Valverde v Inch

Before the Court for determination as a separate question (defined by an order made under rule 28.2 of the Uniform Civil Procedure Rules 2005 NSW) are competing claims to the net proceeds of sale of a property (“the Bondi Junction property”) known as 48 Botany Street, Bondi Junction, in the eastern suburbs of Sydney.

At all material times, the Bondi Junction property comprised a residence on a main lot (Lot 2 Deposited Plan 355126) together with, at the rear of that lot, four smaller lots (in different deposited plans, with a frontage to a street running parallel to Botany Street) – all the subject of title registered under the Real Property Act 1900 NSW.

Taken as a whole, the Bondi Junction property was for many years the family home of Maud Maria Inch (“Maud senior”), a widow, who died on 2 September 1968, and her two unmarried children: Maud Inch (“Maud junior”), who died on 23 October 2009, and Cecil Inch, who died on 23 November 2009. There was a third child, Richard; but he died in 1982 and requires no more than a passing acknowledgement. The present proceedings are a contest between the plaintiff and the defendant who, respectively, claim beneficial entitlement to the deceased estates of Maud junior and Cecil.

Cecil was born on 31 January 1918 and, at his death, aged 91 years.

Maud junior was born on 27 April 1919 and, at her death, was aged 90 years.

During her lifetime, Maud senior was the registered proprietor, and sole beneficial owner, of the main lot, Lot 2. The back blocks were acquired by Cecil, and registered in his name as proprietor, as and when they became available; he was the sole beneficial owner of those parcels of land.

By her will, Maud senior appointed Cecil and Maud Junior as her “executors and trustees” and made provision for each of her three children, apparently anticipating that Richard would (as he did) die before his siblings. As events unfolded, Cecil and Maud became entitled under the will as sole beneficiaries of Maud senior’s estate “in equal shares”; that is to say (the plaintiff contends), as tenants in common in equal shares.

Cecil and Maud junior obtained a grant of probate of Maud senior’s will and, by registration of a transmission application made by them (under section 94 of the Real Property Act 1900 as then in force) in their capacity as executors of Maud senior’s estate, they became registered as proprietors of the main lot, in their representative capacity, as joint tenants.

Thereafter, for about 40 years, until they died within a month of each other in 2009, the legal title to the family home remained ostensibly static:

The evidence is silent as to why the main lot was never: (a) transferred from the names of Cecil and Maud junior in their capacity as executors into their names as beneficiaries entitled to the land in their own right; or (b) made the subject of a declaration under section 11 of the Trustee Act 1925 NSW to the same effect.

The defendant contends that the Court should infer from the passage of time that, long before their respective deaths, they completed their executorial duties as legal personal representatives of Maud senior. The plaintiff counters that an impediment to such an inference is their ostensible failure to secure their registration on the title of the main lot in their personal capacities.

On the face of the title to the main lot, implicitly but unacknowledged, they remained registered, as joint tenants, as the legal personal representatives of Maud senior, pursuant to Part 11 of the Real Property Act 1900, entitled “Transmissions”. Consistently with sections 12(1)(f), 82(1) and 96 of the Real Property Act, the fact that they were registered on the title as executors of the estate of Maud Senior was not expressly recorded on the title, beyond a cryptic reference to the identification number of the dealing (the Transmission Application) pursuant to which they came to be registered.

At the time Cecil and Maud junior were registered as proprietors of the main lot, the relevant provisions of Part 11 of the Real Property Act were sections 94(1) and 96.

Sections 94 and 96 of the Real Property Act were in the following terms at the time of registration of Cecil and Maud junior’s Transmission Application (Dealing No. L664082) on 8 December 1969:

Cecil and Maud junior’s Transmission Application (extracted in paragraph 53 below) substantially conforms to the “statutory form” found in the 17th schedule to the Real Property Act at the time the application was registered.

With effect from 1 July 1970, Part 11 of the Real Property Act was amended by the Real Property (Amendment) Act 1970 (Act No. 23, 1970) so that sections 94 and 96 in the old form became (as they remain) sections 93 and 96, in the following terms:

Nothing of consequence for the present proceedings turns upon amendment of Part 11 of the Real Property Act. No party suggests otherwise.

