Germanotta v Germanotta & Ors [2012] QSC 116 (30 April 2012)

Last Updated: 2 May 2012

SUPREME COURT OF QUEENSLAND

CITATION:	Germanotta v Germanotta & Ors [2012] QSC 116
PARTIES:	DARIO GERMANOTTA (Plaintiff) v BASILIO FORTUNATO GERMANOTTA (First Defendant) AND MARIA GERMANOTTA (Second Defendant) AND CARLO GERMANOTTA (Third Defendant) AND RENATO GERMANOTTA (Fourth Defendant)
FILE NO/S:	1/2011
DIVISION:	Trial Division
PROCEEDING:	Trial
ORIGINATING COURT:	Supreme Court at Mackay
DELIVERED ON:	30 April 2012
DELIVERED AT:	Rockhampton
HEARING DATE:	12, 13, 14, 15 March 2012
JUDGE:	McMeekin J
ORDERS:	1. I direct the defendants to bring in short minutes of Order reflecting these reasons together with an agreed costs order. 2. If the parties are unable to reach agreement on costs I will hear argument on a date to be fixed.
CATCHWORDS:	EQUITY – ESTOPPEL – GENERAL PRINCIPLES – UNCONSCIONABLE CONDUCT – whether representations made – whether reliance on representations – whether detriment suffered – whether any unconscionable conduct Accurate Financial Consultants Pty Ltd v Koko Black Pty Ltd [2008] VSCA 86 Banner Homes Group plc v Luff Developments Ltd [2000] Ch 372 Baumgartner v Baumgartner [1987] HCA 59; (1987) 164 CLR 137 Cobbe v Yeoman’s Row Management Ltd [2008] UKHL 55; [2008] 1 WLR 1752 Commonwealth v Verwayen (1990) 170 CLR 394 Delaforce v Simpson-Cook [2010] NSWCA 84 Donis v Donis [2007] VSCA 89; (2007) 19 VR 577 Flinn v Flinn [1999] VSCA 109; [1999] 3 VR 712 Gillett v Holt [2001] 1 Ch 201 (CA) 233 Giumelli v Giumelli (1998) 196 CLR 101 Legione v Hately [1983] HCA 11; (1983) 152 CLR 406 Low v Bouverie (1891) 3 Ch 82 Muschinski v Dodds [1985] HCA 78; (1985) 160 CLR 583 Pain v Pain [2006] QSC 335 Riches v Hogben [1985] 2 Qd R 292 Sledmore v Dalby [1996] EWCA Civ 1305; [1996] 72 P & CR 196 CA Thorner v Major [2009] UKHL 18; [2009] 1 WLR 776 Western Australian Insurance Co Ltd v Dayton [1924] HCA 58; (1924) 35 CLR 355
COUNSEL:	D O’Sullivan for the Plaintiff G Crow SC for the Defendants
SOLICITORS:	Barron & Allen Lawyers for the Plaintiff Macrossan & Amiet Solicitors for the Defendants

[1] McMeekin J: The first defendant is Basilio Germanotta (known as “Bill”). Through hard work and careful management he and his wife Maria, the second defendant, have built up substantial assets over the last 44 years. The source of their wealth has been cane farming. As children arrived and grew up they too contributed with hard work on the family farms and, indirectly at least, to the acquisition, conservation and improvement of the family assets.

[2] One of those children, Dario Germanotta, the plaintiff, asserts a right to a one-third share of his parent’s assets which he says should be assigned to him free of debt. He bases that claim on promises or assurances he says were made and on which he has based his life and which he says has caused him to act to his and his family’s detriment. The claims, if accepted, would have the rather startling result that the plaintiff’s parents would be divested of their entire interests in their cane farms, the principal source of their income for over four decades and a significant portion of their assets, and leave to them a substantial debt approaching $1.5M. [1]

[3] The parents reject the claims made on them. Nor is the plaintiff supported by his two brothers, Carlo and Renato, the third and fourth defendants respectively. The claims, if accepted, would affect their interests too, although they would serve to increase, not decrease, their assets, as the plaintiff’s claims would be as applicable to them as to him.

[4] While they reject the plaintiff’s claims I do not think there is any doubt that the parents intended to do their best to set their sons up in life. And nor can there be any doubt that, assuming the sons were dutiful, they intended that at some point they would hand over, to use a neutral term, to their sons. The real issue in the case turns on whether that point has arrived and whether it is just that they hand over at this time and at the insistence of one son.

The Legal Principles

[5] What the plaintiff seeks was described by McPherson J in Riches v Hogben[2] as an “equity of expectation”, a variety of proprietary estoppel. In Giumelli v Giumelli the High Court described the equity in this way:

“In these cases, the equity which founded the relief obtained was found in an assumption as to the future acquisition of ownership of property which had been induced by representations upon which there had been detrimental reliance by the plaintiff. This is a well recognised variety of estoppel as understood in equity and may found relief which requires the taking of active steps by the defendant.”[3]

[6] In a broad sense the plaintiff must show three things – an assurance by the defendants, a reasonable reliance on that assurance, and detriment. The detriment in question is that which he would suffer if the defendants resiled from any assurances made and it “is no narrow or technical concept. It need not consist of expenditure of money or other quantifiable disadvantage so long as it is something substantial. The requirement must be approached as part of a broad enquiry as to whether departure from a promise would be unconscionable in all the circumstances.”[4]

[7] At the heart of the case is a plea that the parents act unconscionably in denying these claims. Deane J, in discussing the concept of estoppel by conduct in Commonwealth v Verwayen, said this of unconscionable conduct:

In this as in other areas of equity-related doctrine, conduct which is "unconscionable" will commonly involve the use of or insistence upon legal entitlement to take advantage of another's special vulnerability or misadventure (cf Stern v McArthur [1988] HCA 51; (1988) 165 CLR 489, at 526-527) in a way that is unreasonable and oppressive to an extent that affronts ordinary minimum standards of fair dealing. That being so, the question whether conduct is or is not unconscionable in the circumstances of a particular case involves a "real process of consideration and judgment" (cf Harry v Kreutziger (1978) 95 DLR (3d) 231, at 240) in which the ordinary processes of legal reasoning by induction and deduction from settled rules and decided cases are applicable but are likely to be inadequate to exclude an element of value judgment in a borderline case such as the present.[5]

[8] I turn then to consideration of the question of whether the parents’ denial of these claims is “unreasonable and oppressive to an extent that [it] affronts ordinary minimum standards of fair dealing”.

[9] For ease of reference, and without meaning any disrespect, I shall refer to the parties by their Christian names.

Separate Issue

[10] I am trying a separate issue. By paragraphs 22 and 23 of his pleading the plaintiff claims a declaration that he is entitled to a one-third interest in certain lands and in the alternative that a one-third interest is held on a constructive or resulting trust in his favour. The lands in question are farmed as cane properties and can be described as follows:

(a) The “Home Farm” consisting of 110 hectares and described as Lot 2 on RP 817083 and Lot 2 on RP 738670 each being in County Carlisle, Parish Homebush, acquired by Bill on 20 November 1967 and held in his name solely;

(b) The “Mezzens Road Farm” consisting of 28.32 hectares described as Lot 5 on RP 735669 County Carlisle, Parish Homebush acquired by Bill on 11 November 1988 and held in his name solely;

(c) The “Davies Farm” consisting of 108 hectares described as Lot 1 on RP 704553 County Carlisle, Parish Homebush and Lot 11 on SP 210487 acquired by the plaintiff and the four defendants on 9 May 1997. Their interests are held as to one-quarter as joint tenants inter se by Bill and Maria and one-quarter by each of the sons as tenants in common.

