonee property for some six years. Mrs Gunner did not suggest in her evidence that, in February 2005, she and Mr Gunner were planning to move to 134 Clontarf Street on a full time basis (although Mrs Gunner did say that Mr Gunner said “we may have to move back [into 134 Clontarf Street] to deal with my illness”). It may be that Mr Gunner asked Mr Lawrence to assert to the CTTT that Mr Gunner wished to move back to 134 Clontarf Street as a ploy to evict the tenant. As Mr Collins accepted in final submissions, it may be that Mr Gunner was “putting his best foot forward”.

For those reasons, I do not think that Mr Lawrence’s correspondence of February and March 2005 is, itself, necessarily inconsistent with his claims concerning the 134 Clontarf Street Agreement.

So far as concerns Mr and Mrs Lawrence’s occupation of 134 Clontarf Street, Mrs Gunner gave a very different account of events to that given by Mr and Mrs Lawrence (set out at [26] to [29] above). For the reasons I have set out above, I prefer Mrs Gunner’s account of events.

Mrs Gunner said that from about mid 2005 Mrs Lawrence frequently asked her whether Mr Gunner would permit Mr and Mrs Lawrence to move into 134 Clontarf Street.

At that stage, Mr and Mrs Lawrence were living in a property that they owned in Davidson, together with Ms Pearson and her husband Darryl Pearson.

Mrs Gunner said that Mrs Lawrence stated:

Initially Mr Gunner refused, saying:

Mr Gunner's reference to his "earlier dealings and difficulties with Wayne and David" was evidently a reference to the dispute which had arisen earlier in relation to work performed by Mr Lawrence's son (see [78] above).

Nonetheless, Mrs Lawrence persisted with her request that Mr Gunner permit she and Mr Lawrence to move into 134 Clontarf Street.

In late 2005 or early 2006 Mr Gunner relented and, according to Mrs Gunner, said to her:

Mrs Gunner then telephoned Mrs Lawrence and that the following conversation took place:

Mr and Mrs Lawrence moved into 134 Clontarf Street in or about September 2006. As I have said, they remain in occupation of the property and, by reason of the 134 Clontarf Street Agreement, assert an entitlement to continue to reside in the property, rent free, for life.

Mrs Gunner said that in about March or April 2007 Mrs Lawrence telephoned Mrs Gunner and the following conversation took place:

Mrs Gunner then had the following discussion with Mr Gunner:

Mrs Gunner said that Mr Gunner prepared a lease but Mr and Mrs Lawrence refused to sign it. Mrs Lawrence said to her:

Mr Gunner died on 17 March 2009, after a long illness.

Much time at the hearing was spent on the question of what role Mrs Gunner played in Mr Gunner’s death. Mr and Mrs Lawrence, and Ms Pearson, claimed that Mrs Gunner deliberately delayed calling the ambulance which, ultimately, transported Mr Gunner to the Manning Rural Referral Hospital where he died. That matter is not relevant to any issue in the proceedings other than the question of the credit of Mr and Mrs Lawrence and Ms Pearson. I deal with that matter later in these reasons (see [332] to [336] below).

For the moment, I will simply record that Mr Gunner was admitted to the Manning Rural Referral Hospital at 4.45pm on 13 March 2009. He died at the hospital at 8.15pm on 17 March 2009.

As I have mentioned, Mr and Mrs Lawrence allege that the very next day, Mrs Gunner asked Mr Lawrence to "continue the work" that Mr Gunner had "asked" Mr Lawrence to do in relation to the Old Bar, Beecroft, Mt Colah and 132 Clontarf Street properties.

Mr Lawrence gave evidence that:

Mrs Lawrence gave a similar account.

Mrs Gunner denied saying anything to this effect.

She said, and I accept, that although Mr and Mrs Lawrence did arrive at Tinonee on 18 March 2009, only Mrs Lawrence came into the house. Mrs Gunner said:

That being so, the statement that Mr and Mrs Lawrence assert Mrs Gunner made to Mr Lawrence could not have been made.

A further difficulty with this aspect of Mr and Mrs Lawrence's case is that it was Mr Lawrence’s contention that, during Mr Gunner's life, Mrs Gunner was not told of the alleged arrangements between Mr Lawrence and her late husband.

In their Outline of Submissions of 19 November 2014 (which, as I have stated, was prepared by the plaintiffs themselves and, for some reason, signed by their solicitor) the plaintiffs said:

In an affidavit Mr Lawrence swore:

Later in the same affidavit Mr Lawrence said:

In a later affidavit, Mr Lawrence said:

In cross-examination, Mr Collins took Mr Lawrence to the passage I have set out at [130]. The cross-examination continued:

Later Mr Lawrence said:

When asked about the passage I have set out at [131] Mr Lawrence said:

This evidence provides an example, in my opinion, of Mr Lawrence’s preparedness to give such evidence as he thought would advance his case at a particular time. He first asserted that Mrs Gunner was ignorant of his alleged arrangements with Mr Gunner, no doubt to eliminate Mrs Gunner as a potential contradictor. When confronted with the tension between that position and his assertion that on 18 March 2009 Mrs Gunner asked him to “continue” those arrangements (implicit in which assertion was the proposition that Mrs Gunner did know of the arrangements), he was forced to dissemble.

Mr Collins put this aspect of the matter to Mr Lawrence in cross-examination:

I do not accept Mr or Mrs Lawrence’s evidence about the events of 18 March 2009, and in particular that Mrs Gunner said anything to the effect alleged by Mr and Mrs Lawrence. This is significant in light of the emphasis placed by Mr and Mrs Lawrence on the alleged events of 18 March 2009.

Mrs Gunner gave evidence that shortly after Mr Gunner’s death, she said to Mrs Lawrence:

As I have said, letters of administration in respect of Mr Gunner's estate were granted to Mrs Gunner on 10 December 2009. By late February 2010, all of the properties formerly registered in Mr Gunner’s name had been transferred into the name of Mrs Gunner.

In January 2010, Mrs Gunner engaged Mr Robert Chapman, the principal of the Ray White franchise in Taree, to manage her properties.

Mrs Gunner later appointed Mr Chapman to be her enduring guardian. I will return to this below.

Mrs Gunner gave evidence, which I accept, that between March and June 2010, Mrs Lawrence told her on numerous occasions:

At around this time, Mr Lawrence, in telephone calls between Mrs Lawrence and Mrs Gunner, offered to engage a firm of surveyors, Rygate & Company Pty Ltd, to survey some of Mrs Gunner’s properties, including the Beecroft property. Mrs Gunner accepted this offer.

In May 2010, Beecroft was put to auction. The property was passed in at $450,000.

In July 2010, Mrs Gunner agreed to allow Mr Lawrence to take over marketing of the properties. She said, and I accept:

In cross-examination, Mr Lawrence accepted that at around this time, he had taken over from Mrs Gunner as the first point of contact in relation to the sale of the various properties owned by Mrs Gunner, including Beecroft.

Mrs Gunner called Mr Dennis Mirosevich to give evidence.

Mr Mirosevich is a property developer who had dealings with Mr Lawrence concerning the Beecroft property. Mr Mirosevich impressed me as an honest witness. He presented as deeply aggrieved by the conduct of Mr Lawrence, but also of Mrs Gunner (concerning Mrs Gunner's rescission of a contract to sell the Beecroft property to a company, SLN Developments Pty Ltd, in which Mr Mirosevich and his wife were shareholders. I will return to this below). In the witness box, he was deeply critical of his treatment, as he saw it, at the hands of both Mr Lawrence and Mrs Gunner, and deeply upset at the predicament in which such conduct had placed him. Nonetheless, I have no reason to doubt that his account of his dealings with Mr Lawrence was truthful and accurate.

Mr Mirosevich and Mr Lawrence had had commercial dealings concerning a property at Magnus Street, Nelson Bay. That property was owned by Minsden Pty Ltd, a company associated with Mr Lawrence. At some time in 2008, a company associated with Mr Mirosevich, Dennis Homes Pty Ltd, contracted to purchase the Nelson Bay property from Minsden for $900,000.

Mr Mirosevich also had dealings with Mr Lawrence in early 2010. Mr Mirosevich was working for Ray White Real Estate in Port Stephens at that time. That firm acted for Mr Lawrence in relation to the sale of a property Mr Lawrence owned or had an interest in.

In September 2010 Mr Lawrence asked Mr Mirosevich for his opinion of the Beecroft property. Mr Lawrence said to Mr Mirosevich:

Mr Mirosevich considered the matter and told Mr Lawrence that he thought the Beecroft property "was likely to be worth $1.5 million".

Mr Mirosevich subsequently became aware that the Beecroft property was owned by Mrs Gunner. Shortly thereafter he had this conversation with Mr Lawrence:

In or about October 2010, Mrs Lawrence telephoned Mrs Gunner. The following conversation took place:

In November 2010 Mr Mirosevich arranged for a Mr Ian Lazar from Tripod Funds Management Pty Ltd to commission Alcon Lupton & Associates to conduct a valuation of the Beecroft property. Alcon Lupton & Associates provided a valuation dated 23 November 2010 which assessed the value of the Beecroft property at $1.5 million. Both Mr Mirosevich and Mr Lawrence received a copy of the valuation.

Between October and December 2010 Mrs Gunner regularly asked Mrs Lawrence how Mr Lawrence's negotiations for the sale of the Beecroft property were progressing. Mrs Lawrence replied saying words to the effect:

In about December 2010, Mrs Lawrence telephoned Mrs Gunner and said:

A short time later, in January 2011, Mr Lawrence came to Mr Mirosevich's office and the following conversation took place:

Shortly thereafter Mr Mirosevich again suggested to Mr Lawrence that a joint venture be undertaken between he, Mr Lawrence and Mrs Gunner.

The following conversation then took place between Mr Mirosevich and Mr Lawrence:

Mr Mirosevich said that he and Mr Lawrence then:

The “Minutes of Meeting” of 21 January 2011 prepared by Mr Mirosevich recorded an agreement between Mr Lawrence and Mr Mirosevich that:

In late January 2011, Mrs Lawrence telephoned Mrs Gunner and told her that Mr Lawrence "had negotiated a deal to sell the Beecroft property". The following conversation took place:

On 2 February 2011 Mr and Mrs Lawrence acquired a total of 51 per cent of the shares in SLN Developments.

The following day, 3 February 2011, Mrs Gunner exchanged contracts with SLN Developments to sell it the Beecroft property for $600,000. The contract provided for settlement 12 months later, on 3 February 2012, and for SLN Developments and its representatives to have "full access to the property to prepare for a Development Application".

Mr and Mrs Lawrence did not inform Mrs Gunner of their shareholding in SLN Developments. Mrs Gunner did not become aware of their shareholding until mid 2011, in the circumstances I set out below.

Thus, Mr and Mrs Lawrence encouraged Mrs Gunner to sell Beecroft to a company in which they held a 51 per cent shareholding without disclosing that interest to Mrs Gunner and, so far as Mr Lawrence is concerned, without making any assertion of the existence of the Beecroft Agreement.

Further, Mr Lawrence (through Mrs Lawrence) advised Mrs Gunner to sell Beecroft to “Dennis” for $600,000 when he knew it had been valued at $1.5 million (albeit subject to Mr Mirosevich’s qualification at [158]).

I find Mr Lawrence’s conduct in coming to this arrangement with Mr Mirosevich to be irreconcilable with him having a genuine belief in the existence of the Beecroft Agreement. If Mr Lawrence believed he was entitled to enforce the Beecroft Agreement, he would surely have asserted that right to Mrs Gunner. Instead, he told Mr Mirosevich that Mrs Gunner needed to sell Beecroft to meet a tax obligation, thus implicitly accepting, indeed asserting, Mrs Gunner’s entitlement to the property. And he then sought to profit from the Beecroft land, not by asserting the existence of the Beecroft Agreement but, rather, by secretly (so far as Mrs Gunner was concerned) taking a 51 per cent interest (taking account of Mrs Lawrence’s shareholding) in the purchase of it.