On 11 November 2003 Maud junior (reciting her address as 48 Bondi Street, Bondi Junction) granted a general power of attorney to Cecil and the defendant jointly and severally. It was registered in the Old Systems Deed Register (then governed by the Conveyancing Act 1919 NSW) on 30 January 2009 as Book 451 No 165. It was an enduring power of attorney, certified by a solicitor, Pamela Gaibrielle Suttor, under section 163F(2) of the Conveyancing Act 1919.

According to its terms:

On 18 November 2003 Cecil made a will, prepared by Ms Suttor’s firm, L Rundle & Co. It bears the following features:

On 8 December 2003 Maud junior made a will, also prepared by L Rundle & Co. It bears the following features:

On 2 September 2008 Maud junior executed a new will. It bears the following features:

In 2009 several events giving rise to the current proceedings occurred:

What ultimately happened to the net proceeds of sale of the Bondi Junction property is beyond the scope of this judgment, the parties having agreed that questions of tracing be reserved for determination (if necessary) on another day. However, in broad terms, it can be accepted that the solicitors for the defendant accounted for them to the defendant (ostensibly, as the sole executor and beneficiary of Cecil’s unprobated will), to the exclusion of Maud junior’s estate.

Another question expressly reserved for further consideration is whether, at the time Cecil authorised entry into the contract for sale and carried it into completion (between 12 September and 9 November 2009 inclusive), Maud junior lacked capacity in any sense. That question is reserved against the possibility that, in a later phase of litigation, a challenge might be made to the validity of Maud junior’s will dated 2 September 2008.

The facts that Maud junior moved from the family home to a nursing home on or about 29 May 2009, and that Cecil authorised entry into the contract of sale as an enduring attorney, are accordingly not to be taken, of themselves, as necessarily bearing upon Maud junior’s capacity, or Cecil’s authority to act either as a surviving executor of Maud senior or as Maud junior’s enduring attorney, at the time of sale of the Bondi Junction property.

The contract contained no provision expressly apportioning the price for the sale of the Bondi Junction property between the main lot (the title to which is central to the present controversy) and the rear lots (which, the parties agree, were owned by Cecil alone).

There is no challenge to the authority of Cecil to authorise entry into the contract for sale; but, equally, there is no concession that he was entitled to do so without, as a fiduciary, consulting, and duly serving, the interests of Maud junior.

There is no challenge to the title of the purchaser of the Bondi Junction property, not a party to these proceedings. If any irregularity attended Cecil’s authorisation of entry into of the contract for sale of the property, or his execution of the memorandum of transfer of Lot 2, as attorney for Maud junior, what he did was done under colour of right; the purchaser paid for the land without any suggestion of fraud or other impropriety on her part; and, upon registration as proprietor, she acquired indefeasibility of title: Real Property Act, sections 42, 43 and 43A; Frazer v Walker [1967] 1 AC 569; Breskvar v Wall (1971) 126 CLR 376.

There is no suggestion that the price paid by the purchaser for the Bondi Junction property was other than a fair market price.

The essential controversy underlying the question for separate determination is whether, upon completion of the sale, the estate of Maud junior was beneficially entitled to any part of the proceeds of sale.

In the absence of direct evidence from Cecil or Maud junior, the parties have presented this controversy for determination largely upon available documents: principally, by an examination of documents in a chain of title, starting with Maud senior’s registration as the proprietor of an estate in fee simple in Lot 2 Deposited Plan 355126 and culminating in settlement of the sale of the Bondi Junction property as a whole. Inferences may be drawn from the documents, and the course of events; but care needs to be taken not to fill evidentiary gaps by speculation.

The principal proceedings were commenced by a summons filed on 11 September 2015, met by a cross summons filed on 29 October 2015.

The proceedings were thus commenced four years and two months after the plaintiff (on 12 July 2011) obtained a grant of probate entitling her to administer Maud junior’s deceased estate; nearly (but not quite) six years after completion of the sale of the Bondi Junction property; about 45 years nine months after Cecil and Maud junior were (on 8 December 1969) registered on the title to Lot 2 as joint tenants; and about 32 years 11 months after the death of their brother Richard (on 26 October 1982), when they each became entitled to a one half (rather than a third) share of their mother’s estate.

On 17 March 2016 the Registrar ordered that the proceedings proceed by way of pleadings.

At the time of the hearing of the separate question, the pleadings in the principal proceedings comprised:

On 19 February 2016 the then Applications List Judge made an order in the following terms (adding, as implicit in the separate question, the words “[part of]”):

In the course of hearing that question I made procedural orders to the following effect:

For ease of reference I refer simply to “the defendant” notwithstanding her joinder in the proceedings in two separate capacities.