[11] In paragraph 24 of his pleading the plaintiff seeks in the further alternative “further or other relief as may be appropriate in the circumstances including equitable compensation or damage”. The Northern Judge ordered that the trial for the relief sought in paragraph 22 and 23 of the statement of claim be dealt with separately from the other relief claimed in paragraph 24 of the statement of claim. It is that separate issue raised in paragraphs 22 and 23 which I am to decide.

The Family

[12] Bill is now aged 72 years[6] and Maria 64. I shall refer to them at times as “the parents”. Bill and Maria have four children. The eldest child is a daughter Lina who took no part in the proceedings.

[13] The plaintiff, Dario, is the youngest of Bill and Maria’s three boys. He was born on 5 May 1979 and so is now aged 32 years. He is married to Michelle. They have three children.

[14] Carlo was born on 13 January 1973 and is aged 39 years. He is married to Lisa.

[15] The middle brother in age, Renato, was born on 10 July 1977 and is aged 34 years. He is married to Stacey.

The Assets

[16] The Home Farm was acquired by Bill in 1967 and before he married Maria. He had previously worked on a cane farm with his brother. He was paid $27,000 by his brother when he left to pursue his own path. He used that money to purchase the Home Farm and, over the years, paid off the debt of about $20,000 that he took on to acquire the property and the crop on it. Until ill health forced his retirement from cane farming, Bill and Maria lived on the Home Farm, firstly in a caravan and then in a residence constructed by Bill. They lived there for over 40 years.

[17] The Mezzens Road Farm with its plant and equipment was acquired by Bill in June 1988 for a total sum of $150,000.

[18] By January 1997 any debt on these two properties had been discharged. Bill and Maria then had no debt and substantial assets.

[19] The Davies Farm was acquired in the one-quarter interests that I have described under a contract entered into on 23 January 1997 and settled in May of that year. The purchase price paid was $1,197,200. To acquire the farm $1.4M was borrowed from the National Bank. Additional monies over and above the purchase price were needed to meet acquisition costs and stamp duty. To secure the loan mortgage securities were entered into not only over Davies Farm but also over all the parents’ realty interests – the cane farms, a set of 14 flats, a unit used for town visits - and as well a Bill of Sale was taken over the parents’ plant and machinery.

[20] The crop growing on the Davies Farm was also purchased. The crop was acquired by the Germanotta Family Trust (“the Trust”) for $127,800. The Trust was established in January 1997. Bill and Maria are the trustees and they and their children and grand children are the contingent beneficiaries of the Trust. Thereafter all crops growing on Davies Farm were owned by the Trust. As well, in December 1998, the Trust acquired the crops growing on Home Farm and Mezzens Road Farm and thereafter all crops grown on the family farms were owned by the Trust.

[21] There will be references to Dario working on the family farms. The farms referred to are not only the ones so far mentioned but other properties owned or controlled by the Ollett family that were farmed from time to time. From 1 August 1995 to 31 December 1998 Bill, Carlo and Renato leased and farmed certain land owned by Barbara Ollett. From 1 January 1999 until 31 December 2003 the Trust leased that land. A different parcel of land was leased by all five parties from Barbara Ollett from 1 August 1995, which lease was assigned to the Trust and farmed then by the Trust until 31 December 2006. A different parcel again, this owned by EC Ollett Pty Ltd, was share farmed by the Trust for 5 years until 31 December 2003.[7]

[22] The performance of that Trust is of some significance to my view of the probabilities. The Trust’s net profit (or loss) before tax[8] is as follows:

1999	$116,027
2000	$23,212
2001	($182,288)
2002	($40,380)
2003	($39,183)
2004	($112,291)
2005	$35,401
2006	$117,677
2007	$352,794
2008	$74,839
2009	$61,906
2010	$66,561

Dario’s Case

[23] The case as finally argued, if not actually pleaded, is that seven representations were made to Dario over the years by his father which created in him an expectation that he would receive a one-third interest in the farms owned by the family when his father eventually retired.

[24] In reliance on those representations and “encouraged by the repetition of the substance of them” Dario “worked solely on the Farms full time without wages for thirteen and a half years” from May 1997 to November 2010 save for certain periods mentioned;[9] he moved into and improved by effort and expenditure of monies a small home on Davies Farm, and thereafter remained there;[10] he caused his wife to resume full time work shortly after the birth of each of their children;[11] and he subdivided off a corner of Davies Farm, an area of 7 acres, for the purpose of building a house there, thereby incurring substantial expense.[12]

[25] These various actions were said to be to Dario’s detriment. He arranged his and his family’s life in the ways that I have mentioned and which he otherwise would not have done. He failed to gain alternative employment and qualifications at a mine or in a trade. His commitment to farming the family properties working without wages meant that he could not hold down permanent employment elsewhere and so he could not save and invest and eventually acquire a home and farm of his own. He had to forego superannuation. A measure of his detriment is said to be reflected by the wages he could have earned in the mining industry said to be between $1M and $1.56M over the period since 1997.

[26] The seven representations pleaded were as follows:

(a) At around the time of the purchase of the Davies Farm in 1997 Bill told Dario and his brothers that if they worked on the family farms without wages the income of the farms would be applied to pay off the debts owed in respect of the farms, that the farms would be divided equally between them upon Bill’s retirement, and would then be debt free;

(b) In about May 2000 and at a time when Dario claims that Bill was interested in purchasing a neighbouring farm, the Baulch’s farm, similar promises were made save that now the assurance was that each son would receive a farm of about 100 hectares;

(c) In the course of a meeting at the bank in December 2004, in the context of the sons not receiving a wage or a salary, Bill said words to his sons to the effect that they could wait until he retired and then they would get a debt free farm each;

(d) In the course of a meeting in December 2005 at the Home Farm Bill said words to the effect that the family were trying to pay off the farm mortgage and once it was cleared the plaintiff would receive a farm to run on his own, and that he would be retired in only a few more years and the farms would belong to the sons;

(e) In about January 2008 in a discussion about the Trust paying the partnership for harvesting of the farms’ cane Bill said words to the effect that it made no sense to charge for the harvesting because “the farms are going to be yours when I retire” and that he would retire at 70;

(f) In or about January 2009, again in the context of a conversation about harvesting costs for the farms, Bill said it was not necessary to charge commercial rates because by next season Dario would receive his farm and “the farms are practically yours”;

(g) Between January 2006 and November 2009 at the Home Farm and on a monthly basis and in the context of Dario making enquiries as to the paying off of the farms, asking when would he be likely to start earning money and stating that he needed another home for his family Bill would reply words to the effect “we are paying the farms off and you are going to get a farm you can build your own house on”, “I am retiring at 70”, “it is stupid to pull money out of the farms you are just pulling money put of your own farms it is going to be yours” and “if you are going to pull money out now it is just going to take longer to pay off the farm”.

[27] I note that in the claimed representations (a) to (d), the representation, it is said, was to the effect either that the farms were to be conveyed once the debts were cleared, or perhaps when the time came to transfer the farms the debts would be cleared. The implication of the repeated representations referred to in (g) is to the same effect and arguably in (e) and (f) as well.

[28] If the promises made were to the effect that the farms were to be conveyed once the debts were cleared then Dario has the difficulty that that point in time has not been reached. It seems fundamental that no appeal can be made for equity’s intervention until the time for performance of any promise has come:

“... equitable estoppel [by contrast with contract] ... does not look forward into the future [it] looks backwards from the moment when the promise falls due to be performed and asks whether, in the circumstances which have actually happened, it would be unconscionable for the promise not to be kept.”[13]

[29] If this clearing of the debt was an essential pre condition to any promise it has not been achieved. The debt is presently in excess of $1.4M. On this view of Dario’s case there is nothing more to consider and his claim should be dismissed.