This was shabby conduct on the part of Mr Lawrence. It reflects badly on his credit. It points to the high improbability of his case concerning the Beecroft Agreement. It is also the basis of one of the claims Mrs Gunner makes in her cross-claim against Mr Lawrence (see [538] to [551] below).

There were further developments concerning the Beecroft contract between February 2011 and February 2012. I deal with those developments later in these reasons.

As I have mentioned, in July 2010 Mrs Gunner allowed Mr Lawrence to place advertisements for the sale of her Sydney properties on her behalf.

In July or August 2010, Mr Steven Painter from Attentus Subdivision Pty Ltd responded to the advertisement. Mrs Gunner asked Mr Painter to contact Mr Lawrence to obtain documents concerning the property but said to Mr Painter:

In February 2011 Mrs Lawrence told Mrs Gunner that Mr Lawrence had done a "deal" with Mr Painter concerning 132 Clontarf Street.

Accordingly, on 16 March 2011 Mrs Gunner instructed her conveyancer to write to the solicitors acting for Attentus in the following terms:

On 17 March 2011 the solicitors acting for Attentus replied:

This evidence reveals that, unbeknown to Mrs Gunner, and without her authority, Mr Lawrence had been negotiating with Attentus for the sale of Mrs Gunner's property at 132 Clontarf Street and, as part of that negotiation, was prepared to provide his property as security for vendor finance to be provided by Mrs Gunner.

Leaving aside the question of Mr Lawrence’s authority to act this way, Mr Lawrence’s conduct in purporting to negotiate a sale of 132 Clontarf Street to Attentus cannot be reconciled with him having a belief in the existence of the 132 Clontarf Street Agreement. If, as he now says, he was entitled to enforce such an agreement, why would he seek to negotiate the sale of 132 Clontarf Street to Attentus, rather than insist that Mrs Gunner honour his alleged entitlements under the 132 Clontarf Street Agreement?

I find this conduct a further reason for scepticism concerning Mr Lawrence’s evidence.

On 9 February 2011, Mrs Gunner sent a "Notice to Vacate" 134 Clontarf Street to Mr and Mrs Lawrence in the following terms:

Mr and Mrs Lawrence’s response was, on or about 7 April 2011, to contact the Mental Health Unit in Taree seeking to refer Mrs Gunner to that unit on the basis that she was "manic".

The Mental Health Unit Assessment report dated 7 April 2011 includes the following:

Mrs Gunner was thereafter interviewed by an officer of the Mental Health Unit, who made the following observations about Mrs Gunner:

The report concluded that Mrs Gunner was not suffering any mental illness or disorder and did not have an "at risk mental state".

The report stated:

The report also noted that the unit had contacted Mrs Gunner's General Practitioner, Dr Trevor Banks, who reported that he had seen Mrs Gunner as recently as 31 March 2011 and that he had "no current concerns [for] Mrs Gunner's mental health state".

The report concluded:

I find it impossible to comprehend what rational basis could possibly have existed for Mr and Mrs Lawrence to have taken the course revealed by this evidence. According to the Mental Health Unit's report, the stated basis for Mr and Mrs Lawrence's concern about Mrs Gunner's mental state was her decision to sell a property "$200,000 below value agreed upon". Presumably this was a reference to Mrs Gunner's decision to sell 132 Clontarf Street to Attentus for $1,850,000, in the circumstances to which I have referred.

What is clear is that, knowing full well of Mrs Gunner's decision to sell 132 Clontarf Street to Attentus, and in the face of Mrs Gunner’s demand for possession of 134 Clontarf Street, Mr Lawrence made no assertion as to the existence of the 132 Clontarf Street or 134 Clontarf Street Agreements. Rather, he and Mrs Lawrence acted as I have set out. If, as he now contends, he had reached an arrangement with Mr Gunner to the effect of the 132 Clontarf Street and 134 Clontarf Street Agreements, and if, as he says, Mrs Gunner had on 18 March 2009 agreed to continue or abide by those agreements, he surely would have agitated those matters at this point, rather than making the allegations summarised in the Mental Health Unit's report.

This is further evidence pointing against the probability of the existence of the agreements for which Mr and Mrs Lawrence now contend.

Mrs Gunner described her reaction to Mr and Mrs Lawrence's conduct in the following terms:

Nonetheless, Mrs Gunner achieved a reconciliation with her sister.

Mrs Gunner gave this evidence:

Thus, on 18 April 2011 Mrs Gunner wrote to Mr and Mrs Lawrence:

Mrs Gunner gave this evidence:

That culminated in Mrs Gunner giving Mrs Lawrence two cheques for $50,000 and $100,000 dated 23 May 2011 and 17 June 2011 respectively which Mrs Gunner sent to Mrs Lawrence under cover of a note:

Rex and Peppi were Mrs Gunner's pets.

This was by no means the first cash gift that Mr and Mrs Lawrence had received from Mr and Mrs Gunner, and from Mrs Gunner after Mr Gunner’s death. Between March 2003 and July 2011, Mr and Mrs Gunner, and then Mrs Gunner, made cash gifts to Mr and Mrs Lawrence totalling $1,169,000. In addition, Mr and Mrs Gunner gave numerous gifts to Mr and Mrs Lawrence, and also to Mr and Ms Pearson. Those gifts included international business class travel, computers, motor vehicles, clothing, jewellery and, in Ms Pearson’s case, horses. I set out the detail of those gifts and their relevance to the issues in these proceedings later in these reasons (see [380] and [487] to [492] below).

Also in April 2011, Mrs Gunner mentioned her sale of the Beecroft property to SLN Developments to Mr Chapman. As I have stated (see [140] above), Mrs Gunner had, in January 2010, appointed Mr Chapman to manage her properties.

Mrs Gunner and Mr Chapman had the following conversation:

Accordingly, in around May 2011 Mrs Gunner retained Mr Tony Marshall, of Paton Hooke Lawyers, to act for her.

Following Mr Gunner's death, Mrs Gunner had retained Elliot Tuthill Solicitors to act for her in relation to Mr Gunner's estate. However, so far as the evidence reveals, Mrs Gunner's retainer of Mr Marshall in May 2011 was the first time since Mr Gunner's death that Mrs Gunner sought and obtained legal advice about her position concerning the property portfolio that she had inherited, including the Old Bar, Beecroft, Mt Colah and Clontarf Street properties.

At around this time, on 20 May 2011, Mrs Gunner appointed Mr Chapman as her enduring guardian.

This appointment evidently caused deep distress to Mr and Mrs Lawrence, particularly Mrs Lawrence, who saw it as personal betrayal. It is no exaggeration to say that Mrs Lawrence became obsessed with her sister’s appointment of Mr Chapman. That sentiment was revealed, most starkly, in an application that Mrs Lawrence made concerning Mrs Gunner to the Guardianship Tribunal, which I deal with later in these reasons.

What motivated Mrs Gunner to appoint Mr Chapman as her enduring guardian was not revealed in the evidence and has no relevance to any issue in the proceedings. In her affidavit evidence, Mrs Gunner retained a dignified silence on the topic.

In cross-examination, the only question Mr King asked Mrs Gunner on the subject was “whose idea was it for Mr Chapman to become your enduring guardian”. Mrs Gunner responded “[m]ine”, and there it was left.

Nothing in the evidence suggests that Mrs Gunner had any complaint to make about Mr Chapman’s conduct while he was her enduring guardian, nor that there is any other reason to criticise Mr Chapman’s conduct.

Prior to Mr Gunner’s death, Mr Lawrence dealt with a surveyor, Mr Mark Searles, concerning the Old Bar property. At that time, Mr Lawrence, purporting to act as Mr Gunner's "project manager", asked Mr Searles to consider what options were available to clear the land.

Mr Searles was called to give evidence by Mrs Gunner. I found him to be an honest witness. He had no interest in the outcome of these proceedings and I have no hesitation in accepting his evidence. Despite the fundamental inconsistency between his account of what passed between him and Mr Lawrence, and Mr Lawrence’s claim in these proceedings, his evidence was barely challenged in cross-examination by Mr King.

Mr Searle said that in the second half of 2009, after Mr Gunner died, Mr Lawrence again contacted him purporting to provide instructions to proceed with the Old Bar project and “in particular to try and obtain development approval for the subdivision” of the Old Bar property.

In about September 2011, Mr Searles had a conversation with Mr Lawrence in the following terms:

Mr King cross-examined Mr Searles but did not, in substance, challenge this evidence. In cross-examination Mr Searles gave this evidence:

Earlier in the cross-examination Mr Searles had given this evidence:

This evidence reveals that what Mr Lawrence was proposing to Mr Searles in respect of the Old Bar property was similar to Mr Lawrence's proposal to Mr Mirosevich concerning the Beecroft property; namely, the purchase from Mrs Gunner of the property by a company in which Mr Lawrence held a majority shareholding but where a third party (Mr Searles in the case of Old Bar and Mr Mirosevich in the case of Beecroft) would be the director. In each case, Mr Lawrence's requirement was that his involvement in the purchase be concealed from Mrs Gunner.

I find this conduct irreconcilable with Mr Lawrence maintaining any honest belief in the binding nature of any agreement with Mr Gunner, and later Mrs Gunner, to the effect of the Old Bar Agreement.

Implicit in Mr Lawrence's proposal to Mr Searles was that Mr Lawrence understood that Mrs Gunner had title in the Old Bar property and was not obliged to participate with Mr Lawrence in a development of the property or to deliver to Mr Lawrence two lots from a subdivision resulting from such a development.

As Mr Collins said in final submissions:

Mr Searles said he did consider Mr Lawrence's proposal in September 2011, but decided not to proceed with it.

In my opinion, Mr Lawrence’s dealings with Mr Searles, as well as those with Mr Mirosevich, point strongly to the conclusion that either Mr Lawrence’s account of his conversations with Mr Gunner is not correct or, if the conversations did occur, they were not regarded by Mr Lawrence as constituting a basis upon which any legal rights could be asserted. They are also a further reason not to accept Mr and Mrs Lawrence’s account of the conversations said to have occurred with Mrs Gunner on 18 March 2009.

In the meantime, Mr Marshall, recently retained by Mrs Gunner, conducted a company search of SLN Developments and discovered Mr and Mrs Lawrence’s 51 per cent shareholding.

On 28 September 2011, he wrote to SLN Developments' licensed conveyancer concerning the Beecroft property. Mr Marshall referred to the contract of 3 February 2011 and, in effect, invited SLN Developments to show cause why Mrs Gunner should not rescind that contract. He said:

At around this time, Mrs Gunner also gave instructions to Mr Marshall concerning 134 Clontarf Street.

On 19 October 2011 Mr Marshall sent Mr and Mrs Lawrence a Notice to Vacate. His letter included the following statement:

The following day, 20 October 2011, there having been no reply to Mr Marshall’s “show cause” letter of 28 September 2011, Mrs Gunner purported to rescind the 3 February 2011 contract with SLN Developments, substantially on the grounds set out in Mr Marshall's letter of 28 September 2011.

It was this action of Mrs Gunner that raised the ire of Mr Mirosevich to which I have referred.

On 20 October 2011, Mr Mirosevich sent an email to Mr Marshall demanding that Mrs Gunner withdraw the notice of rescission but adding:

As I set out below (see [279]), Mrs Gunner, SLN Developments and Mr Mirosevich ultimately did reach a compromise to this effect.

On 28 October 2011, notwithstanding Mrs Gunner's purported rescission of the Beecroft contract, SLN Developments contracted to sell the Beecroft property to a third party, Henlong Property Group Pty Ltd, for $2,178,000 (more than three times the purchase price from Mrs Gunner under the 3 February 2011 contract).