Although the defendant has not filed an amended defence or an amended statement of cross claim, I proceed to determine the separate question on the basis (expressly agreed by the parties) that a determination of that question should extend to a determination of the question whether the defendant has a defence of laches to the plaintiff’s claim (implicit in the separate question) that the defendant should account for so much of the sale proceeds of the Bondi Junction property as fell, or should have fallen, into the estate of Maud junior.

The parties agree that, if any portion of the sale proceeds is held to have fallen into, and to comprise part of, the estate of Maud junior, then, apart from a determination of the laches question, all consequential questions are reserved for determination in the principal proceedings at a later time.

During the hearing of the separate question I made a formal notation to the effect that it is agreed between the parties that:

At the time of her death Maud senior was registered as the proprietor of an estate in fee simple in Lot 2 DP 355126 (“Lot 2”).

The bundle of rights to which Maud senior was entitled as registered proprietor of an estate in fee simple was that her estate in the land would continue to exist and, as confirmed by sections 44 and 61 of the Wills Probate and Administration Act 1898 NSW (as the Probate and Administration Act 1898 was then called), devolve upon the beneficiaries of her probated will (via her executors): Spark v Meers [1971] 2 NSWLR 1 at 14E-F.

Section 61 provided (and, in substance, still provides) for title to vest in the Public Trustee (now the NSW Trustee) from the date of death until a grant of probate. Section 44 provided (and, in substance, still provides) that upon a grant of probate being made, a deceased person’s property is taken to have vested in his or her executor as from the death of the deceased.

Probate of Maud senior’s will dated 4 February 1963 was granted to Cecil and Maud junior (as the executors and trustees named in the will) on 5 June 1969.

Omitting formal parts, the will was in the following terms (with emphasis added):

Upon the death of their brother Richard on 26 October 1982 (aged 74 years), each of Cecil and Maud junior added to their respective one third shares in the estate of Maud senior an equal one half share of the one third share formerly given to Richard as a life estate. In short, they each became entitled, under Maud senior’s will, to a one half share of her residuary estate.

As earlier noted, probate of Maud senior’s will was granted to Cecil and Maud junior on 5 June 1969.

In support of their application for probate, on 26 May 1969 Cecil and Maud junior swore an affidavit verifying an inventory of Maud senior’s property.

For present purposes, it is sufficient to record that Maud senior died with property other than the Bondi Junction property, details of administration of which are not the subject of more than passing evidence. Whether administration of that other property might bear upon the character in which Cecil and Maud junior held Lot 2 in September – October 2009 was not explored by the parties in any depth.

On 8 December 1969 the Registrar General registered, as dealing number L664082, an “APPLICATION TO BE REGISTERED UNDER THE REAL PROPERTY ACT 1900 (SECTION 94), AS PROPRIETOR OR BY TRANSMISSION”.

The Application took the form of a statutory declaration in the following terms:

With one exception, the application comprises typescript on a printed form. The exception is that the words “as Joint Tenants” in the introductory paragraph of the Application are handwritten. A later search of the title (on 13 August 2009) recorded them, in print, as joint tenants. The handwritten words cannot be taken to have been an unauthorised, late addition to the dealing.

The Application bears a stamp dated 1 December 1969 which reads “NSW Stamp Duty: registration not opposed”. It was evidently lodged with the Registrar General on that same date, by Carruthers Hunter & Co, Solicitors of Sydney.

The land contained in Certificate of Title Volume 5664 Folio 135 is Lot 2 in Deposited Plan 255126.

The evidence does not detail the conveyancing history of the land contained in Certificate of Title Volume 3510 Folio 247.

The evidence does not extend to a copy of Certificate of Title Volume 5664 Folio 135 after registration of Transmission Application registered number L664082.

However, an historical title search records that the land was converted to a computer folio on 26 July 1989, with a consequence that the Certificate of Title reference became instead a reference to Folio 2/355126.

A search of that title reference on 13 August 2009 records Cecil and Maud junior as registered proprietors of an estate in fee simply “as joint tenants” by virtue of the Transmission Application.

The evidence also records that a mortgage (dealing No. AE576446) was registered in favour of Westpac Banking Corporation on 20 April 2009, with a discharge of mortgage (dealing No. AF142430) registered on 24 November 2009. The evidence does not extend to an explanation of that mortgage transaction beyond an indication that the mortgage secured a debt incurred on Cecil’s account.