[30] Given the potential ambiguity in the pleaded case I will consider the case on its merits ignoring this point.

Credit Issues

[31] The disputed issues I perceive to be very narrow. I have largely sought to determine the matter on what I see to be the probabilities. But in some instances the presentation of the witnesses has been influential so I shall say something about the witnesses and their reliability.

[32] Easily the two most impressive witnesses were Renato and his former wife, Kylie Rogash. They seemed intelligent, conscious of the issues and able to address the questions asked of them. Renato appeared unconcerned as to the impact of his evidence, for or against the case he was there to support. Ms Rogash, it seems, has no financial interest in the outcome of the case.

[33] The same cannot be said of the other witnesses. Michelle in particular made a poor impression and I am confident that in some respects her evidence was quite unreliable. Her account of statements made by the bank manager, Mr Ian Franklin, in December 2004, that the payment of low wages to the sons was ‘a form of child abuse’ and her allegation that at a family meeting in December 2005 her mother-in-law threw a remote control at her while she was holding a new born baby and then spat in her face I am confident are not true. She was unsupported in these claims by any other witness, and the latter claim, one would expect, would be a very vivid memory for her husband, if true. As well her claims are inherently improbable. In that category is her assertion that Bill said at the December 2004 meeting that the debt could be paid off within three years. There is not the slightest possibility that Bill could have believed such a statement and I think that there was not the slightest possibility that he would say it knowing that he would thereby mislead his sons and bank manager, men who after all he would expect to see through the lie. While the first two claims are hardly central to the issues, these pieces of evidence have the result that I am not prepared to accept anything said by Michelle unless supported by other cogent evidence.

[34] Dario harbours considerable bitterness towards his family. It was not apparent to me from the presentation of the witnesses that this bitterness was reciprocated. He plainly has a feeling of strong entitlement and he came to argue for his claims. While this may be all too human, and completely consistent with an honest belief in his cause, I seriously doubted his reliability. He has the difficulty that his instructions, at least so far as they are reflected by the pleadings, have varied and varied significantly. That can be as much the fault of the pleader as the client, but the variations here are marked and some of substantial significance. As well, features of his evidence were troubling. For example, I cannot accept that Dario has been as ignorant of the financial workings of the farms as he maintains and that he needs to maintain for some claims to have any prospect of acceptance. There were other aspects too, which I will mention, that caused me to doubt his evidence.

[35] Bill is in very poor health. He has emphysema and respiratory failure. He was on an oxygen machine when in Court and sat with his feet elevated. He had poor hearing. He claimed that he had heard very little of the evidence despite being in Court throughout the proceedings and I had no reason to doubt him. Because of his poor health it was agreed that his evidence in chief be given by affidavit. During his evidence he seemed, at times, to be not following the questions at all. I am not sure that he truly appreciated the point of some questions. I thought that he was befuddled at times. I felt sure that he was not attempting to dissemble but his capacity to cope with the questions asked of him and his reliability, at least when in the witness box, was questionable.

[36] Carlo was extremely nervous and agitated when in the witness box. I suspect that he is a man of few words at the best of times. He was all but inarticulate when confronted with questions of even moderate complexity. I am sure he was honest but his focus seemed to be on keeping his time in the witness box as brief as he could. He did not add greatly to my appreciation of the probabilities.

[37] Maria, Lisa and Stacey each gave evidence and each seemed to me to be doing their best to be accurate. Stacey impressed as fair and careful in her evidence. Lisa had little of relevance to say. Maria was passionate at times, but not unreasonably so in the circumstances. I am sure she was honest. But she too added little to my understanding of the relevant issues.

The Representations

[38] Fundamental to the claim is the allegation that the alleged representations were made. The defendants deny they were.

[39] Mr Crow SC who appeared for the defendants submitted that the changing nature of the case brought against his clients, as reflected in the amendments to the pleadings, should be seen as extremely damaging to the plaintiff’s credit.

[40] It is true that the case has changed considerably. Originally it was alleged effectively that there had been a promise that each of the sons would receive a 100ha farm each debt free on Bill’s retirement, which would happen at age 70. The size of the farms and the claimed promise of a retirement at age 70 are not now pursued. Rather the case that seems now to be advanced is that the existing farms should be divided up between the sons and the time for the promise to be fulfilled has come because Bill has in fact retired. The plaintiff’s position on the debt is not quite so clear. As I have pointed out five of the seven pleaded representations, and in context arguably all seven, either explicitly or implicitly allege a promise of a debt free farm.

[41] I bear in mind that what Dario is attempting to do is set out, in a formal way, conversations from long ago where his father was discussing in a general sense the plans he had for himself and his sons. That he has trouble articulating what was said and when is hardly surprising. But the inference that I think it is reasonable to draw is that the pleadings, and for that matter his evidence, reflect very much a reconstruction and a reconstruction performed at a time when Dario’s recollections are influenced by his strong sense of entitlement. So, in that sense, some of the changes to the pleadings do reflect poorly on Dario’s reliability. I will say a little more of that later.

[42] This means that Dario has the difficulty that I am by no means sure that he recalls with any precision the words used by his father. The defendants contended that given the alterations in Dario’s case there was such uncertainty about what was said that any alleged promise lacked the certainty necessary to found an equity. Such uncertainty, however, is not necessarily fatal to his claim. As Brooking JA demonstrated in Flinn v Flinn[14], in his review of the authorities over the last 200 years, the interest promised or expected need not be certain before a Court will consider an equity to be established. If the statements made were “of such a nature that it would have misled any reasonable man, and the plaintiff was in fact misled” by them then that will be sufficient: Low v Bouverie[15]; Western Australian Insurance Co Ltd v Dayton.[16] As Dodds-Streeton JA put it in Accurate Financial Consultants Pty Ltd v Koko Black Pty Ltd: “Equity does not shrink from ascribing meaning to a representation and mere imprecision or loose definition will not preclude a remedy for unconscionability, at which proprietary estoppel is ultimately directed.”[17] This is entirely consonant with the statement of Mason and Deane JJ in Legione v Hately:

“The requirement that a representation as to existing fact or future conduct must be clear if it is to found an estoppel in pais or a promissory estoppel does not mean that the representation must be express. Such a clear representation may properly be seen as implied by the words used or to be adduced from either failure to speak where there was a duty to speak or from conduct. Nor is it necessary that a representation be clear in its entirety...”[18]

[43] But quite apart from the uncertainty created by the changing nature of the case there are several points that count strongly against Bill having made the representations as Dario alleges:

(a) He is not supported by his siblings, or, to the extent they could assist, their wives;

(b) His claim that his father promised him and his brothers each a farm free of debt upon their father’s retirement, whether at age 70,[19] or a few years after the making of the promise,[20] is highly improbable. At some point, and probably from about 2000 on, the statements are not of a sort that Bill was likely to make given his knowledge of the state of the debt, the risks in any farming business, and the profitability of the farming enterprise. The debt at the time of these alleged statements was at a level that Bill would have been well aware could not be paid off in so short a time, at least from the earnings likely to be generated from the farming activities. I am sure that he would not deliberately mislead his son;

(c) For Dario to have interpreted whatever might have been said in the way that he now alleges he did - and I particularly refer here to the paying off of the debt in a few years or five years - requires that he have very little understanding of the financial aspects of cane farming over a very long period, something I have a difficulty accepting;

(d) Dario’s own statements made pre-litigation are not consistent with his present claims - these assurances that he says were given to him, and on which he says he based his life, do not appear in a letter that he wrote to his father dated 2 November 2010,[21] in circumstances where I would have expected him to put these assurances at the forefront of his complaints. It was submitted on his behalf that the adverse inference was not warranted as he had no legal advice in the writing of the letter. But a sense of grievance generated by broken promises is not a lawyer’s device;

(e) Bill would have been conscious of the fact that old age was not far off in 1997. Given that, it seems to me unlikely that Bill would suggest that as part of his contribution he would give up control over his own assets as he and Maria entered old age;

(f) If accepted, Dario’s claims have this peculiar result - all the risk in the venture was to be his parents and all the profit was to be the sons. And this, not to achieve anything that Bill and Maria needed, but to achieve the sons’ goals. Even loving and generous parents, it seems to me, might baulk at such an arrangement.