On either 28 October 2011 or 1 November 2011 (the “Acknowledgment of Rescission” document referred to below at [290] suggests it was the latter), for reasons not explained in the evidence, SLN Developments entered into an agreement with Minsden whereby, in effect, Minsden novated its contract with Dennis Homes for the sale of Minsden’s property at Nelson Bay for $900,000 in favour of SLN Developments. Thus SLN Developments assumed the responsibility of purchaser of the Nelson Bay property. I will return to the Minsden/SLN Developments contract below.

Mr and Mrs Lawrence's response to Mrs Gunner's 19 October 2011 demand that they vacate 134 Clontarf Street, and purported rescission of the Beecroft contract on 20 October 2011, was not to assert the existence of the 134 Clontarf Street Agreement and their entitlement, by reason of that agreement, to occupy 134 Clontarf Street “for as long as they want”.

Rather, Mr and Mrs Lawrence’s response was to take the extraordinary, and in my opinion entirely unjustified, step of making an application to the Guardianship Tribunal to have Mrs Lawrence appointed as Mrs Gunner's Guardian and Financial Manager.

As a matter of formality, the application was made by Mrs Lawrence alone. However, cross-examination of Mr and Mrs Lawrence revealed that it was a joint endeavour. Mr Lawrence said the documents forwarded to the Guardianship Tribunal comprised “a composition of Valerie’s concerns”, but that “I would’ve composed them with Valerie”.

Mrs Lawrence made that application on 26 October 2011. On that day, she filled out a pro-forma which asked the question:

Mrs Lawrence answered:

In regard to that statement, Mr Lawrence gave this evidence in cross-examination:

And yet Mr Lawrence was prepared to participate in the preparation of a document, sent to the Tribunal, which said just that.

In answer to the question "approximately how long has 'the person' had the disability?" Mrs Lawrence wrote:

In answer to the question "why do you think a guardian is needed?" Mrs Lawrence wrote:

Mrs Lawrence's reference to Mrs Gunner recently becoming "involved" with a real estate agent is evidently a reference to Mr Chapman who, as I have mentioned, was appointed by Mrs Gunner in January 2010 to assist managing her property portfolio and in May 2011 as her enduring guardian.

On 11 November 2011 Mrs Lawrence wrote to the Guardianship Tribunal making a number of allegations concerning Mrs Gunner, principally to the effect that she lacked the capacity to manage her financial affairs and was not receiving "independent financial or legal advice".

Mrs Lawrence also alleged that Mrs Gunner:

No attempt was made before me by Mr or Mrs Lawrence to justify those scurrilous allegations.

An insight as to Mrs Lawrence's motivations in making the application to the Guardianship Tribunal is revealed in a letter that Mrs Lawrence sent Mrs Gunner on 31 December 2011. That letter was in the following terms:

That letter suggests that the matter that particularly aggrieved Mrs Lawrence was Mrs Gunner's appointment of Mr Chapman as her enduring guardian. Mrs Lawrence described that matter as being "the only reason why this tribunal is happening".

In cross-examination, Mr Lawrence said:

However, later in the cross-examination Mr Lawrence offered a different explanation. In an evidently unguarded moment, he said:

Although Mr Lawrence purported to “withdraw” that evidence shortly after giving it, I am satisfied that it represented his true position.

The “letters” from Mrs Gunner’s “legal advisor” were obviously those sent by Mr Marshall purporting to rescind the Beecroft contract and giving Mr and Mrs Lawrence notice to vacate 134 Clontarf Street.

Thus, on 7 January 2012 Mrs Lawrence sent Mrs Gunner a Notice to Produce at the Guardianship Tribunal hearing. Amongst the documents sought to be produced were:

In my opinion, this confirms that the application to the Guardianship Tribunal was not, in truth, borne of any misguided concern Mr and Mrs Lawrence had for Mrs Gunner’s financial welfare. It was “retaliation” for Mrs Gunner’s assertion of her rights concerning Beecroft and 134 Clontarf Street. The application made no mention of the agreements for which Mr and Mrs Lawrence now contend, and provides further reason to doubt the existence of those agreements.

Mrs Lawrence's application to the Guardianship Tribunal was fixed for hearing in Port Macquarie on 10 January 2012. Mrs Gunner did not attend the hearing in person, as she was booked to have an operation and could not travel. She attended by telephone. Mr Marshall attended, but as a witness rather than Mrs Gunner’s legal representative.

According to Mrs Lawrence, on the evening before the hearing, Mrs Gunner told Mrs Lawrence “I want you to withdraw the Guardianship Tribunal [application]”. Mrs Lawrence replied “I will if you cancel the appointment of Rob Chapman as enduring guardian”.

On the day of the hearing, the Tribunal consented to Mrs Lawrence withdrawing her application and noted that, before the Tribunal hearing had commenced, Mrs Gunner had executed a document revoking Mr Chapman’s appointment.

Nonetheless, the Tribunal delivered “Reasons for Decision” which held that there was no basis for Mrs Lawrence's application for guardianship and financial management orders in respect of Mrs Gunner. The Tribunal stated:

Immediately after the Guardianship Tribunal hearing, Mr and Mrs Lawrence drove to Mrs Gunner's Tinonee home and, to use Mrs Gunner's words, "attempted to reconcile with me".

During those discussions Mrs Lawrence spoke to Mrs Gunner about a house she had seen that "would go well being built on 134 Clontarf Street".

Despite Mrs Lawrence's conduct before and at the Guardianship Tribunal, Mrs Gunner stated that she thought Mrs Lawrence "appeared to be genuine and trying to reconcile our differences". Mrs Gunner added that Mrs Lawrence "was offering to stay with me at my Tinonee home to assist with my recovery after my operation in February”.

Accordingly, notwithstanding all that had happened, Mrs Gunner had the following conversation with her sister:

At around this time, Mrs Lawrence faxed Mrs Gunner a “handwritten agreement”. That document was not in evidence before me. However, Mrs Gunner said that it included a provision that Mrs Gunner give Mr and Mrs Lawrence a “life tenancy” at 134 Clontarf Street.

Mrs Gunner said she telephoned her sister and they had the following conversation:

In cross-examination, Mrs Lawrence said that she did not recall sending Mrs Gunner such a document, but did not deny it.

The document that Mrs Lawrence re-wrote and faxed back to Mrs Gunner on 27 January 2012 was in the following terms:

Mrs Gunner gave evidence that:

Mr King submitted that this letter “should be enforced according to its terms” and that I should order specific performance of the promises Mrs Gunner is said to have made in it.

I do not accept that submission. The document records an informal, and, as it turns out, short-lived, arrangement between family members rather than a legally binding contract that was capable of specific performance.

The document must be seen in the context of Mrs Lawrence’s earlier attempt to persuade Mrs Gunner to sign a handwritten document stating that Mr and Mrs Lawrence were to have a “life tenancy” at 134 Clontarf Street.

The effect of the 27 January 2012 document is to record Mrs Gunner’s then confirmation and agreement that Mr and Mrs Lawrence could remain living at 134 Clontarf Street “until such time as a subdivision is approved and a dwelling is erected”.

No consideration was given by Mr and Mrs Lawrence for that agreement. In any event, it is inconsistent with the 134 Clontarf Street Agreement which Mr Lawrence claims he reached with Mr Gunner in 2004 (which allegedly gave Mr and Mrs Lawrence occupation for life).

Shortly after Mrs Gunner signed the document, Mr and Mrs Lawrence submitted to her the “Declaration of Trust” document to which I refer below. As I discuss, such promise as Mrs Gunner made in the 27 January 2012 document was withdrawn by Mrs Gunner’s solicitor’s letter of 6 February 2012.

On 1 February 2012 Mrs Lawrence telephoned Mrs Gunner and said:

Rather than sending Mrs Gunner a plan or picture, Mrs Lawrence faxed to Mrs Gunner a document called "Declaration of Trust" which stated that Mrs Lawrence (defined as "the Other Party") had performed undefined "Services" for which she had “not received any cash or other financial remuneration" from Mrs Gunner (defined as "the Trustee").

The document continued:

Paragraph 3 of the document provided for Mrs Gunner to have a 60 per cent share in the property and Mrs Lawrence to have a 40 per cent share.

Mrs Lawrence said in cross-examination that Mr Lawrence had organised for solicitors in Forestville to prepare the "Declaration of Trust". Those solicitors may very well have been Walker Hedges & Co, who were acting for Minsden on the sale of the Nelson Bay property to SLN Developments at around the same time (see [282] below). Mrs Lawrence agreed that she had not performed any "[s]ervices" for Mrs Gunner for which she might be entitled to "cash or other financial remuneration". Indeed, Mrs Lawrence said that she did not "have any input whatsoever in this deed".

It is obvious, and I find, that it was Mr Lawrence who was responsible for the creation of this document and for arranging for Mrs Lawrence to send it to Mrs Gunner.

I find Mr Lawrence's desire to have Mrs Gunner sign a document such as this to be irreconcilable with him having any honest belief of having entered into the 134 Clontarf Street Agreement. Had Mr Lawrence genuinely believed in February 2012 that he and Mr Gunner had previously entered into the 134 Clontarf Street Agreement, there would be simply no reason why he would seek to persuade Mrs Gunner to execute a document to the effect of the Declaration of Trust.

Mrs Gunner gave this evidence concerning the document:

A short time later, on 6 February 2012, Mr Marshall wrote to Mr and Mrs Lawrence's then solicitors in the following terms:

In the meantime, on 19 January 2012 Mr Marshall wrote to the solicitors acting for SLN Developments to inform them that Mrs Gunner was prepared to withdraw her purported rescission of the Beecroft contract provided that the purchase price under that contract was increased from $600,000 to $1.2 million. On behalf of SLN Developments, Mr Mirosevich agreed to this proposal. The agreement was documented in a Deed of Agreement made on 3 February 2012 between Mrs Gunner, Mr Mirosevich and SLN Developments.

In those circumstances, the sale from Mrs Gunner to SLN Developments of the Beecroft property settled on or about 3 February 2012 for a purchase price of $1.2 million.

On the same day, the on-sale by SLN Developments of the Beecroft property to Henlong for $2,178,000 settled.

On settlement, SLN Developments received from Henlong, amongst other cheques, a cheque in favour of itself for $555,720.64 and a cheque in favour of “Walker Hodges [sic] Trust Account” for $300,000. Walker Hedges & Co were Mr Lawrence’s then solicitors. Evidently, they were acting for Minsden on the sale of the Nelson Bay property to SLN Developments.

As to the $300,000 cheque, in an email sent to SLN Developments’ conveyancer on 25 January 2012, Mr Mirosevch said:

Further, on 1 February 2012, two days before the settlement of both the sale of Beecroft from Mrs Gunner to SLN Developments and from SLN Developments to Henlong, Mr Mirosevich sent another email to SLN Developments’ conveyancer directing that she ask Henlong to provide a cheque on settlement of $1.2 million in favour of Mrs Gunner. The email continued:

Those instructions evidently reflected an agreement reached between SLN Developments and Minsden that, for reasons not revealed in the evidence, the deposit payable by SLN Developments to Minsden on the purchase by SLN Developments of the Nelson Bay property was to be increased to $300,000, and released forthwith to Minsden.

Thus, on 2 February 2012, Mr Mirosevich wrote to Walker Hedges & Co:

In effect, SLN Developments agreed that the deposit it should pay Minsden in respect of the Nelson Bay purchase should be increased (from a figure not revealed in the evidence) to $300,000 and that SLN Developments would pay that amount to Minsden from the proceeds of its sale of the Beecroft property to Henlong, in the form of a bank cheque in favour of Mr Lawrence’s solicitors, Walker Hedges & Co.

Settlement of the sale of Beecroft from Mrs Gunner to SLN Developments, and the on-sale from SLN Developments to Henlong, proceeded (evidently simultaneously) on 3 February 2012 on this basis. Mrs Gunner received, net, $1,166,345.20. SLN Developments received, net, $855,720.64, comprising the $300,000 bank cheque in favour of “Walker Hodges [sic] Trust Account” that Mr Lawrence was to receive on settlement, and the $555,720.64 that SLN Developments itself received.