Also registered on 24 November 2009 was memorandum of transfer AF142431, the memorandum of transfer in favour of the purchaser of the Bondi Junction property.

The Bondi Junction property was sold by auction pursuant to arrangements made by Cecil.

By a contract dated 12 September 2009, (entry into which was authorised by Cecil personally and as attorney for Maud junior) Cecil and Maud junior sold the Bondi Junction property for $2.2 million, with eight weeks allowed for completion of the contract.

A full copy of the contract is not in evidence. However, such a copy having been produced at the hearing, the Court formally recorded the parties’ agreement that the contract contained no provision apportioning the sale price of $2.2 million between Lot 2 DP 355126 and the balance of the Bondi Junction property.

The contract was completed on 9 November 2009.

Upon completion, the purchaser paid to the solicitors for the defendant the balance of the sale price of $2.2 million, after contractual adjustments, and deductions for the deposit paid on the contract date ($220,000) and a payment to Westpac ($204,285.77), presumably in discharge of registered mortgage AE576446.

Read together, the solicitors’ Settlement Statement dated 9 November 2009 and a Trust Account Statement of the defendant’s solicitors (Exhibit C11) record that the payment to Westpac was made on the account of Cecil.

The Trust Account Statement (Exhibit C11) supports an inference that the deposit on sale (less the selling agent’s commission) was released to “the vendor” in advance of completion of the contract, on 22 September 2009.

The evidence does not permit there to be a precise accounting for the whole of the proceeds of sale of the Bondi Junction property, net of reasonable selling costs. Nevertheless:

Upon completion of the sale of the Bondi Junction property the purchaser received:

The first of these memoranda was ostensibly signed by Cecil on his own behalf and, as her attorney (pursuant to power of attorney Book 4561 No. 165), for Maud junior.

Against printed marginal notes “consideration” and “estate”, each memorandum of transfer contained the following statement: “The transferor acknowledges receipt of the consideration of $2,200,000 (being the same consideration as contained in Transfer of even date) and as regards the land specified above transfers to the transferee an estate in fee simple”.

The memoranda did not apportion the $2.2 million sale price for the Bondi Junction property between Lot 2 DP 355126 and the balance of the property.

Transfer AF142431 was registered on the title of Folio Identifier 2/355126, in favour of the purchaser, on 24 November 2009.

Engagement with the question stated for separate determination requires, inter alia, consideration of:

Ultimately, the question stated for separate determination can be determined largely by reference to the particular facts of the case, focussing upon an inferred agreement between Cecil and Maud junior about their respective shares in the net proceeds of sale of the Bondi Junction property.

The present proceedings highlight the need to understand legal expressions in the particular context in which they are used. In these proceedings, that caveat applies to the expression “joint tenancy” and its derivatives.

For the most part, the expression “joint tenancy” can be understood as a form of co-ownership of property contrasted with a “tenancy in common”.

The principal, material difference between a “joint tenancy” and a “tenancy in common” is that, in most cases, a right of survivorship is an integral feature of a joint tenancy but absent from a tenancy in common. Ordinarily, a joint tenant’s right of survivorship, contingent upon surviving a joint tenant, is accompanied by a right to sever the joint tenancy during the lives of the joint tenants, and thereby to convert the relationship between co-owners from one of joint tenancy to one of tenants in common.

On the death of one joint tenant, his or her interest passes to the surviving joint tenant or tenants automatically notwithstanding any disposition of his or her interest which the deceased may have attempted to make by his or her will: BA Helmore, The Law of Real Property in New South Wales (Law Book Co, Australia, 2nd edition, 1966), page 268.

A tenancy in common is a form of co-ownership under which each tenant has a distinct share or interest in property which, owing to the absence of survivorship, may be disposed of by will and, if not disposed of by will, passes on the death of the tenant to his or her executor or administrator for the benefit of persons entitled on intestacy: op cit, page 275. Tenants in common can hold property in unequal shares; joint tenants cannot.

Helmore instructs us that, though joint tenants, as between themselves, have separate rights, as against the world at large they are in the position of a single person: ibid, 267-268. With that introduction, he explains the characteristics of a joint tenancy in the following terms:

The expression “joint tenancy” takes on a different meaning when used in the context of several holders of the office of executor of a deceased estate.