[44] I will discuss each of the alleged representations in more detail. In considering these representations it is necessary to bear in mind that much is not in issue. Bill and Maria plainly intended to advance their sons and intended to and did apply their earnings to that end. They knew that their sons expected to get their farms one day.[22] What is in issue is whether whatever was said reasonably conveyed to Dario the expectation that he would receive an interest in his parents’ properties at a given time – variously put as upon Bill’s retirement, or at age 70, or upon the farms being debt free.

The First and Second Representations

• At around the time of the purchase of the Davies Farm in 1997 Bill told Dario and his brothers that if they worked on the family farms without wages the income of the farms would be applied to pay off the debts owed in respect of the farms, that the farms would be divided equally between them upon Bill’s retirement, and would then be debt free;

• In about May 2000 and at a time when Dario claims that Bill was interested in purchasing a neighbouring farm, the Baulch’s farm, similar promises were made save that now the assurance was that each son would receive a farm of about 100 hectares.

[45] Dario turned 18 in the May of 1997. He wanted to be cane farmer. He made that plain to his parents. His brothers had the same ambition. It is clear that Bill and Maria wanted to help them all achieve their goals. They were willing to throw their resources into achieving that purpose. So they needed more land. Bill thought that if they worked together they could achieve that goal. The sons’ contribution was to be their work not only on the farm to be purchased but on the parents’ farms as well. Bill was willing to apply the earnings so produced not only from the jointly owned farm but from his farms, to paying off any debt. But this meant that the cash that the family members could take out of the business would be restricted. All this is uncontroversial and was behind the purchase of Davies Farm.

[46] Further I am sure that Bill and Maria intended that if they all worked together then one day the sons would take over the running of the farms and Bill would step back. That in fact was the limit of the representation according to Dario’s evidence.[23] And I am sure that Bill fully intended that one day the sons would inherit his farms. While the evidence is far from clear it seems likely that through the run of life such attitudes would have been apparent to the sons.

[47] Similarly I accept that there probably was discussion about each son one day having a 100ha farm as claimed in representation (b). Bill and his sons each held the view that a farm of that size was needed to support a family and so it would make sense that an acquisition would be discussed. It is not necessary to decide whether Baulch’s farm was the trigger for discussions, or how serious any discussions were, or who was the keener to pursue such a farm. Generally I am guided by Renato’s evidence. And I very much doubt that Bill would have seriously contemplated taking on more debt at the time Baulch’s farm came on the market. The fact is that the purchase was not pursued and Dario could hardly have reasonably based his life on the premise that there were three 100ha farms to divide up one day.

[48] While I accept that there was general discussion about plans and hopes for the future on these two occasions, what I am not prepared to accept is that the words used conveyed in any sense a promise of a retirement at any given age, of a commitment that Bill would convey farms to his sons at any given time, or of a commitment that Bill would ensure that the farms would be debt free at any given time. I refer to the six points that I have mentioned above. I note too that Ms Rogash was adamant that in the period she was involved with Renato from 1998 to May 2005 she heard no mention of Bill retiring one day or of the sons taking over the farms from him on retirement.[24]

[49] What it seems to me Dario has done is to combine two quite separate issues. One is the question of inheritance, and the other is the issue of the joint venture. Plainly Carlo and Renato interpreted any discussions, if there were any, as leaving the timing of any taking over their parents’ property in the hands of their parents. I prefer their evidence. It accords with my perception of the probabilities. It accords with Dario’s apparent acceptance of that right in his letter of 2 November 2010. Bill too denied that the representations were made and so is consistent with his sons Carlo and Renato. I am sure that Dario was told neither more nor less than the other two.

[50] As to the joint venture Bill probably did initially speak with confidence of the future – it would be surprising if he did not. But, as all would have understood, any discussion of the paying down of the debt was in the context of the inherent uncertainties of a farming enterprise. What Dario has done is to convert such talk of hopes and possibilities into assurances and commitments, which acting reasonably he could not do, and which I am confident does not reflect the true effect of the conversations and discussions.

[51] What was not discussed, apparently, was what was to happen if these optimistic hopes did not work out. But the lack of discussion does not mean a lack of awareness of the possibilities.

[52] Dario sought to paint himself in a light of almost complete ignorance of the financial side of the faming enterprise. He did not impress as being unintelligent. It is certainly true that in 1997 he was then young – only 18 and 21 in 2000 – but Dario had spent his entire life on cane farms. To be a farmer was all, it seems, he ever wanted to do and primarily what he had then done from the day he left school.[25] Even before he was actively involved one would expect him to have a lively curiosity about the workings of the farm, the tonnages of crops harvested, the costs of running the farm, and the prices that could be achieved for the crops grown.[26] He would need to be remarkably dull not to know that the harvest would depend on variables beyond the control of the farmer. At age 16 he became actively involved in planting and harvesting and could hardly not have had a good idea of the tonnages achieved. Even at age 18 I am sure he understood not only the day to day workings of the farm but, in a general sense, the financial side of it quite well. And it would be surprising given the apparent closeness of the relationship between father and son[27] if there was not discussion, at least occasionally, about the difficult times and the level of debt. There was with Renato.[28]

[53] As any reasonable person would have understood, and as I am sure Dario did, crucial to the future was the success of the farming venture. Even if Dario was not conscious of the risks being taken on in 1997, I am confident that Bill, with all his experience, was very aware of that risk. The existence of the debt taken on in 1997 would have informed all that Bill said and did. The notion that he would then commit himself unreservedly to the divestment of his own farms at a specified future time seems to me highly improbable in these circumstances.

[54] However, I am confident that Dario at all times understood that the discussions about paying down the debt presupposed that all went well with the joint venture they had all embarked on. And he, I am sure, understood the risks as well as the others.

The Third Representation

• In the course of a meeting at the bank in December 2004, in the context of the sons not receiving a wage or a salary, Bill said words to his sons to the effect that they could wait until he retired and then they would get a debt free farm each.

[55] The meeting at the Bank in December 2004 was called by Ms Kylie Rogash. She was then Renato’s wife and had some familiarity with the family finances. She had concerns about meeting the bills as she was assisting with the family finances then. She wanted a formal meeting between family members and the Bank to seek a way forward. So much I think is not in dispute.

[56] It is in that context then that Dario asserts that his father effectively promised each of his sons a debt free farm upon his retirement. Ms Rogash strongly denied that any such thing was said[29] and, as I have said, she was a most credible witness. What discussion there was she said was in the context of the boys inheriting.[30] But, apart from her evidence the claim is highly improbable.

[57] Bill was, of course, well aware of the state of the debt. It was a serious concern. The family had had a run of terrible seasons. The Trust had lost considerable amounts of money in 2001, 2002, 2003 and 2004. They all knew that. The debt had worsened now for several seasons despite their best efforts. As Renato said there might well have been discussions when the debt was taken on in 1997 of being “a lot stronger” in five years, with the important qualification if they were “good” years.[31] But all understood the context - the reduction in debt that could be achieved depended on many things that were out of the control of all of them not least the seasons, cane prices and the costs. By 2004 there was no realistic prospect of the family having a farm for each son debt free within five years. Bill was far too astute a man to make so rash a promise. And Dario was not so ignorant as not to appreciate the limitations, implicit or explicit, in what was said.