On 13 February 2012, again for reasons not revealed in the evidence, SLN Developments and Minsden agreed to rescind the Nelson Bay contract and the $300,000 deposit to be forfeited to Minsden.

Thus, on 13 February 2012, Mr Mirosevich executed an “Acknowledgment of Rescission” on behalf of SLN Developments in the following terms:

The $300,000 deposit held by Minsden in respect of the sale by it to SLN Developments of the Nelson Bay property was, the evidence above suggests, received in the form of the “Walker Hodges [sic] Trust Account” cheque for $300,000 that Mr Lawrence collected on 3 February 2012 at the settlement of the on-sale by SLN Developments to Henlong of Beecroft.

Although no direct evidence of this was before me, there is no reason to doubt that that deposit was forfeited to Minsden in accordance with the 13 February 2012 Acknowledgement of Rescission.

The evidence before me did not reveal why SLN Developments and Minsden agreed to increase the deposit payable by SLN Developments in respect of the Nelson Bay purchase to $300,000 and then to, less than two weeks later, rescind the Nelson Bay contract.

At some time after the 3 February 2012 settlement, Mr Lawrence told Mr Mirosevich that he needed immediate payment of his “share” of the profit made by SLN Developments from the Beecroft transaction, in order to fund litigation against Mrs Gunner concerning her conduct in relation to that very transaction. Presumably, this was a reference to Mrs Gunner’s purported rescission of the Beecroft contract. What claim Mr Lawrence might properly have against Mrs Gunner, in light of his failure to disclose his and Mrs Lawrence’s interest in SLN Developments and the contents of the Deed of Agreement made between Mrs Gunner and SLN Developments on 3 February 2012, eludes me.

Thus, in his affidavit, Mr Mirosevich said:

My attention was not directed in final submissions to any direct evidence of these payments. However, Mr Collins’s final written submissions proceeded on the basis that the $300,000 was paid to Minsden. That was also the effect of Mr Mirosevich’s evidence in cross-examination.

The $300,000 paid to Mr Lawrence (albeit, evidently at his direction, to Minsden) following his discussion with Mr Mirosevich, and representing his share of the profit made by SLN Developments in its on-sale to Henlong, must have been a different payment (albeit, coincidentally in the same amount) from the $300,000 deposit paid by SLN Developments to Minsden in respect of the Nelson Bay transaction. Mr Lawrence did not suggest, and Mr King did not put to Mr Mirosevich, that the documents referred to above concerning the increase of the Nelson Bay deposit to $300,000 and its subsequent forfeiture to Minsden were confected to disguise a profit distribution by SLN Developments to Mr Lawrence. I see no reason to conclude that those transactions were not genuine commercial transactions. The reason they occurred was not explained in the evidence, no doubt because of their faint (at best) relevance to the issues in the proceedings.

I therefore find that the distribution of “profit” to Mr and Mrs Lawrence from the Beecroft sale of $315,000 was funded by the $555,720.64 received by SLN Developments on the settlement of its on-sale of Beecroft to Henlong.

I will return to the significance of these matters when I consider Mrs Gunner’s cross-claim.

Mr and Mrs Lawrence did not vacate 134 Clontarf Street by 17 February 2012, as demanded in Mr Marshall's letter of 6 February 2012.

Consequently, on 21 February 2012, Mrs Gunner commenced proceedings in the CTTT against Mr and Mrs Lawrence seeking possession of 134 Clontarf Street.

On 15 May 2012, Mr and Mrs Lawrence filed submissions in answer to Mrs Gunner's claim for possession.

In those submissions, Mr and Mrs Lawrence asserted for the first time the existence of the Mt Colah, Old Bar, Beecroft, 132 Clontarf Street and 134 Clontarf Street Agreements between Mr Lawrence and Mr Gunner, as well as the 18 March 2009 Agreement with Mrs Gunner.

Mrs Gunner described her reaction to Mr and Mrs Lawrence making these allegations in the following terms:

Mrs Gunner also said, and I accept, that:

The CTTT proceedings were listed for hearing on 13 September 2012.

On 5 September 2012 the plaintiffs commenced these proceedings.

As I have mentioned, in light of the commencement of these proceedings, on 12 September 2012 the CTTT vacated the 13 September 2012 hearing date, and ordered that the CTTT proceedings be transferred to this Court to be heard in conjunction with these proceedings. The CTTT also ordered that the CTTT proceedings be stayed pending final determination of these proceedings.

Mr Gunner’s death certificate, dated 23 March 2009, stated that his cause of death was respiratory failure, acute pulmonary oedema, fluid overload, acute chronic renal failure, dehydration and chronic lymphocytic leukaemia.

On 18 May 2014, Mr Lawrence wrote to the Manning Rural Referral Hospital stating:

In that letter, Mr Lawrence suggested that Mrs Gunner had delayed calling an ambulance to take Mr Gunner to hospital. I deal with that allegation later in these reasons (see [332] to [336] below).

Mr Lawrence also stated that “the Ambulance man said Norman was possibly septic” and asked the hospital to reconsider the death certificate.

What possible business Mr Lawrence had in making this inquiry is beyond me.

Nonetheless, the hospital acceded to Mr Lawrence’s request and, on 28 May 2014, wrote to the Registry of Births, Deaths and Marriages agreeing that “‘septicaemia’ should be added as an antecedent cause of death for Mr Gunner”.

The only relevance that I can see of these matters (apart from the insight they give to Mr Lawrence’s judgment and perspective) concerns the evidence of Ms Pearson, which I refer to below (at [386]).

For the reasons that follow, I am not satisfied that Mr Gunner made any of the agreements alleged by Mr Lawrence. In fact, despite Mr Gunner's unavailability as a contradictor, I am comfortably satisfied that he did not.

My conclusion is that Mr and Mrs Lawrence have not established the existence of any of the agreements for which they contend. There were therefore no "agreements with Norm" that, after his death, could be "continued" by Mrs Gunner.

In any event, I do not accept that on 18 March 2009, Mrs Gunner said anything to the effect of the words alleged by Mr and Mrs Lawrence.

My first reason for rejecting Mr and Mrs Lawrence’s claims concerning the Old Bar, Beecroft, Mt Colah, 132 Clontarf Street and 134 Clontarf Street Agreements is the inconsistency between Mr Lawrence’s evidence as to the existence of such agreements and his and Mrs Lawrence’s conduct. These inconsistencies have been described in detail above, in the course of outlining the relevant events. They are:

For the reasons I have explained when discussing the course of events, I find the matters referred to in the preceding paragraph inconsistent, and indeed irreconcilable, with Mr and Mrs Lawrence having any genuine belief in the existence of the Old Bar, Beecroft, 132 Clontarf Street and 134 Clontarf Street Agreements. Although none of these matters concern the Mt Colah property itself, I find them also to be inconsistent with Mr and Mrs Lawrence having any genuine belief in the existence of an agreement concerning that property. If there was no Old Bar, Beecroft, 132 Clontarf Street and 134 Clontarf Street Agreements, it defies credulity to suggest that there was, only, a Mt Colah Agreement.

If, as Mr Lawrence claims, he did enter the various agreements with Mr Gunner for which he contends, and if he understood them to have the legal force that he claims, he would surely have asserted their existence at the time of each of these events.

Instead he behaved in an opportunistic way with various people, and in relation to various of the subject properties, to try to make as much as he could from the properties. His conduct was not only inconsistent with the existence of any of the alleged agreements, but for the most part also assumed Mrs Gunner’s entitlement to those properties. Mrs Lawrence cannot be in any better position.

I find these matters alone sufficient to reject Mr and Mrs Lawrence’s claims.

But there is more.

I find Mr and Mrs Lawrence’s case inherently improbable, for the reasons I have set out above.

In particular, I repeat that Mr Lawrence made no note or memorandum of the alleged agreements; he made no mention of them in his very detailed diaries; and he did not assert their existence until May 2012 (over three years after Mr Gunner died) in the CTTT proceedings and only then in response to Mrs Gunner’s claim for possession.

Further, I simply do not believe the evidence that Mr and Mrs Lawrence have given before me, for reasons I will now set out.

There are a number of aspects of the evidence given by Mr Lawrence which lead me to conclude that Mr Lawrence is not a reliable informant and is a witness whose evidence cannot be accepted unless corroborated by contemporaneous documents, or other independent witnesses (which it is not). He was, in my opinion, prepared to say whatever he thought might assist his case, no matter how absurd or improbable that might be. Indeed, my overall impression of Mr Lawrence was that he is a person who does not now know what truly happened so far as concerns the events that are the subject of these proceedings. He has recreated in his mind a version of those events that suits his case, and that he may well now genuinely believe to be true; but which cannot be accepted as reliable. I do not accept his evidence.

Mr Lawrence made a large number of extraordinary allegations about Mrs Gunner.

For example, Mr Lawrence alleged that Mrs Gunner had, as long ago as the 1980s, manipulated Mr Lawrence’s business partners. Thus he stated, in one of his affidavits:

When asked about this statement in cross-examination, Mr Lawrence said:

As I have mentioned, Mr Lawrence also alleged that Mrs Gunner deliberately contributed to her husband’s death. Thus, in an affidavit Mr Lawrence said:

In cross-examination Mr Collins took Mr Lawrence to his statement, set out above, that Mr Gunner did not die because of his leukaemia condition. The following evidence ensued:

In cross-examination, Mr Lawrence was asked upon what basis he made that allegation. He said:

Mr Lawrence gave the following further evidence in response to questions from me:

Mr Lawrence’s preparedness, in the circumstances, to conclude that Mrs Gunner had deliberately delayed calling the ambulance with a view to inheriting Mr Gunner’s estate bespeaks an irrationality of mind on the part of Mr Lawrence that causes me deep disquiet concerning his evidence generally.

Mr Lawrence was also deeply involved in the preparation of the documents that Mrs Lawrence sent the Guardianship Tribunal, referred to above.

At one point in the cross-examination, Mr Lawrence said that the material submitted to the Guardianship Tribunal was a “composition of Valerie’s concerns” and that “it’s my wife who did the application, it’s not me”.

However, Mr Lawrence later agreed that he and Mrs Lawrence had prepared the document together (“it would have been Valerie and I”).

As I have set out above, although Mr Lawrence participated in the creation of the document which asserted that Mrs Gunner had an 80 per cent mental “disability”, he agreed in cross-examination that that was not his belief (at [235]).

As I have also mentioned, no attempt was made in these proceedings to justify the statements made to the Guardianship Tribunal that Mrs Gunner had been in prison and a prostitute (see [241] above).

The manner in which Mr Lawrence (and Mrs Lawrence) pursued the Guardianship Tribunal application reveals a complete loss of perspective on their part. Notwithstanding Mrs Gunner’s extraordinary generosity to them over the years, and because of what appears to me to be an irrational apprehension by them, arising from Mrs Gunner’s appointment of Mr Chapman as her enduring guardian, that Mrs Gunner’s financial position was at risk (a matter which was none of their business), they brought an application which had no warrant and was resolved in the manner I have set out above.

The mere fact that Mr and Mrs Lawrence made, and pursued, that application reflects badly on their credit.

I have set out the circumstances in which Mr Lawrence acquired a shareholding in SLN Developments, failed to reveal that shareholding to Mrs Gunner, and then arranged, in company with Mr Mirosevich, to on-sell the Beecroft property to Henlong at a profit.

Mr Collins put the matter, somewhat colourfully, as follows:

I accept this submission. Not only was Mr Lawrence’s conduct inconsistent with him having any genuine belief of any agreement with Mr Gunner of the kind for which he now contends, it shows that he was prepared to seek to make a profit for himself (through his shareholding in SLN Developments) from the sale of the property that he now claims he was helping Mrs Gunner to develop. Again, this reflects poorly on his credit as a witness.

A revealing insight into Mr Lawrence’s credibility was given by his evidence in relation to the question of whether Mrs Gunner had ever lent him money.