In the case of several executors, in order to enable them to perform their executorial duties, the law gives them a joint interest in all estate assets; that joint interest differs from an ordinary joint tenancy because, not only are all the executors seized of the entire interest, but so is each one; it is a joint tenancy, but of a special kind: Union Bank of Australia v Harrison, Jones & Devlin Limited (1910) 11 CLR 492 at 520-521.

Although executors might be declared to be “joint tenants”, they are also and primarily executors; and the nature of their office does not, for example, permit them to sever their joint interest and to create a tenancy in common: op cit, 521.

The office of executor is one and indivisible, no matter whether it is executable by one or several. When it is said that co-executors are to be regarded as an individual person, it is not meant that all must unite in the performance of each act, but that their official personality is not divisible or distinguishable and that they have individually and collectively all the rights and duties of the office they undertake: ibid 516.

Death, while removing an individual, leaves the property, debts, and claims of the deceased still remaining. His or her nomination of an executor is a request to represent him or her for certain purposes, including the payment of debts, and to do what he or she can no longer do for himself: ibid 515. If a person nominated complies with the request in the manner required by law, he or she thereby becomes an executor, and undertakes the office: ibid 516. Whether an official act be done by one, or some, or all of several executors, it is (generally) equally binding upon all, because in each case the office is discharged, and the testator is fully represented: ibid 518; RS Geddes, CJ Rowland and P Studdert, Wills, Probate and Administration in New South Wales (Law Book Co, Sydney, 1996), pages 405-410.

The special character of an executor, executorial duties and the corresponding entitlements of a beneficiary in an unadministered estate were confirmed by the Privy Council, in Commissioner of Stamp Duties (Qld) v Livingston [1965] AC 694 at 707-708 and 717, in the following terms (with emphasis added):

Upon the death of one of several executors, the office, with its incidents, duties and powers, and the estate and interest in all the property vested in the executors by virtue of their office, devolves upon the survivors or the survivor: Joliffe v Fera [1973] 2 NSWLR 702 at 703.

As to when, and how, the office of an executor may evolve into that of a trustee, the following observations of Latham CJ in Pagels v Macdonald (1936) 54 CLR 519 at 526 provide general guidance consistent with that of the Privy Council in Livingston’s Case:

A question presented by the parties for determination in these proceedings (but, in my assessment, unnecessary to decide) is whether, in relation to land registered under the Real Property Act, an executor of a deceased estate, registered as proprietor of an estate in fee simple, can transform into a trustee (or hold the land for his, her or its own benefit absolutely as a beneficiary) “by merely continuing to hold property” after executorial functions have been performed.

Whether a person appointed as “executor and trustee”, acts in one capacity or the other is generally a question of fact: GE Dal Pont and KF Mackie, Law of Succession (2nd ed, Lexis Nexis Butterworths, Australia, 2017), paragraph [10.46]. At least in relation to personalty (as distinct from realty), the completion of administration of an estate by an executor, and with this the moment at which the executor assumes the role of trustee of undistributed property, has been treated as evidenced by an “assent” on the part of the executor that the particular property is not required for administration purposes and therefore may pass as the will directs: op cit, paragraphs [10.47]-[10.49].

Where the property concerned is land registered under the Real Property Act 1900 (a legislative embodiment of a system of registered land title) controversy attends whether “assent” must be attended by a document registered under the Act: eg, Ford v Simes [2009] NSWCA 351 at [36]-[51]; Consolidated Development Pty Limited v Holt (1986) 6 NSWLR 607 at 615.

Although not, in my view, determinative of the parties’ rights and obligations, that controversy cannot but be noticed in these proceedings because the defendant contends that, by one means or another, without registration of any instrument marking completion of executorial duties or the death of Maud junior, Cecil became beneficially entitled to the whole of the proceeds of sale of Lot 2 as a surviving joint tenant.

To the extent that Cecil and Maud junior were registered as joint proprietors of Lot 2, section 100(1) of the Real Property Act deemed them to be entitled (at law) to the land as joint tenants. On the death of Maud junior, Cecil could have lodged with the Registrar General (pursuant to section 101 of the Real Property Act) a notice of death, upon the registration of which he would have been recorded on the title to Lot 2 as the sole registered proprietor. The title to the land did not bear the endorsement “no survivorship” so as to attract the operation of section 84 of the Real Property Act, requiring (as explained in In re Robertson (1943) 44 SR (NSW) 103) an order of the Supreme Court to effect registration.