The Fourth, Fifth, Sixth and Seventh Representations

• In the course of a meeting in December 2005 at the Home Farm Bill said words to the effect that the family were trying to pay off the farm mortgage and once it was cleared the plaintiff would receive a farm to run on his own, and that he would be retired in only a few more years and the farms would belong to the sons;

• In about January 2008 in a discussion about the Trust paying the partnership for harvesting of the farms’ cane Bill said words to the effect that it made no sense to charge for the harvesting because “the farms are going to be yours when I retire” and that he would retire at 70;

• In or about January 2009, again in the context of a conversation about harvesting costs for the farms, Bill said it was not necessary to charge commercial rates because by next season Dario would receive his farm and “the farms are practically yours”;

• Between January 2006 and November 2009 at the Home Farm and on a monthly basis and in the context of Dario making enquiries as to the paying off of the farms, asking when would he be likely to start earning money and stating that he needed another home for his family Bill would reply words to the effect “we are paying the farms off and you are going to get a farm you can build your own house on”, “I am retiring at 70”, “it is stupid to pull money out of the farms you are just pulling money put of your own farms it is going to be yours” and “if you are going to pull money out now it is just going to take longer to pay off the farm”.

[58] The controversial elements of the fourth fifth, sixth and seventh representations are the claims of a retirement at a time not far off, or at 70, and, where it is asserted, that retirement would be the trigger for the farms to be transferred. The implication behind the assertions is that there would be a coincidence between the retirement, the debt being paid off and the farms being transferred.

[59] Again Dario has the difficulty that his brothers do not support him in his claims that their father was talking in this way about the future.

[60] Again the performance of the Family Trust makes it highly unlikely such things were said. As at the time of the earliest of these representations in 2005 Bill well knew of the difficulty of achieving the alleged goal. The total annual sum needed to reduce the debt to nil and meet the interest commitments and support the four families had to be well in excess of $300,000 for each year for four years.[32] Bill certainly understood how difficult the task was. I do not think that he would have actively misled his son. Nor do I think that he would have imagined not being involved to see through his plans.

[61] That was the situation in 2005. For the later years the improbability is so much the greater as the debt was not reducing, at least not as needed, and the time period was shortening.

[62] Further Dario has the considerable difficulty that no reasonable person, knowing how difficult the previous years had been, could have believed that anything said about paying off the debt in a few years was anything more than an ambitious hope. And I am sure that Dario had a reasonable idea of the farms’ performance even if he did not enquire as to the precise profit.

[63] Finally, the letter of 2 November 2010 is particularly relevant here. According to its terms it was written to Bill and Maria by Dario and Michelle to explain their decision to leave the family trust. In it they say: “The only reason we decided to cut the block of land off was that 3 years ago Michelle was expecting our third child ...and after discussing with Bill he advised that he was not going to hand over the farms to the sons anytime soon...”[33] Dario’s explanation for this is that he meant the transfer was not going to happen before the third child, Joshua, was born[34] – then a matter of only some months away as Michelle was then expecting Joshua. I find that explanation to be quite unconvincing. Joshua was born in about September 2008.[35] According to Dario he had understood from his father that he was to retire at 70 and so effect transfers in mid 2009. Why then would Dario have any expectation of transfers to occur before Joshua was born? Why would Bill’s non preparedness to hand over the farms in mid 2008 be of any consequence? His answer was plainly adventitious.

[64] Bill’s statement in late 2007 or thereabouts referred to in the letter plainly meant to Dario that Bill was not going to transfer his farms to his sons in the foreseeable future and Dario was making his arrangements accordingly. So, in late 2007 or thereabouts, assuming the letter to be accurate, far from making promises of an early retirement and of handing over the farms, Bill was asserting the contrary. The terms of the letter speak strongly against Dario’s claims that the fifth, sixth and seventh representations were made.

Conclusion re Representations

[65] Mr O’Sullivan, citing Thorner v Major[36] contended, accurately I think, that what is important here is not what Bill intended but what his words and conduct reasonably conveyed to Dario. That Bill spoke encouragingly to his sons and that he had hopes that each could achieve a life as a cane farmer with their own farm, and with his assistance, was no doubt true. But for the reasons that I have endeavoured to explain I am not satisfied that Bill’s statements were reasonably understood by Dario as carrying the essential connotations that he contends for.

[66] Mr O’Sullivan put at the forefront of his argument that he had Renato and Carlo accept at one point in their cross examinations that they had an expectation that on their father’s retirement they would take over the farms – a view consistent with at least one version of Dario’s claimed representations. What the submission ignores, and what the questioning, with respect, avoided, was the context of their answers and the reasons for their views. They each repeatedly said that no assurance or promise had been made to them by their father. So where did the expectation come from? I think that the question and the submission seeks to take advantage of the fact that the sons knew they had loving and generous parents who were demonstrably doing all in their power to advance them. That the sons would take over when the parents had no need of their farms, assuming that they all worked together, I am sure was never in doubt in any of their minds. As Dario said that was the practice in the district.[37] And as Renato, I think, made plain the retirement he had in mind in giving his answer was a retirement at a time of his father’s choosing, not one forced on him unexpectedly through ill health. There is a considerable difference. In the one, Bill gives up the reins when he is satisfied as to the security of his and Maria’s future. In the other he is forced out not only without that security but at the very time when he might need all his assets and the income they produce to meet potential expenses.

[67] Nor am I prepared to accept the submission made that Bill’s readiness to talk to Dario about splitting up his farms in 2010 lends any support to Dario’s claims. It is evident that Dario had a falling out with Carlo by this time and that Bill’s wish that his three sons farm together would not be realised. That Bill would consider his options at that point and see if he could accommodate Dario’s hopes can be said to be consistent with his accepting that he had previously promised to do so, but it is equally consistent with a generous intention to see if he could assist Dario, as he plainly had attempted to do throughout Dario’s life.

[68] Before leaving the subject I am conscious of the argument that the probability of representations having been made might be increased by examination of the life led by the representee – a life of deprivation and little or no reward makes it the more probable that understandings were in place and that all assumed that to be so. That was effectively the submission made by the plaintiff citing the decisions in Pain v Pain [2006] QSC 335 per Ann Lyons J at [56] and Flinn v Flinn [1999] VSCA 109; [1999] 3 VR 712, 734 [67]:

“The evidence endorses the fact that he was clearly not on the properties to earn wages but as part of a common endeavour with greater rewards coming to him in the future. He clearly only stayed in reliance on the original representation as there were no other rewards keeping him there.”

[69] But no inference of that sort can be drawn here. The matter is complicated by the joint venture embarked upon and my view of the probable understandings reached.

[70] It seems to me that the understanding in all probability was this – a joint venture was to be entered. A substantial debt was to be taken on. If the seasons were good and the prices held up then over a period of time the debt would be paid down. That was an essential first step. All family members would contribute as I have discussed. The process might be repeated to provide the sons with a chance of a viable farm each, if all went well.[38] And in due course, whether said expressly in terms of taking over one day, or simply understood, at a time of the parents choosing, the boys would take over the running of the farm and perhaps by inter vivos transfer, perhaps by way of inheritance, the parents’ interests in the cane farms would be transferred to the sons. In the meantime the income generated by the parents’ farms – and the work of all of them - would be devoted to this joint purpose.