Early in the cross-examination, Mr Lawrence gave the following evidence:

Mr Collins then took Mr Lawrence to an affidavit he swore in proceedings brought against him in this Court by the liquidator of Lawrence Waterhouse Pty Ltd (in liquidation).

Mr Lawrence had annexed to that affidavit a schedule which set out his “explanation” for various payments made to that company.

One of those payments involved a cheque for $14,331 in favour of the company from Mrs Gunner. In the schedule, Mr Lawrence stated that the relevant cheque butt notation was “Flight Centre Payment for UK trip tickets” and that the “[e]xplanation” for the payment was “Gunner Loan A/C/Lawrence”.

Mr Lawrence gave this evidence:

A short time later Mr Lawrence gave this evidence, initially in response to questions from me and then in response to Mr Collins:

And so it went on.

Later in the cross-examination, Mr Lawrence was taken to an affidavit he had sworn in the Lawrence Waterhouse proceedings in which he stated that he had paid into Lawrence Waterhouse money “that had been provided to me by my sister in law, Frances Gunner. She provided the monies to me as a loan and I placed them into Lawrence Waterhouse”. Mr Lawrence then set out seven payments totalling $130,627, each of which was described as “loan to W Lawrence”.

In cross-examination, Mr Collins again put to Mr Lawrence that these statements were inconsistent with the evidence he had given before me to the effect that Mrs Gunner had never loaned him money.

Mr Lawrence gave this evidence:

A short time later, Mr Lawrence gave this evidence:

Mr Lawrence was prepared in these proceedings to characterise payments made to him (or companies with which he was associated) by Mrs Gunner as gifts. But in the Lawrence Waterhouse proceedings, he characterised the same payments as loans due to his apprehension, which he volunteered in the passage I have set out at [353], that if he told the liquidator that the payments were gifts, the liquidator would claim an entitlement to the funds.

When confronted with the tension between these two positions, Mr Lawrence was either unable to appreciate the true position (namely, that he was giving inconsistent evidence) or gave disingenuous evidence before me.

Either way, it reveals Mr Lawrence to be a most unreliable witness.

In their amended statement of claim, Mr and Mrs Lawrence alleged that in June 2004, in reliance on the Old Bar Agreement, the Beecroft Agreement, the Mt Colah Agreement and the 132 Clontarf Street Agreement, Mr Lawrence “took steps to reduce his involvement in a property development in Braemar, and by doing so gave up the opportunity to make additional profits”.

Ultimately, that claim was abandoned by Mr King, after Mr Collins made clear in his cross-examination of Mr Lawrence that the allegation could not be made out. This was for the simple reason that the “steps” that Mr Lawrence took to “reduce his involvement” in the Braemar property development took place in June 2004, whereas he alleged that his agreements with Mr Gunner were made towards the end of 2004 or the beginning of 2005.

The particular steps that Mr Lawrence claimed he took were summarised in an affidavit he swore shortly before the commencement of the proceedings as follows:

However, in an affidavit that Mr Lawrence swore in separate proceedings involving his former joint venturers in the Braemar development in the District Court of NSW, Mr Lawrence gave a different account of why he did not proceed with the Braemar development.

In that affidavit, he alleged that the reason he did not proceed with the Braemar development was that his former partners, in breach of their obligations under a deed entered into to settle an anterior dispute concerning Braemar, had failed to deliver to Mr Lawrence plans and other documents allegedly necessary for the “commencement of construction of the remaining development” at Braemar.

This is another example of Mr Lawrence swearing to the truth of whatever he thinks is necessary to suit the purpose at hand.

Although Mrs Lawrence purported to give evidence corroborative of that of Mr Lawrence, I do not accept her as an independent witness. Mrs Lawrence is, of course, one of the plaintiffs and not independent in that sense. Moreover, the circumstances in which Mrs Lawrence prepared both Mr Lawrence’s and her own affidavits show that, to adopt Mr Collins’s language, she "offers no independent way to the truth".

As I have mentioned, until shortly before the commencement of these proceedings Mr and Mrs Lawrence were self-represented.

Mr Lawrence’s first affidavit, which contained some 270 paragraphs and was almost 56 pages in length, was sworn on 30 May 2013. Thereafter he swore affidavits on 27 June 2013, 17 February 2014, 6 March 2014, 11 April 2014, 6 June 2014, 10 June 2014, 4 August 2014 (two affidavits), 2 September 2014, 25 September 2014, 26 September 2014 (five affidavits), and 20 November 2014.

Mrs Lawrence’s first affidavit was sworn on 25 May 2013. She subsequently served affidavits sworn on 11 April 2014 (two affidavits), 6 June 2014 (containing some 552 paragraphs and extending over 100 pages) and 4 August 2014.

The evidence revealed that there was close cooperation between Mr and Mrs Lawrence in the preparation of their affidavits.

Mr Lawrence dictated his affidavits to Mrs Lawrence, who typed the affidavits as he dictated.

Mr Collins put the matter this way in his closing submissions:

I accept the submissions contained within this passage. I do not regard Mr or Mrs Lawrence as being reliably corroborative of the other. In substance, Mr Lawrence’s version of events has become the evidence of both.

Mrs Lawrence was, of course, on Mr Lawrence’s account of it, invariably either in the kitchen or out walking with Mrs Gunner on each of the occasions when Mr Gunner allegedly made the agreements with Mr Lawrence for which he now contends. She was thus unable to corroborate Mr Lawrence’s evidence on the critical question of the making of the agreements.

I have set out above details of Mrs Lawrence’s involvement in the Guardianship Tribunal application, her participation in the delivery to Mrs Gunner of the 27 January 2012 document and her delivery to Mrs Gunner of the Declaration of Trust.

In my opinion, these matters reflect very badly on Mrs Lawrence. They show that, in concert with her husband, she was prepared to make statements she must have known to be false, and prepare documents that she must have known did not reflect any true state of affairs between her, her husband and her sister.

As I have said, Ms Pearson is the daughter of Mrs Lawrence and stepdaughter of Mr Lawrence; and thus Mrs Gunner’s niece.

Over the years, Mrs Gunner had shown much kindness and generosity to Ms Pearson and her husband. Amongst other things, Mrs Gunner purchased for Ms Pearson a $167,000 horse float, a $30,000 car, a $4,000 station wagon and four horses, as well as jewellery, cash and other items. She also gave Ms Pearson a Mercedes Benz four-wheel drive vehicle which originally cost Mrs Gunner something in the order of $99,000. She gave Mr Pearson a $36,000 Harley Davidson motorbike, an $8,000 trail bike and a $27,000 tractor.

Ms Pearson did not give evidence of any matter directly relevant to the existence of the agreements for which Mr and Mrs Lawrence contend, nor to Mr Lawrence’s alternative claim in quantum meruit (which I deal with below).

Ms Pearson did, however, give evidence which was extremely critical of her aunt, including evidence purportedly corroborative of that of Mr and Mrs Lawrence’s concerning Mrs Gunner’s alleged delay in calling an ambulance to transport Mr Gunner to hospital immediately prior to his death.

Mr Collins’s cross-examination revealed that Ms Pearson had no direct knowledge of the matter. Yet, she was adamant that Mrs Gunner had deliberately delayed calling the ambulance.

In one of her affidavits she said on this topic:

The “amended” death certificate to which Ms Pearson referred could only have been Mr Gunner’s death certificate, as amended by the doctors at Manning Rural Referral Hospital in May 2014 following Mr Lawrence’s misguided representations on that topic (see [309] to [315] above).

Yet in cross-examination, Ms Pearson was clear that “I don’t know anything about an amended death certificate”.

So far as concerns the preparation of her affidavits, Ms Pearson said that she “wrote everything down on a piece of paper” and that Mrs Lawrence “typed it into the computer”. She said “one of them was done over the phone”.

It seems obvious to me that Mr or Mrs Lawrence embellished whatever draft Ms Pearson provided them by adding a reference to an “amended” death certificate, but that Ms Pearson was nonetheless prepared to attest to the truth of the matter.

Mr Collins submitted that Ms Pearson was a “seriously troubled and unbalanced young woman”. Mr Collins pointed to Ms Pearson’s assertions that Mrs Gunner had offered her $650,000 to “lie” for her in these proceedings, that Mrs Gunner has “cycles of hate”, that Mrs Gunner told her she was “going to get a divorce” and wanted Mr Gunner “dead”, that Mrs Gunner had “arranged for the killing of my two horses because they were eating the cattle’s feed”, and that Mrs Gunner told her she was going to “get a hit man to have [Mr Lawrence] killed”.

Mrs Gunner denied each of these wildly improbable allegations and I accept her denial.

I think it clear that, like Mrs Lawrence, Ms Pearson’s evidence “offers no independent way to the truth” (again to adopt Mr Collins’s words).

She also gave evidence concerning Mrs Gunner’s then solicitor, Mr Marshall, with which I will deal, separately, below.

As I have stated, my conclusion is that where there is a conflict between the evidence of Mr or Mrs Lawrence and that of Mrs Gunner, I should accept Mrs Gunner's evidence.

Mrs Gunner gave her evidence in a quiet and courteous manner. She gave careful attention to the questions asked of her in cross-examination and to the detail of her answers.

Despite the manner in which she had been treated by both Mr and Mrs Lawrence in the years since Mr Gunner's death, and despite the very serious (and in my opinion, quite unjustified) allegations made by Mr and Mrs Lawrence, as well as Ms Pearson, concerning the manner in which Mrs Gunner cared for her late husband in his dying days, Mrs Gunner gave her evidence clearly, confidently and with grace, restraint and dignity.

As I have set out, the kindness Mrs Gunner bestowed on Mr and Mrs Lawrence, despite the manner in which they treated her, is a testament to her character.

I have no hesitation in accepting her as a witness of truth.

This concludes my consideration of whether Mr Lawrence reached the agreements with Mr Gunner that he alleges. For the reasons I have set out, I do not accept Mr and Mrs Lawrence’s case. I now turn to other aspects of the matter.

There is a further difficulty with Mr and Mrs Lawrence’s case.

Even if I were satisfied that that Mr Gunner did make the agreements for which Mr and Mrs Lawrence contend, any such arrangements would have amounted to partnerships between Mr Gunner and Mr Lawrence for the purposes of s 1(1) of the Partnership Act 1892 (NSW). Section 1(1) provides:

In the original iteration of their statement of claim, Mr and Mrs Lawrence described each of the Old Bar, Beecroft, Mt Colah, 132 Clontarf Street and 134 Clontarf Street Agreements as “a partnership”. However, by their amended statement of claim filed in Court during the hearing, the agreements were described as “a partnership or joint venture or contractual agreement”.

That change in nomenclature cannot, in my opinion, alter the fact that the arrangements that Mr Lawrence claims he entered into with Mr Gunner satisfy the definition of “partnership” in s 1(1) of the Partnership Act. However else they might be described, they were (if they existed) partnerships.

That being so, any alleged agreement was governed by s 33(1) of the Partnership Act, which provides:

Mr King contended that there was such an agreement between the putative partners so as to enliven the opening words of s 33(1) (“subject to any agreement between the partners”).

However, that cannot be. The members of a two person partnership cannot agree that, on the death of one, the partnership survives. That is because, once one member of a two person partnership dies, there can no longer be any relationship which exists between “persons” carrying on a business in common with a view of profit.

Of course, multi-person partnerships can, and often do, agree that if anyone of them dies, the partnership remains in existence between the survivors. But that is not this case.

Thus, if, contrary to my findings, there was a partnership between Mr Gunner and Mr Lawrence, it was dissolved on Mr Gunner’s death. Mr Lawrence’s rights, as a surviving partner, would be confined to a distribution of partnership property under ss 39 and 44 of the Partnership Act. Mr Lawrence makes no such claim in these proceedings.