Even if he did secure registration of Lot 2 in his own name, the death of his co-executor and his registration as a single proprietor of the land would not, of itself, have freed him of the office and duties of an executor.

Section 27 of the Conveyancing Act 1919 confirms, if confirmation is necessary, that the fact that Cecil and Maud junior were registered on the title to Lot 2 as “joint tenants” did not (as In re Selous; Thomson v Selous [1901] 1 Ch 921 might have suggested) lead to the consequence that (if they had completed their executorial duties) their equitable estate in the land as tenants in common merged with their legal estate as “joint tenants”.

Absent an agreement between them to the contrary, the respective beneficial entitlements of Cecil and Maud junior to, or in respect of, Lot 2 were to be determined by reference to the will of Maud senior. Section 26(1) of the Conveyancing Act 1919 operated to confirm – if confirmation is necessary - that those beneficial entitlements were held as tenants in common in equal shares.

Section 26(2) of the Conveyancing Act did not displace that construction of the will merely because Cecil and Maud junior were named in Maud senior’s will as executors as well as beneficiaries. It simply confirmed – if confirmation is necessary – the general law principle that, in the special sense described in Union Bank of Australia v Harrison, Jones and Devlin Limited (1910) 11 CLR 492, several holders of the office of executor may be described as “joint tenants”.

As was held in Hircock v Windsor Homes (Development No. 3) Pty Ltd [1979] 1 NSWLR 501 at 505-506, there is no inconsistency between section 26 of the Conveyancing Act and section 100 of the Real Property Act. Section 100(1) can be read as applying the incidents of “joint tenancy” to a “joint proprietorship”. The words “who may be registered” do not relate to their state prior to registration, but as a description of their position on registration. The sub-section means: “If two or more persons are registered as joint proprietors of an estate or interest in land under the provisions of [the Real Property Act], they shall have the same rights as if they were joint tenants of a similar estate or interest a common law”.

An executor who, by completion of executorial duties, becomes a trustee of property for a beneficiary does not, by that transformation, cease to be a “fiduciary”, bound in conscience to perform (fiduciary) duties enforceable in equity. Each of an executor and a trustee is a fiduciary because each of them, in his, her or its particular character is a person who is obliged to act for or on behalf of another (a beneficiary) in some particular matter: Paul Finn, Fiduciary Obligations (Law Book Co, 1977; Federation Press, 2016), paragraph [467]. The nature of fiduciary duties might evolve, or vary from case to case; but, as a general proposition, a fiduciary is obliged to act in the interests of the beneficiary, and not otherwise.

Because the Real Property Act (Torrens) system of registered title is not a system of registration of title but a system of title by registration (Breskvar v Wall (1971) 126 CLR 376 at 385-386), where a person, in the character of an executor, secures registration on the title to land under the Act, unless there is an entry on the title that the land is held in a fiduciary capacity (such as may be authorised by section 12(1)(f) of the Act as an exception to the principle, embodied in section 82 of the Act, that trusts are not recorded in the Register), for the purposes of any dealing with the land the executor, as registered proprietor, is deemed to be absolute proprietor of the land: Real Property Act, sections 42 and 96.

Nevertheless, as section 96 of the Real Property Act confirms, the Act is consistent with a beneficiary’s entitlement to enforce equitable rights against a registered proprietor who acquired registration (and, accordingly, via sections 41 and 42 of the Real Property Act, legal title) as an executor and who – whether in the character of an executor or in the character of a trustee– continues to hold that title.

Prima facie, at the time Lot 2 was sold by entry into the contract dated 12 September 2009, Cecil and Maud junior held the legal title to that land (as joint tenants) on behalf of themselves as beneficiaries under the will of Maud senior, as tenants in common in equal shares. With the passage of time, and in the absence of evidence about ongoing administration of the estate of Maud senior, it is more probable than not that, but for the controversial question whether “assent” requires the formality of registration under the Real Property Act, they held legal title as trustees for themselves rather than as executors of Maud senior’s estate. Nothing of significance turns on this.