[71] The difficulty for Dario then is that, assuming detriment was incurred, there is an alternative and to my mind entirely probable explanation for his incurring it. That explanation lies in an ambitious hope of a capacity to make early debt repayments, the prospect of repeating the exercise, the advantage of the income from his parents’ farms promoting his ambitions and an expectation to the parents’ property at a time of the parents’ choosing.

Detriment

[72] As I am against Dario on his claims that representations were made as he alleges then it follows that the course of his life, and the potential detriments that he can point to, were not the result of his reliance on those representations.

[73] It is not necessary then to examine the claimed detriments in detail but in case the matter goes further findings are necessary.

[74] That Dario has acted on the basis of the discussions held in 2007 at the time of the acquisition of Davies Farm cannot be doubted. I have outlined his claims above. There is no dispute that Dario and Michelle have effected improvements to the cottage on Davies Farm and expended monies in doing so, that the cottage was not ideal for their growing family, that Michelle returned to work as soon as she could following the birth of her first child and continued to work after the birth of their second and third children, and that they expended substantial monies in the order of $44,000 on subdividing off a 7 acre block of Davies Farm on which they intended to build a home. Nor is it controversial that had Dario not expected that the joint venture would result in him being able to earn a living from cane farming one day, he would not have worked on the family farms to the extent he did or for the pay that he did.

[75] Mr O’Sullivan submitted,[39] with extensive citation of authority, the following:

“11. In addition to the loss of an opportunity to take a different career path, detriment in this context has included improving premises in which to live on the farm, living in sub-standard accommodation, long, hard work for little remuneration, having children earlier than would have otherwise been chosen, and relocating to the promised property.

12. Receiving no or low wages counts as a detriment, even if the plaintiff is given other benefits such as free accommodation or farm machinery. Indeed, the conferring of even substantial benefits by the defendant on the plaintiff does not prevent the estoppel arising if the plaintiff has arranged his life, as by working on the property, on the faith of an assurance that it would one day be his. In one case involving a family farm, the court said that ‘I regard the so-called benefit of ‘rent free’ accommodation as substantially irrelevant’.”[40]

[76] Prima facie Dario has a strong case that he has acted to his detriment in the relevant sense as discussed in the authorities on which Mr O’Sullivan relied, assuming that he had acted on the assurances that he pleaded.

[77] However there is a significant debate between the parties whether various matters relied on were “detriments” at all given the motivations at work, quite apart from anything said by the parents, and a very significant debate between the parties concerning a matter that Dario put at the very forefront of his case - that he has not been properly recompensed for work performed over many years. It is necessary to consider the merits, and make findings, on these questions.

Work at an Undervalue

[78] While it is not essential that Dario establish that he worked for an underpayment he advanced that claim strongly as justifying the Court’s intervention. That Dario has contributed by working on the family farms and by taking less in monetary return than he otherwise would have thought fair is not in issue. So have his brothers. The issue relates to the extent of that underpayment which in turn depends on findings about amounts paid and hours worked.

[79] Initially Dario was paid the award wage until the acquisition of Davies Farm in May 1997. While it is Dario’s position that must be considered, he is in no different position to his brothers save that he started work on the farms after them. He commenced working on the properties to a significant extent on leaving school in 1995. There is no submission made that there was any under payment in the years that preceded May 1997. Indeed from age 16 Dario was paid an adult wage and so arguably over paid. But the hours were, at times, long and he did his part.

[80] As originally pleaded Dario’s case was that after the acquisition of Davies Farm he worked “solely on the farms full time for 14 hours per day without wages from on or about May 1997 to November 2010”.[41] If true these facts would go a long way to establishing the case that Dario seeks to make out. But I am satisfied that these claims are not true and far from true.

[81] Putting to one side the claims that he worked solely on the family farms for thirteen and a half years, a claim that was plainly wrong and which might well be the fault of those taking instructions, the relevant point of interest is the claimed lack of any reward. This was denied by the defendants. They assert that Dario was paid $300 per fortnight on the occasions that he worked on the farms.[42] By his Reply Dario asserted that he was paid $150 per week “for a short period of about 10 weeks during the 2005 crushing season” when his wife was pregnant.[43] Such a detailed response can only have come from Dario. I am satisfied that it is quite wrong.

[82] As Mr Crow SC for the defendants pointed out, even as the case commenced it was still unclear what Dario’s position was. A Further Amended Statement of Claim was produced on the eve of trial. Paragraph 5A was introduced. For some time Dario had had his parents’ defence and their disclosure. He now pleaded that he worked on the farms “in return for no payment at all, save on occasions where his father gave him approximately $300 a fortnight during the crushing season, which payments were made irregularly, and in some seasons not at all, and ceased in 2006”. His evidence went further than that but was far from certain.[44]

[83] Bill produced records that he swore reflected payments that he had made to his sons, records that indicated that regular cash withdrawals of $1000 were made and from which he said $300 was paid to each son. Carlo and Renato agreed. So did Ms Rogash. I am confident that Bill would not have treated Dario any differently to the other two sons. As well Bill produced records showing that other substantial sums were withdrawn from his accounts and which he said were used to pay monies to Dario. The monies paid were particularised in Schedule “A” to the Defence and totalled about $41,300.[45] Bill was not cross examined on his claims and to a large extent Dario accepted them in his own evidence. I am satisfied that Bill’s assertions were accurate.

[84] A payment of $150 per week was nonetheless a significant under payment given the hours that were worked. The award rates were $340 per week higher when the arrangement commenced in 1997 and over $500 per week higher by 2006 when the arrangements ceased.[46]

[85] However it is not easy to assess the extent of any underpayment, and so the value of any unrewarded contribution, for a number of reasons. First, Dario worked off farm for considerable periods. According to his own pleading he worked off farm for about half of the thirteen and a half years in question.[47] There is a dispute about the extent of the hours worked when on farm. And, as will be seen, the period after mid 2006 involves different considerations. So simply totalling the award wage and comparing the extent of the cash payments and using the difference as some guide has its difficulties.

[86] Secondly, as just mentioned, there is a dispute about the hours worked when on farm. It certainly was not 14 hours per day every day, and probably not 14 hours on very many days, but Dario’s evidence was that he could work up to 14 hours per day, depending on the jobs that needed doing, and that, I think, was not contested. Dario was criticised by some witnesses for not working as hard as he might have. Ms Rogash’s evidence of moving irrigation pipes when pregnant because Dario was not about was particularly compelling.[48] I think it likely that Dario’s age and probable interests interfered with his work ethic at times. As well, at some point the responsibilities were divided up so that Dario only had the small Mezzens Road farm to irrigate. Carlo and Renato had the larger farms.[49] However his brothers and father were not inclined to complain greatly about any disparity in effort and I do not think this is a significant issue. What this evidence does is to confirm my impression that Dario spoke from a strong sense of entitlement that clouded his perceptions or recall at times.

[87] Bill swore in his affidavit that the usual work load was about 8 hours per day for about 9 to 10 months of the year.[50] Having heard the evidence I am sure that Bill has overstated the number of months worked at that level each year. I will return to that issue. But Bill’s statement is the best guide that I have to the hours typically worked.

[88] What seems clear however is that since mid 2006 Dario has not worked overly long hours on the farm properties. Bill put his impressions this way and I accept his account:

“Since 2006 the only real work that Dario has done on the farms is to assist with planting for about four to five weeks of the year which for the last couple of years has been done in the harvesting season. He would have shifted some irrigation pipes on the Mezzens Road farm only which would take an hour or so for about five days each month for a couple of months in the dry season. There was no irrigating done in 2010. He has not done any work at all since the end of the 2010 crushing season.”[51]

[89] So any reduction in payments from 2006 on has to be put into context that there was a reduction in effort.