As I have set out above (at [37]), Mr and Mrs Lawrence allege that, upon Mr Gunner’s death “or upon the grant of probate [sic]” to Mrs Gunner, she, “as executor [sic] of [Mr Gunner’s] estate”, was “bound by and had a duty to perform” each of the Old Bar, Beecroft, Mt Colah, 132 Clontarf Street and 134 Clontarf Street Agreements. Mr and Mrs Lawrence contend that each of those agreements is “enforceable” against her “including for breach of contract or specific performance”.

Leaving aside the alleged oral agreement reached between Mr and Mrs Lawrence and Mrs Gunner on 18 March 2009 (which I deal with below), that contention appears to be based on s 45 of the Probate and Administration Act. As I have set out above at [39], that section provides that real estate held by a person in trust or by way of mortgage vests, from the date of death of the person, in the person’s executor or administrator subject to the same trusts and equities.

In my opinion, that section has no work to do in this case. Even on Mr Lawrence’s account of it, the properties in question were not, in Mr Gunner’s lifetime, subject to any trusts, mortgages or equities such as would, by reason of s 45 of the Probate and Administration Act, bind Mrs Gunner as (ultimately) the administrator of Mr Gunner’s property.

As I have set out above, Mr and Mrs Lawrence claim that on 18 March 2009, the day after Mr Gunner died, Mrs Gunner said to them something to the effect that “everything will continue on the same as your agreements with Norm” (see [122] above).

As I have concluded that there were no “agreements with Norm”, this aspect of Mr and Mrs Lawrence’s claim cannot take their case any further. There were no arrangements for Mrs Gunner to “continue”.

In any event, I have set out above my reasons for not accepting Mr and Mrs Lawrence’s evidence about this matter.

First, Mrs Gunner denied saying any such thing, and I prefer her evidence to that of Mr and Mrs Lawrence. Further, Mrs Gunner denied that Mr Lawrence was even present on 18 March 2009. I accept that evidence over the denials of Mr and Mrs Lawrence.

Second, even if I were to accept that Mr Lawrence was present, it was (at least originally) his case that Mrs Gunner was ignorant of his alleged agreements with Mr Gunner. He said that Mrs Gunner and Mrs Lawrence were either out walking or working in the kitchen every time the subject arose, and that Mr Gunner did not discuss his business with Mrs Gunner. No doubt, Mr Lawrence adopted that position to avoid any difficulty that might arise from Mrs Gunner giving evidence that, during Mr Gunner’s life, she had not heard of any such arrangements. However that may be, it is obvious that Mrs Gunner could not, a day after her husband died, have said to Mr and Mrs Lawrence that “everything will continue” in accordance with arrangements of which she was ignorant.

Third, as I have mentioned, Mr and Mrs Lawrence did not assert the existence of any such statement by Mrs Gunner until they filed their defence in the CTTT proceedings in May 2012. All of the matters I have set out above concerning the irreconcilability of Mr Lawrence’s claims concerning the alleged 2004 agreements and his subsequent conduct apply with equal force to Mr and Mrs Lawrence’s claims concerning the alleged 18 March 2009 agreement.

Fourth, if Mrs Gunner did say anything on 18 March 2009, it was said in the context of Mr Gunner’s death the day before, Mrs Gunner’s grief at the death of her partner of 19 years and husband of almost ten years, and (presumably) Mrs Gunner’s desire that her identical twin sister and (if he was present) brother in law comfort her. In those circumstances, I am not prepared to find that whatever was said (if anything at all) was intended by anyone present to form the basis of any legally binding relationship.

For those reasons, I do not accept Mr and Mrs Lawrence’s case concerning the alleged 18 March 2009 agreement.

As an alternative to their claim in contract arising from the Old Bar, Mt Colah, Beecroft, 132 Clontarf Street and 134 Clontarf Street Agreements, Mr and Mrs Lawrence contend for a “constructive trust” said to arise from representations made by Mr Gunner to the same effect as the alleged Old Bar, Mt Colah, Beecroft, 132 Clontarf Street and 134 Clontarf Street Agreements; namely, that Mr Gunner would proceed in accordance with those agreements.

As I am not prepared to accept Mr Lawrence’s evidence as to what Mr Gunner allegedly said, the foundation for that claim has not been established.

In any event, the foundation of the claim is representations allegedly made by Mr Gunner as to future matters (that is, what he would do if Mr Lawrence “took over and [carried] on the development” of the various properties).

It is no part of Mr and Mrs Lawrence’s pleaded case that such representations amounted to misleading or deceptive conduct for the purposes of s 52 of the Trade Practices Act 1974 (Cth), or any cognate legislation.

If Mr Gunner did make any such future representations, the reason that the matters the subject of those representations did not come about is because he died.

In those circumstances, I cannot see how it would be “unconscionable” for Mrs Gunner to “go back on or withdraw” any such representations (as alleged in the amended statement of claim). Nor can I see why a constructive trust would be imposed.

In light of my conclusions as to the facts, Mr and Mrs Lawrence’s claim that Mr Gunner owed, and was in breach of fiduciary duty must also fail.

In view of these conclusions, it is not necessary for me to deal with the other bases upon which Mrs Gunner sought to resist the claims made against her. Those bases included that the agreements contended for by Mr and Mrs Lawrence were void for uncertainty and were, in any event, not the subject of any note or memorandum for the purposes of s 54A of the Conveyancing Act 1919 (NSW).

I have mentioned that, in around May 2011, Mrs Gunner retained Mr Tony Marshall as her solicitor.

During her cross-examination, Mrs Lawrence said that her daughter, Ms Pearson, had said that Mr Marshall had been following Ms Pearson while driving Mrs Gunner’s car.

Mr Collins took the matter up with Ms Pearson in cross-examination (she had not mentioned it in her affidavits).

Ms Pearson said that she had seen Mr Marshall drive “slowly past my house”. She said:

Ms Pearson said that on another occasion:

Ms Pearson claimed to recognise the Range Rover that Mr Marshall was allegedly driving as belonging to Mrs Gunner.

Later Ms Pearson said that Mr Marshall had also driven “twice past the house” in a white Mercedes Benz.

Mr Marshall served an affidavit dealing with this aspect of the matter but, ultimately, the affidavit was not read.

Mr Collins put the matter this way in closing submissions:

I have no reason to doubt that Mr Marshall has taken the course Mr Collins described.

The fact remains, however, that in these proceedings, Ms Pearson’s evidence about Mr Marshall’s conduct is uncontradicted.

Mr King submitted that the relevance of this material was that Mrs Gunner had made an “implied admission” of the plaintiffs’ case.

In that regard, Mr King referred to the observations of the High Court in Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11; 243 CLR 361, where Heydon, Crennan and Bell JJ said at [64]:

As I understood it, Mr King’s proposition was that, in the circumstances I have described, Mrs Gunner attempted to suborn Ms Pearson by instructing Mr Marshall to “stalk her”, and also by attempting to bribe her to give false evidence against Mr Lawrence.

Thus, in closing written submissions Mr King said:

In earlier submissions, Mr King said that Mrs Gunner went:

However, Mr King did not put to Mrs Gunner in cross-examination that she had given instructions to Mr Marshall to behave in this manner.

I took this matter up with Mr King in final submissions. Mr King said:

Mr King’s position thus appeared to be that he did not put to Mrs Gunner that she instructed Mr Marshall to “stalk” (Mr King’s language) Ms Pearson because he apprehended that any such question would have been objected to on the basis of legal client privilege. However, that apprehension was not, in my opinion, any reason not to put the proposition to Mrs Gunner, especially in circumstances where the proposition was included in final submissions. It may be that no objection would have been taken to the question in order to allow Mrs Gunner the chance to deny the proposition (if she was in a position to do so).

Unlike Mr Lawrence, who must have known from the manner of Mr Collins’s cross-examination that his case was under challenge (see [48] to [56] above), Mrs Gunner had no reason to believe during Mr King’s cross-examination that Mr and Mrs Lawrence’s case was that she had acted in the manner the subject of Mr King’s submission.

In those circumstances, I am not prepared to make a finding adverse to Mrs Gunner’s interest.

Alternative to his claim arising from the alleged agreements, Mr Lawrence brings a “quantum meruit” claim.

The claim is set out at par 106 of the amended statement of claim in the following terms:

It is common ground that Mr Lawrence’s claim is restitutionary (rather than contractual) in nature, and is confined to the work Mr Lawrence claims to have done in relation to the five properties in question. A wider claim (in respect of “Other Gunner Properties”) was made in final submissions. It was, however, outside the pleadings, and ultimately not pressed by Mr King.

The relevant principle is summarised in K Mason, J W Carter and G J Tolhurst, Restitution Law in Australia, (2nd ed 2008, LexisNexis Butterworths) at [914] as follows:

The amount originally claimed by Mr Lawrence, $781,551, as particularised at par 106 of the amended statement of claim, was summarised by the plaintiff as follows:

Thus Mr Lawrence particularised his claim by reference to work done prior to March 2009 (when Mr Gunner died) and thereafter.

In another document, included as an annexure to Mr King’s closing submissions of 21 January 2015, and headed “Schedule as to Quantum” Mr Lawrence claimed:

Another document annexed to Mr King’s submissions was 14 pages long and entitled “Various Items of Work Done by Wayne Lawrence for Gunners [Referred to in Affidavits/Exhibits]”. That document purported to be a summary of the references in the plaintiffs’ evidence to work done by Mr Lawrence (although many of the items set out did not in fact refer to evidence in the proceedings).

A further document annexed to Mr King’s submissions comprised some 110 pages and was entitled “Work Done by Wayne Lawrence”. According to that document, between 2005 and 2010 Mr Lawrence performed 9,257 hours of work referrable to one or other of the five properties in question in these proceedings, as well as work in relation to other properties owned by Mrs Gunner.

The “Work Done by Wayne Lawrence” document was said to be based on Mr Lawrence’s diaries.

Mr Lawrence claimed to have undertaken the following process to calculate the amount of work that he had done for Mr and Mrs Gunner’s benefit:

In cross-examination, Mr Lawrence agreed that this process of reasoning on his part had the result that there was no evidence before the Court that would enable independent verification of his quantum meruit claim.

Even a cursory comparison of Mr Lawrence’s diaries with his “Work Done by Wayne Lawrence” document shows the latter to be an unreliable, wildly exaggerated guide to what work Mr Lawrence, in fact, did.

In his reply submissions, in the course of advocating Mr Lawrence’s position in relation to his diary and the “Work Done by Wayne Lawrence” document, Mr King drew attention to Mr Lawrence’s diary entry of 23 June 2006, as an example “taken at random”.

At the top of that diary entry, Mr Lawrence has written “Balgowlah today Norm”. That heading was made by Mr Lawrence many years after 23 June 2006, when he was engaging in the process that I have described at [458] above.

One part of the 23 June 2006 diary entry reads:

That note appears to be a reference to work done at 134 Clontarf Street.

There is no other entry in the diary for that date which, on its face, refers to work done at 134 Clontarf Street. Mr King submitted that three entries reading “$1404.50”, “cost of concrete – 4,000 – $169” and “black $149” related to “site works at Clontarf done that day”. However, this is not apparent from the face of the diary note.

Mr King concluded:

However, inconsistently with that submission, the relevant reference in the “Work Done by Wayne Lawrence” document for 23 June 2006 asserts that on that day, Mr Lawrence worked eight hours (“one day is based on 8 hour[s] on average”) at North Balgowlah (that is, at either 132 or 134 Clontarf Street) “cleaning, taking rubbish to tip”.

That description is also given in that document for work done on each of 20, 21, 22, 24, 25, 26, 27, 28, 29 and 30 June 2006. Each page of Mr Lawrence’s diary for those days includes Mr Lawrence’s ex post facto heading “Balgowlah today Norm” or simply “Norm”, and records many activities other than work at “Balgowlah”. Some diary entries (those for 22, 25 and 30 June 2006) contain no reference at all to work done at Balgowlah (apart from the heading “Balgowlah today Norm”).