At the time the contract was entered into, and ostensibly performed, in September – October 2009 no consideration appears to have been given to whether an executor or trustee could act through the donee of a power of attorney. An assumption might have been made by the parties’ solicitors, from the form of the folio identifier relating to Lot 2, without full inquiry, that Cecil and Maud junior held that land at law and in equity, as joint tenants, not as executors or trustees. Just as likely, the power of attorney held by Cecil was assumed, without contemporaneous challenge, to clothe him with plenary authority to act on behalf of Maud junior, whatever may have been the true character of their co-ownership of the land. Such speculation aside, Cecil’s deployment of his power of attorney (irregular or not) added a layer of fiduciary obligations to any he may have otherwise have owed to Maud junior arising from the nature of their co-ownership of Lot 2.

Given the adaptability of fiduciary relationships, nothing of substance turns upon whether, as a matter of form, completion of their executorial duties required that, on the face of the title, Cecil and Maud junior either secured registration of a memorandum of transfer in their favour or registration of a declaration under section 11 of the Trustee Act. Equity looks to substance over form. If an application had been made by or on behalf of Maud junior for equitable relief against Cecil at the time of entry into the contract, it would have been open to the Court to hold that the two registered proprietors held Lot 2 as trustees for themselves as testamentary beneficiaries, tenants in common, despite the fact that there remained outstanding a formal, final step in administration of Maud senior’s deceased estate.

Subject to registration of notice of her death (under the Real Property Act, section 101), Maud junior’s role as an executor or trustee of Lot 2 ended with her death. As between Cecil and Maud junior’s estate, her death did not, of itself, extinguish any beneficial entitlement attaching to her identity. If, at the time of her death, she was entitled to a half share of the property as a tenant in common in equity, that entitlement continued to subsist despite her death, enforceable by her legal personal representative, subject to a grant of representation.

An agreement by joint tenants to sell property does not, of itself and in the absence of evidence of intention, operate as a severance of the joint tenancy; but an agreement to sell and to divide the proceeds of sale may do so: Scott v Scott [2009] NSWSC 567 at [59]-[61]. If Cecil and Maud junior held Lot 2 beneficially as joint tenants rather than as tenants in common pursuant to their mother’s will, it was open to them to sever their joint tenancy by an agreement to sell the property and divide the proceeds of sale.

More to the point, perhaps, in these proceedings, the fact that Cecil delivered to the purchaser a memorandum of transfer signed by him on behalf of Maud junior (a dead principal) is not without significance.

Cecil allowed settlement of the sale of the Bondi Junction property to take place, vis a vis the purchaser, on the basis that he was entitled to join in execution of the memorandum of transfer as attorney on behalf of Maud junior. He did not assert that, by reason of the death of Maud junior, he was beneficially entitled to the whole of Lot 2 in his own right. Although, strictly, his authority as Maud junior’s attorney came to an end with her death, his completion of the sale, ostensibly on her behalf as well as on behalf of himself, is consistent with recognition in him that Maud junior’s beneficial interest in Lot 2 was that of a tenant in common, not that of a joint tenant.

It is not necessary in these proceedings, to consider whether (if Maud junior’s interest as a co-owner of Lot 2 was that of a joint tenant to which a right of survivorship attached) Cecil’s entry into the contract for sale on her behalf, pursuant to an enduring power of attorney, was sufficient, in equity, to sever any joint tenancy. This is not, as was Smith v Smith [2017] NSWSC 408 at [299]-[318], a case in which a joint tenant of property (holding an enduring power of attorney, on behalf of another, mentally incompetent joint tenant) effected a sale of the property for his or her own benefit in breach of fiduciary obligations owed to the joint tenant in need of protection. By his manner of completion of the contract for the sale of the Bondi Junction property, Cecil implicitly acknowledged a subsisting interest of Maud junior (more accurately, the estate of Maud junior) in the sale proceeds.

In my assessment, the correct inference to be drawn from the facts is that, on and after 16 October 2009, if not throughout their period of co-ownership of Lot 2 (in whatever capacity) following the death of Richard, Maud junior and Cecil were in agreement that (pursuant to their mother’s will) they each held a beneficial entitlement to that land as tenants in common in equal shares.

By inference, confirmatory evidence of that agreement, and of an agreed apportionment of the sale price of the Bondi Junction property between Lot 2 and the back lots owned by Cecil, can be found in the entry for 16 October 2009 recorded in the Trust Account Statement (Exhibit C11) of the solicitors (the defendant’s solicitors in these proceedings) who acted for both Maud junior and Cecil on the sale. That entry cannot be discounted, as the defendant would have it, as an inconsequential administrative record of the solicitors. It must be taken as evidence of instructions given to the solicitors by Cecil and Maud junior, or by Cecil on behalf of Maud junior and himself. So read, it is evidence of an agreement between Cecil and Maud junior.