[90] Thirdly, in 2006 Bill gifted to his sons machinery of considerable value which they then used to operate a harvesting partnership and which supplied them with an income. The drawings from the partnership were originally $500 per week each and increased over the years to $700 and eventually $800. I will return to this later. For present purposes it is sufficient to note that Dario’s complaints of lack of payment after the gifting of the machinery leave out of account a very substantial benefit and ignore that the gift was well out of proportion to any work required.

[91] Fourthly, the payments that were made were not intended to cover a full year’s work. As mentioned the need to work full time on farm was much less than the whole year. The crucial periods are preparing the ground for planting, planting and harvesting. That takes up about six months of the year, perhaps seven. The oral evidence suggested that the need to work 8 hours per day was largely confined to those periods.[52] For the balance of the year the most significant task seemed to be moving irrigation pipes when necessary. There were odd jobs to attend to such as getting machinery in shape. Otherwise the farmer is more or less at leisure. Hence the pleading that Dario “worked solely on the Farms full time without wages for thirteen and a half years” from May 1997 to November 2010 save for the exceptions mentioned,[53] at its highest meant that Dario led a life that allowed him considerable time for his own pursuits. And a critical point is that the payments that his father made to him were made when he was expected to work in the planting and harvesting, not in the off season. The sons were encouraged by their parents, and I think expected, to find work off farm to supplement their incomes. This Dario did. He never entertained any other expectation.

[92] Assuming, as I think is reasonably accurate, Dario was required to work hard for about half the year on farm, the difference between payments received and award wage up to 2006 is about $86,700.[54] In assessing the alleged unconscionability of the parents’ conduct that provides some guide to the detriment that Dario has suffered by his working for reduced remuneration.

[93] Dario’s claimed contribution of work at an undervalue however was only one aspect of his claims to have suffered detriment. It is necessary to make some brief comment on those other aspects.

A Miner’s Life

[94] One claim was that but for the representations Dario would have had the opportunity to seek work in the mines and the chance of a much higher level of income. That tends to ignore Dario’s expressed intention that he wanted to be a cane farmer and the wish that he and Michelle had that their children grow up in the cane farming environment. It was to achieve that ambition that Bill and Maria exposed all their assets to the risk of the massive debt taken on in 1997.

[95] The income of a miner might be attractive but there is much to a miner’s life that is not and I am not persuaded that Dario had any great interest in pursuing such a life. Dario led the life that he wanted to.[55]

[96] I am reinforced in that view by the fact that, as the years went by, Dario plainly knew that things were not going well on the farm[56] and yet while he obtained work at the mines he did not seek to persist with it. A continuing belief that the debt on the farms was likely to be paid off in a period of a few years was simply unreasonable and I do not accept that it was in fact entertained by Dario.

[97] Similar observations can be made about any claim to have abandoned a career in a trade. While he said the contrary I am satisfied that Dario had no such ambition.

[98] That Dario now works at Hail Creek mine has come about following, and I think as a result of, the inability of the farming venture, over more than a decade, to consistently produce the returns that he, and the others, had hoped for.

[99] Nor is it right to assume that employment as a miner in years past was for the asking. Mr Straw’s evidence was that there could be hundreds of applicants for advertised positions.[57] Nonetheless Dario probably would have obtained work in the mines if he had persisted. He was successful in doing so in the past and he impressed Mr Straw and presumably would have impressed other potential employers.

Rent Free Accommodation

[100] Dario and Michelle each complained that they had lived for many years in substandard accommodation on Davies Farm. It was plainly not ideal, particularly when the family grew. It was not contested that they had spent monies on the cottage and performed improvements. The parents did the same to make it more liveable for them. The issue here is the motivation for Dario and Michelle living there.

[101] The difficulty for Dario’s argument is that any necessity to live in substandard accommodation brought about by alleged underpayments for work done disappeared long ago. Yet he and his family continue to live in the cottage. It seems there are two motivations. One was the attraction of rent free accommodation. The second was allied to that – Dario and Michelle were keen to improve their asset base. Their gross earnings before tax over the years, as taken from Dario’s tax returns,[58] were:

Year	Michelle	Dario	Total
2004		$27,794	$27,794
2005	$24,480	$52,093	$76,573
2006	$16,974	$32,425	$49,399
2007	$7,715	$1,593	$9,308
2008	$28,753	$16,818	$45,571
2009	$54,112	$13,774	$67,886
2010	$80,558	$31,529	$112,087
2011	$75,000 (E)	$120,000 (E)	$195,000 (E)

[102] While Dario’s taxable income was well down in 2007 it is common ground that he was in fact drawing $500 per week from the partnership in that year.

[103] Dario and Michelle continue to reside in the cottage rent free. Whatever the motivation for living in the cottage it is not lack of income. Dario and Michelle plainly had, and have, the capacity to rent a reasonable size and standard of home if they so chose.

[104] It is relevant too that Dario has another dwelling in which to live. In 2004, he purchased a 3 bedroom home in Mackay for $189,000 or thereabouts. He was then working full time at the mines. He has rented that property since then. It is presently rented for $390 per week. Dario considers it to be a superior standard of accommodation to the cottage in which he and his family live. Dario and Michelle each claimed that they could not afford to move into the home they own in Mackay. That this reflects their own choice between advancing their financial position or enjoying a better standard of accommodation is self evident. Dario’s explanation for remaining in the home given in the course of his cross examination better explains his view and reflects his strong sense of entitlement: “[W]hy should I have to move into town and rent a - or buy my own house when everyone else gets a free house?”[59]

[105] My impression was that Dario and Michelle are strongly motivated to improve their asset position and have been so motivated for many years.

[106] I am not persuaded that the provision of this rent free accommodation was in any real sense perceived by Dario as a detriment. Nor does it appear that anything said or done by Bill has caused them to live there or stay there.

Michelle’s Return to Work

[107] The arguments concerning Michelle’s returning to work after the birth of the children need to be considered too in the context that Dario and Michelle plainly had a wish to increase their asset position.

[108] To 30 June 2005 Dario’s taxable earnings were in excess of $50,000 and he and Michelle had $50,000 in a bank account.[60] Their first child, Alyssa, was born in October 2005. Michelle returned to work, in the sense that she commenced a book-keeping business from home, in December that year.

[109] It is difficult to accept that Michelle was compelled to return to work in the sense of needing to keep the wolf from the door. The parents agree that there was a meeting in late 2005 where Dario and Michelle’s financial position and a need for Michelle to return to work were discussed. It was probably a hard decision – it is for many young women and so probably here. It follows that Michelle probably would not have returned to work until a later time if the farming enterprise had earned more money. However it was not earning money because of a run of poor seasons.

[110] Dario was not induced by Bill into following a cane farmer’s life. That was his wish. I think it right to say that Bill’s representations of a preparedness to put the earnings of his farms towards the joint venture caused Dario to see his best opportunity of achieving his ambition was by working on the family farm and accepting the contractual obligations involved in taking on a substantial debt.

The Subdivision

[111] It is common ground that Dario and Michelle spent a substantial sum, $43,302 and interest of $9,594 it was submitted, on subdividing off a 7 acre plot of land off Davies Farm with the intention of living there. They did so pursuant to a promise that if they met the expenses the block would be theirs. As it happens Bill too has contributed $4,000 to a necessary road acquisition. The land is valued at $225,000. Dario and Michelle abandoned the plan only in the course of a family meeting held to try and reconcile family differences in late 2010.

[112] While expenditure of monies induced by a promise and that would not otherwise have been contemplated can be characterised as a detriment, it is not much of a detriment when your share of the asset base increases in proportion to your expenditure. Still less is it a detriment when your co-owners offer to you the whole of the increase in the asset base. There has been no suggestion of any reneging on the promise to transfer the land – the necessary transfer has been executed and is exhibit 13. The offer of the land has been rejected by Dario. That is a matter for him, but it does not convert the expenditure into a detriment.