Mr Hourigan, who conducted this part of the argument on behalf of Mrs Gunner, told me that there were over 1,200 days referred to in the “Work Done by Wayne Lawrence” document, and that in some 340 cases there was no corresponding contemporaneous note in Mr Lawrence’s diary of work done. Mr Hourigan told me that there were some 370 other days where there was either no corresponding entry in Mr Lawrence’s diary to a “Gunner matter” at all or entries directly inconsistent with Mr Lawrence having done work for Mr or Mrs Gunner on the day in question.

I have not conducted an analysis of the “Work Done by Wayne Lawrence” document and Mr Lawrence’s diaries sufficient to enable me to verify the precise figures Mr Hourigan mentioned. However, my own, more limited comparison of the documents is consistent with Mr Hourigan’s submission, as is my analysis of the “random entry” of 23 June 2006 to which Mr King referred. In those circumstances, I am not satisfied that the “Work Done by Wayne Lawrence” document is of any probative value.

Perhaps recognising the difficulty he faced with this kind of material, on 2 December 2014 (the seventh day of the hearing) Mr King filed in Court a notice of motion seeking, amongst other things, an order that:

During final oral submissions, which took place on 5, 6 and 7 May 2015, Mr King moved on that motion.

In order to consider whether there was any merit in taking that course, on 7 May 2015 I directed that the plaintiffs serve a document in the nature of a Scott Schedule setting out, in chronological order, and separately in relation to each of the Old Bar, Mt Colah, Beecroft, 132 Clontarf Street and 134 Clontarf Street properties, all of the items of work claimed by way of quantum meruit and proven in the evidence, including the items set out in the “Various Items of Work Done by Wayne Lawrence for Gunners” document together with:

The Scott Schedule document produced on behalf of Mr and Mrs Lawrence in response to those directions did not, to any significant extent, take the matter further.

On occasion, that document did not set out the precise date of the work alleged to have been done but, rather, referred to work done in a date range (for example “2005 – 2011” or “2004 – 2009”).

For the most part, the document did not set out the amount claimed for each item of work, but merely stated the time said to have been spent on the work; principally by reference to Mr Lawrence’s diary.

Indeed, in relation to 134 Clontarf Street, and notwithstanding the issues to which I have referred with Mr King’s “taken at random” diary entry of 23 June 2006, the Scott Schedule document repeated, for the whole period of 19 to 30 June 2006, the claims for full days’ work purportedly based on Mr Lawrence’s diary entries.

The Scott Schedule contains almost no reference to any evidence in the proceedings that would justify the allocation of any particular hourly or daily monetary rate to the work alleged to have been done.

Further, there are claims for work done which, plainly, are not justified by the evidence to which reference is made.

For example, a claim is made for three days’ work between 13 and 15 May 2009 described as “filed the review for cost assessment re Neil Handley”. As I have mentioned at [19] above, Mr Handley was a neighbour of Mr Gunner at Beecroft who commenced proceedings against Mr Gunner in this Court. The evidence relied on to justify that claim in the Scott Schedule is Mr Lawrence’s diary. The diary does contain what appears to be a contemporaneous entry from 14 May 2009 referring to the “filing” (evidently in Court) of a “review for costs assessment”. But that day’s diary entry contains numerous other references and does not suggest that the “filing” took anything like the whole of the day. The diary entries for 13 and 15 May 2009 contain numerous entries, but make no reference to any such “filing”. The assertion that three days’ work was done is simply unsustainable.

In the response to the Scott Schedule, Mrs Gunner’s legal representatives have identified numerous other occasions where there is no diary entry that matches the description of the work now claimed to have been done, and where the hours claimed for work done is an obvious exaggeration and unable to be calculated from or derived from the diary entry relied upon.

In those circumstances, and in light of this highly unsatisfactory and unreliable material, I am not in a position to make any assessment of Mr Lawrence’s quantum meruit claim.

I am not prepared to accede to Mr King’s submission that Mr Lawrence’s quantum meruit claim should now be referred out for assessment.

Mr Lawrence has had every chance in these proceedings to make out this aspect of his case. The matter has occupied some 16 days of court time. Mr and Mrs Lawrence have filed voluminous evidence. By making the directions referred to at [473] above, I endeavoured to give Mr Lawrence a final chance to show, at least, that there was sufficiently probative material available to him to justify further consideration of his claim. He has failed to do that, and I am not prepared to allow the matter to proceed further. The notice of motion of 2 December 2014 should in due course be dismissed.

In any event, I see a further fundamental hurdle in the way of this claim. Mr Lawrence must show that, in all the circumstances, it would be unjust for Mrs Gunner to receive and retain the benefit of such work as Mr Lawrence has done for her, or in her interest, without reward.

In that regard, Mr and Mrs Lawrence have lived rent free at 134 Clontarf Street since September 2006; almost nine years.

Not only that, but they have received the benefit of Mrs Gunner’s extraordinary generosity over the years. I have mentioned some of that generosity above (for example, Mrs Gunner’s gift of $150,000 in May and June 2011, shortly after the dismissal by the Mental Health Unit of Mr and Mrs Lawrence’s application that she be “scheduled”).

Between March 2003 and July 2011, Mr and Mrs Gunner, and then Mrs Gunner, made cash gifts to Mr and Mrs Lawrence totalling $1,169,000.

The cash gifts were as follows:

In addition, Mrs Gunner paid for holidays for Mr and Mrs Lawrence (including business class airfares, five star hotel accommodation and all expenses) to New Zealand, Hong Kong (twice), Thailand, Malaysia, United States of America, United Kingdom, Fiji, Hawaii, Canada, Lindeman Island, Hamilton Island, Switzerland, France and numerous places within Australia.

Mrs Gunner also purchased a telephone, laptop and photocopier for Mr Lawrence, paid for the installation of air-conditioning and a cement driveway at Mr and Mrs Lawrence’s home in Davidson, and purchased motor vehicles for both Mr and Mrs Lawrence. There were numerous other like gifts.

In those circumstances, accepting (as Mrs Gunner does) that Mr Lawrence has done some work on the five properties for her benefit, that benefit is far outweighed by the benefits conferred by Mrs Gunner on Mr and Mrs Lawrence (and also on Ms Pearson). It therefore cannot be said that Mr Lawrence engaged in such work without reward.

For those reasons alone, I would have rejected Mr Lawrence’s quantum meruit claim, even if he had properly proven it.

Mr and Mrs Lawrence have lived at 134 Clontarf Street, rent free, since September 2006; almost nine years.

Mrs Gunner’s evidence as to the circumstances in which Mr and Mrs Lawrence came to occupy 134 Clontarf Street is set out at [105] to [117] above. I accept Mrs Gunner’s evidence. It cannot be reconciled with that of Mr and Mrs Lawrence, which I reject.

I have also rejected the submission made by Mr King that the letter that Mrs Gunner signed on 27 January 2012 should be “enforced according to its terms” (see [259] to [268] above).

By his letter of 6 February 2012 (set out at [278] above), Mr Marshall reiterated Mrs Gunner’s demand that Mr and Mrs Lawrence vacate 134 Clontarf Street.

On 21 February 2012, Mrs Gunner commenced proceedings in the CTTT against Mr and Mrs Lawrence seeking possession of 134 Clontarf Street.

The basis on which Mr and Mrs Lawrence resisted that claim was their assertion of the existence of the 134 Clontarf Street Agreement.

For the reasons I set out above, I am not satisfied that any such agreement was made between Mr and Mrs Lawrence and Mr Gunner, or later Mrs Gunner.

Accordingly, I am satisfied that Mr and Mrs Lawrence have no entitlement to continue in occupation of 134 Clontarf Street.

By her cross-claim in these proceedings, Mrs Gunner seeks judgment for possession against Mr and Mrs Lawrence.

Mr King submitted that Mrs Gunner’s claim for possession is “barred” by s 119 of the Residential Tenancies Act 2010 (NSW). Section 119 is in the following terms:

It is common ground that Mr and Mrs Lawrence occupy 134 Clontarf Street pursuant to a “residential tenancy agreement” for the purpose of s 119 (being “an agreement under which a person grants to another person for value a right of occupation of residential premises for the purpose of use as a residence”: s 13(1) of the Residential Tenancies Act. The “value” here is Mr and Mrs Lawrence’s promise to pay outgoings and to effect repairs: see [113] above).

However, in my opinion, by bringing a cross-claim in these proceedings, Mrs Gunner has not “commenced” proceedings contrary to the prohibition in s 119.

The bringing of a cross-claim in proceedings is not “commencing proceedings” in the relevant sense. A cross-claim can only be filed as part of existing proceedings.

Uniform Civil Procedure Rules r 6.2 deals with “how proceedings [are] commenced”, and states that:

Cross-claims are dealt with in a separate part of the rules, namely in Pt 9. Part 9 provides that a party may “make” a cross-claim in proceedings “commenced” by statement of claim or by summons (see UCPR r 9.1).

It is Mr and Mrs Lawrence who “commenced” these proceedings by statement of claim on 5 September 2012. By bringing a cross-claim in the proceedings “commenced” by Mr and Mrs Lawrence, Mrs Gunner has not herself “commenced” separate proceedings against Mr and Mrs Lawrence for recovery of possession of 134 Clontarf Street.

The proceedings that Mrs Gunner did “commence” were those in the CTTT. As I have mentioned, those proceedings were listed for hearing in the CTTT on 13 September 2012. On 12 September 2012, because of the commencement by Mr and Mrs Lawrence of these proceedings, and with their consent, the CTTT vacated the 13 September 2012 hearing date in order that the CTTT proceedings be transferred to this Court to be heard in conjunction with the current proceedings.

Mr King disputed “the existence of such consent or of such orders having effect” and submitted that “the making of the orders by consent or otherwise has not been proved”.

However, the CTTT file is now part of this Court’s records, and reveals that not only did Mr and Mrs Lawrence consent to the orders, but that on 11 September 2012 their then solicitor, Mr Hockey, forwarded the consent orders to the CTTT. The orders were signed by both him and Mr Marshall under cover of a letter which stated:

The orders made by the CTTT on 12 September 2012 were as follows:

Those orders were evidently made in reliance on s 23(1) of the Consumer, Trader and Tenancy Tribunal Act 2001 (NSW) (“the CTTT Act”) which was in the following terms:

The CTTT Act was repealed by s 3(a) of the Civil and Administrative Legislation (Repeal and Amendment) Act 2013 (NSW) with effect from 1 January 2014. On that date, the NSW Civil and Administrative Tribunal (“NCAT”) came into existence and took over the functions of, amongst other tribunals, the CTTT. However, the CTTT Act was in force at the time of the 12 September 2012 consent orders and was the governing legislation on that date. There is, in any event, an equivalent provision to s 23(1) of the CTTT Act in the Civil and Administrative Tribunal Act 2013 (NSW) so far as concerns proceedings in the Consumer and Commercial Division of NCAT (see Pt 6 in Sch 4 of the Civil and Administrative Tribunal Act).

The CTTT’s power under s 23 of the CTTT Act (and NCAT’s power now under the equivalent provision to which I have referred) is to transfer its proceedings to a court “that has jurisdiction in the matter”.

I do not consider that the effect of s 119 of the Residential Tenancies Act 2010 is to prevent this Court from having jurisdiction to deal with this matter. In Whiteford v Commonwealth of Australia (1995) 38 NSWLR 100, Kirby P (as his Honour then was) (with whom Sheller JA agreed) held the predecessor to s 119 (s 71 of the Residential Tenancies Act 1987 (NSW) which was relevantly indistinguishable from s 119) creates a defence to proceedings brought contrary to the terms of the section but “should not be read as denying jurisdiction to the Supreme Court” (at 106; per Sheller JA at 114). That decision was applied by Ward J (as her Honour then was) in Celermajer Holdings Pty Ltd v Kopas [2011] NSWSC 40, in circumstances similar to those in this case; namely, where a lessor commenced proceedings against a lessee in the CTTT and where, on the lessee’s application, the CTTT proceedings were transferred to this Court (at [18]).