At a time when Maud junior was alive (and represented by Cecil as her attorney, and by the same solicitors as Cecil on the sale of the Bondi Junction property), Cecil received a payment from the solicitors’ trust account, funded by the deposit paid by the purchaser of the property, described as “Cecil’s share of deposit (60%)”.

That payment, so described, speaks at two levels.

First, it acknowledges that Maud junior had an identifiable, separate “share” of the deposit and (I infer) the proceeds of sale of the Bondi Junction property generally.

In the context of a contract for the sale of the Bondi Junction property as a whole (five months after Maud junior had moved into a nursing home; and five weeks after Cecil, also at a separate address, had married) this use of language speaks more naturally of co-ownership as tenants in common than it does of co-ownership as joint tenants to which a right of survivorship attaches. Cecil and his sister were parting ways, each with a separate share of family property.

Secondly, apportionment of an “unequal” share of the deposit (that is, 60% rather than 50%) in circumstances in which the main lot of the Bondi Junction property (Lot 2) was in co-ownership but the smaller back lots were owned by Cecil alone, supports an inference (which, in the absence of any plausible alternative explanation, I draw) that it was agreed between Cecil and Maud junior that their beneficial entitlements to the sale proceeds as a whole were to be apportioned, as to 60%, for Cecil and, as to 40%, for Maud junior.

In the decades during which they lived together as siblings following the death of their mother, and their registration on the title of Lot 2 pursuant to a transmission application consequent upon their mother’s will, it was open to Maud junior and Cecil to remain registered on the title as “joint tenants” on a common understanding (which I infer they had by at least 16 October 2009) that, as between themselves, they were beneficially entitled to the land, under their mother’s will, as tenants in common in equal shares.

The current edition of Meagher, Gummow and Lehane’s Equity: Doctrines and Remedies (5th ed, 2015, by JD Heydon, MJ Leeming, and PG Turner), at paragraph [38-005], describes “laches” in the following terms (omitting footnotes):

A principal authority for this treatment of the topic is the statement of Lord Selborne in Lindsay Petroleum Co v Hurd (1874) LR 5 PC 221 at 239-240:

Although mere delay, of itself, is insufficient to establish a defence of laches, in a particular factual setting: (a) evidence of delay may support an inference of fact that a plaintiff has waived or released rights belatedly sought to be asserted; (b) delay, coupled with prejudice to the defendant or a third party, may also amount to a defence of laches; or (c) delay may amount to a defence under, or by analogy with, a limitation statute. None of that can be found here.

The defendant’s allegation of laches depends essentially upon characterisation of the period of about 45 years 9 months, between the time Cecil and Maud junior were (on 8 December 1969) registered on the title to Lot 2 as joint tenants and the time when these proceedings were commenced (on 11 September 2015), or the period of nearly 33 years between the death of their brother Richard (on 26 October 1982) and the commencement of the proceedings, as “delay”, passing over: (a) any agreement in the interim between Maud junior and Cecil about the character of their co-ownership of their common residence; and (b) delays in administration of Maud junior’s deceased estate not beyond any limitation period for which the Limitation Act 1969 NSW provides.

In effecting a sale of the Bondi Junction property (and, more particularly, appropriating deposit moneys and effecting a settlement on behalf of “Maude junior” and himself) Cecil proceeded, I find, on the basis that their beneficial entitlements to Lot 2 were governed by their mother’s will, implicitly acknowledging Maud junior’s share of Lot 2 and the personalty into which, by its sale, it was converted.

There is no factual foundation for an application of the doctrine of laches against a claim, on behalf of Maud junior’s estate, to her share (as I have found, 40%) of the net proceeds of sale of the Bondi Junction property.

Accordingly, I answer as follows the question stated for separate determination:

Bringing the deposit into account, the expression “net proceeds of sale” here used is a reference to the sale price of $2.2 million after contractual adjustments, less agent’s commission and any other costs of effecting the sale (not including the payment to Westpac in discharge of its mortgage).

The separate question having been determined in favour of the plaintiff, in the absence of an application for a different form of order, costs should follow the event, with an order that the defendant (in both her capacities) pay the plaintiff’s costs of proceedings on the separate question, to be assessed on the ordinary basis.