However, as Davies J observed in Aboriginal Housing Company Ltd v Kaye-Engel (No. 3) [2014] NSWSC 718, s 81 of the Residential Tenancies Act 2010 (which sets out circumstances of termination of residential tenancies) also requires consideration.

Section 81 of the Residential Tenancies Act 2010 is in the following terms:

As Davies J said, at [19]:

Significantly, and most unfortunately, s 81 does not confer power on a court to terminate a residential tenancy agreement, even if the CTTT or NCAT has transferred proceedings to that court pursuant to the provisions I have mentioned.

Section 83 of the Residential Tenancies Act 2010 provides that if the Tribunal makes an order under s 81 terminating a residential tenancy agreement, it “must also make an order for possession” of the premises specifying a date on which the order takes effect. This suggests a legislative contemplation that an order for possession may not be made unless an order for termination of the residential tenancy has already been made.

In Aboriginal Housing Company Ltd v Kaye-Engel, Davies J at [21] (although cf [30]) expressed the tentative view that the effect of s 81 is that the CTTT did not (and NCAT does not) have power under s 23 of the CTTT Act (and its successor) to transfer proceedings to this (or any other) Court for the reason that the Court does not have “jurisdiction” for the purpose of that section. If that is what Davies J was meaning to convey, I would respectfully disagree. Although, by reason of s 81, only the Tribunal has power to terminate a residential tenancy agreement, I do not think it follows that a court, and this Court in particular, has no jurisdiction otherwise to adjudicate on a dispute concerning a residential tenancy agreement: see [517] above.

My present inclination is that I should make a declaration as to Mrs Gunner’s entitlement to have the residential tenancy agreement between her and Mr and Mrs Lawrence terminated and to have an order for possession, and remit the matter to NCAT for the making of an order under ss 81 and 83 of the Residential Tenancy Act 2010 in accordance with these reasons. This was the course adopted, albeit by consent, by Davies J in Aboriginal Housing Company Ltd v Kaye-Engel.

The parties have, however, not had an opportunity to make submissions in this aspect of the matter; neither counsel drew my attention to ss 81 and 83, or to Davies J’s decision. I will therefore defer further consideration of this question and give the parties an opportunity to address it.

This claim arises out of Mrs Gunner’s evidence, which I accept, that one of the bases upon which she and Mr Gunner were prepared to allow Mr and Mrs Lawrence to occupy 134 Clontarf Street was that they pay all “land tax”.

In her cross-claim, Mrs Gunner claims that Mr and Mrs Lawrence “wrongly failed” to pay “land tax proportional to land tax incurred by [Mrs Gunner] upon 134 Clontarf Street”. An amount of $36,713.33 was claimed as “land tax incurred upon the leased premises on a single holding basis”.

My attention was not drawn in final submissions to any evidence which would warrant me coming to any conclusion as to what land tax Mrs Gunner has incurred referrable to 134 Clontarf Street. Indeed, this aspect of Mrs Gunner’s claim was barely articulated in final submissions. In those circumstances, I am not able to come to any conclusion in relation to it.

As I have set out above, on 19 October 2011 Mrs Gunner, through Mr Marshall, gave notice to Mr and Mrs Lawrence to vacate 134 Clontarf Street by 16 January 2012.

Thereafter, Mrs Lawrence made the application to the Guardianship Tribunal to which I have referred.

Once that matter was resolved and the sale of Beecroft to SLN Developments settled, and following execution by Mrs Gunner of the 27 January 2012 document, Mrs Gunner, again through Mr Marshall, gave notice to Mr and Mrs Lawrence to vacate 134 Clontarf Street by 17 February 2012.

That led to the commencement by Mrs Gunner of the proceedings in the CTTT to which I have referred.

In those circumstances, Mrs Gunner claims mesne profits from 28 January 2012 to date at the rate of $750 per week.

The submissions made on behalf of Mrs Gunner do not identify why the date 28 January 2012 was chosen.

The only material adduced on Mrs Gunner’s behalf to justify the claim of $750 per week was a letter sent to Mr Marshall from Mr Wayne Blackley, the principal of Blackleys Estate Agents in Seaforth, stating his opinion as to rent likely to be obtained for a property such as 134 Clontarf Street.

I do not consider Mr Blackley’s untestable assertion as to rent to be a sufficient basis to make an award of mesne profits.

In any event, I have taken into account Mr and Mrs Lawrence’s rent free occupation of 134 Clontarf Street as a basis upon which to reject Mr Lawrence’s quantum meruit claim. In light of the lack of admissible evidence as to an appropriate weekly rate, I do not consider it appropriate to make any award in Mrs Gunner’s favour in respect of this aspect of her cross-claim.

I have set out above the details of Mr Lawrence’s dealings with Mr Mirosevich concerning the purchase by SLN Developments of the Beecroft property, Mrs Gunner’s purported rescission of the Beecroft contract with SLN Developments, the resolution of that dispute and the concurrent settlement on 3 February 2012 of the sale by Mrs Gunner of Beecroft to SLN Developments at the increased price of $1.2 million and the on-sale by SLN Developments of that property to Henlong for $2.178 million.

That evidence establishes that, in around July 2010, Mr Lawrence agreed to act on Mrs Gunner’s behalf in relation to the sale of her Sydney properties, including Beecroft.

Mrs Gunner trusted Mr Lawrence to act in her interests in relation to her properties. At that point, she had been widowed for a little over a year and needed to sell property to deal with a looming land tax liability. Mr Lawrence was, and is, married to her identical twin sister.

A relationship of trust and confidence therefore existed between Mrs Gunner and Mr Lawrence such as to impose on Mr Lawrence a fiduciary duty. In her cross-claim, Mrs Gunner claims that Mr Lawrence breached that duty.

In the well-known passage in Hospital Products Ltd v United States Surgical Corporation [1984] HCA 64; 156 CLR 41, Mason J (in what is said to be “generally seen as an important and correct statement of principle”: J D Heydon, M J Leeming and P G Turner, Meagher, Gummow and Lehane’s Equity: Doctrines & Remedies, (5th ed 2014, LexisNexis Butterworths) at [5.005]) said, at 96 and 97:

Later, Mason J said, at 107 and 108:

Following his discussion with Mr Mirosevich in September 2010 concerning the Beecroft property (see [151] – [153] above), Mr Lawrence, through Mrs Lawrence, told Mrs Gunner he had received a “good enquiry” (see [154] above) and, in December 2010, told Mrs Gunner that she should sell Beecroft “quickly” because “councils were re-zoning vacant blocks in the area” (see [157] above). In late January 2011, Mrs Lawrence told Mrs Gunner that “Wayne has sold Beecroft” for $600,000, and that because of “council re-zoning” which would have a “big impact on development of the land”, Mrs Gunner was “unlikely to get a better offer” (see [163] above).

That led to Mrs Gunner agreeing to sell Beecroft to SLN Developments for $600,000.

Mr and Mrs Lawrence persuaded, or at least encouraged, Mrs Gunner to sell the Beecroft property to SLN Developments for $600,000 without disclosing their shareholding in SLN Developments (acquired the day before exchange of contracts). Nor did they disclose that, only months before, the property had been valued by Alcon Lupton & Associates at $1.5 million.

In those circumstances, Mr and Mrs Lawrence have made a profit where there was the clearest conflict between their interests as majority shareholders in SLN Developments (in acquiring the Beecroft property as cheaply as possible), and their duty to act in Mrs Gunner’s interests (to obtain, on her behalf, the best price reasonably obtainable). They did not disclose to Mrs Gunner their clear interest in the transaction. No question arose of Mrs Gunner giving her informed consent to Mr and Mrs Lawrence’s position of conflict. They deliberately kept her in the dark.

The profit that Mr and Mrs Lawrence have made is the $315,000 paid to them in the circumstances which I have set out at [294] to [298] above.

The fact that Mr Lawrence caused his share of the profit to be paid to Minsden, effectively his alter ego in the circumstances, is, in my opinion, beside the point (for example see Palmer J in Pedersen v Larcombe [2008] NSWSC 1362 at [497]). The only basis on which Mr and Mrs Lawrence could claim to have a “profit” from the on-sale of the Beecroft property by SLN Developments to Henlong was as shareholders in SLN Developments. That is the capacity in which they received the $315,000 to which Mr Misosevich referred.

I do not accept Mr King’s submission that the $315,000 received by Mr and Mrs Lawrence was comprised in part of $300,000 belonging to Minsden by reason of the rescission of the Nelson Bay contract with SLN Developments. For the reasons I have set out at [297] above, I have concluded that two amounts of $300,000 were paid out of the proceeds of SLN Developments’ on-sale of Beecroft to Henlong. One amount of $300,000 was paid to Walker Hedges & Co (Mr Lawrence’s then solicitors, who were evidently acting for Minsden on the Nelson Bay sale) on settlement of the Beecroft sale. The second amount was paid to Mr Lawrence (albeit, at his direction, also to Minsden) after settlement, and following Mr Lawrence’s conversation with Mr Mirosevich set out at [295] above.

Mr and Mrs Lawrence hold that $315,000 on constructive trust for Mrs Gunner and must now account to her for it.

In or about 31 December 2009, Mrs Gunner engaged Mr Lawrence to do some clearing work at the Old Bar property.

Mrs Gunner accepted that between December 2009 and July 2010, Mr Lawrence undertook “part of the clearing works”.

On 21 April 2010 Mrs Gunner paid Mr Lawrence $50,000 on account of that work. Mrs Gunner claims that, without her authority, Mr Lawrence arranged for subcontractors to “assist with the clearing works”. Mrs Gunner paid those subcontractors an additional $54,406 for the work that they did.

Mrs Gunner claims that Mr Lawrence “failed to complete any substantial part” of the clearing works within a “reasonable period” and that, accordingly, she has suffered loss and damage in the sum of the $50,000 that she paid Mr Lawrence on account of that work.

Mrs Gunner did not allege that there has been a total failure of consideration; indeed, Mrs Gunner accepted that Mr Lawrence did part of the work for which he was paid.

In those circumstances, I cannot see a basis to award Mrs Gunner damages in the amount of the $50,000 that she paid Mr Lawrence, in the absence of evidence that the work he did was of no value.

For those reasons I am not prepared to accept this aspect of Mrs Gunner’s cross-claim.

Mrs Gunner claims that she purchased equipment to assist Mr Lawrence with the clearing of the Old Bar property, including a tractor slasher, a tractor blade with associated hydraulics, and a tractor mulcher attachment.

In her cross-claim, Mrs Gunner claims $32,200 “due to the failure” of Mr Lawrence to return to her that equipment.

The basis on which Mrs Gunner made this claim was not developed in submissions on her behalf and I am not satisfied that the claim has been made out.

This claim relates to a tractor which, according to Mrs Gunner’s cross-claim, was in Mr Lawrence’s possession and which, at her cost, was transported to the Old Bar property and repaired and modified.

Again, this claim was not developed in submissions. My attention was not drawn to evidence that would support any particular award in Mrs Gunner’s favour arising out of these matters.

For these reasons, I am not prepared to accept any part of Mr and Mrs Lawrence’s case.

The amended statement of claim should be dismissed.

So far as concerns Mrs Gunner’s cross-claim, my present inclination is to grant Mrs Gunner declaratory relief to the effect set out at [524] above and remit the matter to NCAT for the making of orders terminating the residential tenancy agreement and for possession. However, as I have stated at [525], I will hear the parties further on this question.

I also propose to enter judgment in Mrs Gunner’s favour against Mr and Mrs Lawrence in relation to the $315,000 profit made by Mr and Mrs Lawrence from the sale of the Beecroft property.

Otherwise, I propose to dismiss Mrs Gunner’s cross-claim.

I will hear submissions from the parties as to what orders should be made to give effect to these reasons and as to costs.