[113] Nor can I see that the expenditure has any connection with anything said by Bill about his farms. Both Dario and Michelle wanted their children to enjoy the rural life of a cane farm. This expenditure furthered their plans.

Conclusion re Detriment

[114] I am conscious that some of my analysis trespasses on consideration of the hypothetical question of what might have been had no representation, or a different one, been made. To the extent that this merely shows that Dario might have acted in the same way on the basis of a different promise it is not particularly relevant.[61] The relevance in my view is that these “detriments” are not so clearly detriments at all, and in my view come nowhere near being “of a kind and extent that involves life-changing decisions with irreversible consequences of a profoundly personal nature”[62] that demand equity’s intervention. As Renato said, the life of a cane farmer is a good one, and Dario had the same view.[63]

[115] That Dario worked at an undervalue over a period of nine years is plainly established. That was the significant detriment that he suffered.

Unconscionability

[116] In considering this topic I proceed on the premise, rendered false by my findings, that Dario has acted to his detriment in the sense described in reliance on assurances that he would by now have received one-third of the family farms debt free.

[117] While I have dealt with aspects of the detriment claimed piecemeal it is necessary, as I mentioned at the outset, that the question of detriment “must be approached as part of a broad enquiry as to whether departure from a promise would be unconscionable in all the circumstances.”[64]

[118] I note too that “the relevant detriment is not the loss flowing from non-fulfilment of the promise or assurance” but rather “that which the party asserting the estoppel would suffer, as a result of his or her original change of position, if the assumption which induced it was repudiated by the party estopped”: Delaforce v Simpson-Cook.[65]

[119] Part of that broad enquiry as to whether it is unconscionable for Bill and Maria to seek to retain their interest in their farms necessitates an examination of their contributions over the years.

[120] The contribution made by Bill in terms of effort and by Bill and Maria financially (the contribution of one being attributed to both) to the acquisition of the farms that Dario seeks to have transferred was considerably greater than their sons. By dint of his hard work over many years Bill acquired the original stake that enabled the purchase of Home Farm. Since then Bill worked on the properties until ill health intervened in 2008 – so for over 40 years – and longer than his children have been alive, let alone capable of productive manual work. He had plainly been an astute man through his life and through hard work he had accumulated significant assets.

[121] Maria contributed too in the early days by working on the property and more recently in her capacity as a homemaker for her sons and in her preparedness to take on the care of her grandchildren to enable their partners to work outside the home. That contribution was not insignificant. It is necessary only to consider Dario’s position – he finished his schooling in 1994 but he continued to live in his parents’ home until he married Michelle in 2004. When Michelle came into Dario’s life she too lived with Bill and Maria without payment for about 12 months. As well she was provided with rent free accommodation at the unit in town for a period. Maria continued to wash and iron Dario’s clothes and cook his meals until he married. No board was asked for or given. When Michelle returned to work after having her children Maria cared for them. Bill said that this occurred two to three days per week from the beginning of 2006 until late 2010. Michelle was thus freed to exercise her earning capacity and this enabled her to contribute substantially to her and Dario’s standard of living and asset position.

[122] Turning to financial contributions, while Dario complains of an underpayment in wages he leaves out of account a great deal.

[123] The parents’ contributions to Dario’s standard of living over the years were extensive. On obtaining his driver’s license Dario was given a car – at a cost to his parents of $14,000. While this benefit was prior to May 1997 I am inclined to think that the overall picture is relevant and in any case he enjoyed the benefit well after May 1997. When Dario wanted to upgrade his private vehicle in 2001 Bill and Maria gave him $12,000 towards the purchase price. He was provided with a work utility which he could apply to his personal use with registration, insurance and maintenance costs all met. Insurance on his private vehicle was paid. He was provided with fuel at no cost. These benefits continued until 2011 and to some extent continue to the present time.

[124] As mentioned previously, upon their marriage, Dario and Michelle were provided with rent free accommodation in a house on Davies Farm, a house they have lived in ever since and continue to live in without payment of rent.[66] While considerable complaint was made about the standard of this accommodation it plainly had a value. Bill swore that he received $300 per week rent for that house prior to Dario and Michelle moving in. His assertion was not challenged. Despite that it is evident that the home was in need of some work at that time. I have mentioned that Dario and Michelle improved the dwelling by their work and expenditure of monies - about $9,000-10,000. The parents too spent some $10,000 on improving the home prior to Dario and Michelle moving in. They too helped with the physical work in getting the home into shape, as did other family members including Carlo and Renato. Since moving into the home Bill and Maria have made further contributions totalling a few thousand dollars to improvements to the home.[67] While they have the same one-quarter interest in the home as Dario, it is Dario and Michelle who have benefited directly from these improvements.

[125] When Dario and Michelle were in financial difficulties the parents provided them with significant sums - $4,000 in March 2005, $5000 in January 2006, and a further sum of $5,000 in December 2006, which I have so far left out of account.[68]

[126] The benefits that Dario and Michelle have received to this point in money alone can be seen to be in the tens of thousands of dollars. Provision of a motor vehicle fully found, even though used to an extent on farm business, too is worth in the tens of thousands. The benefit of rent free accommodation – albeit that Dario and Michelle have lived on the Davies Farm in which Dario has a one quarter interest – would be worth hundreds of thousands of dollars.

[127] And the complaint that Dario received little or no monies from 2006 on leaves out of account a matter that I have earlier mentioned and one of Bill’s most generous acts. Because Bill appreciated that his sons were struggling financially he gifted to the sons sufficient equipment to establish a cane harvesting business. While the equipment may have been owned by the Trust the use of the equipment was plainly within Bill and Maria’s control and, according to Bill, acquired by him over the years. In May 2006 a partnership was formed - “Germanotta Bros. Harvesting”- with Renato having a one-third share, Carlo and his wife Lisa having a sixth share each, and Dario and Michelle having a sixth share each. The equipment gifted consisted of two tractors, two BSM tippers and a cane harvester. Bill estimated the value of this equipment at $232,000.[69] Bill used his contacts to get the partnership work in the early times thereby assisting the partnership to cut 90,000 tonnes of cane in that first year.[70] As well Bill loaned the partnership $10,000 to buy a Ford tractor in 2006 and in 2010 he advanced a further sum of $25,000 to help with bank repayments on a harvester. This was not completely altruistic in that Bill had hoped that the sons would apply some of the income received to paying off the debt. That has not happened. Each of the sons drew $500 per week from the partnership in the first year and that sum has increased over the years to $800 per week. Some idea of the value of the gift of this equipment to Dario can be gleaned from the recent payment to him of $178,250 to buy him and Michelle out of the partnership after he brought suit against his brothers. I appreciate the partnership has upgraded its equipment since 2006, and so increased the capital of the partnership, but there would be no partnership interest to sell but for the generosity of the parents.

[128] There has been a quid pro quo. The partnership has harvested the cane on the family farms at less than a commercial cost. In 2006 there was no charge and the Trust provided the fuel used. In 2008 and 2009 the partnership charged the Trust $4.40 per tonne – about $3.30 per tonne below commercial rates. There is a dispute about the 2007 year as to whether there was a reduced charge or no charge. It is not necessary to decide it. In 2010 a normal commercial rate was charged. But even given that benefit to the Trust there was a significant advancement of the sons by the gifting of the equipment.

[129] To this point I have made no mention of the one-quarter interest in Davies Farm to which Dario is entitled. The land was valued at $1.45M in March 2010. Dario made no financial contribution to the purchase price. It was acquired because Bill and Maria were prepared to put up their assets as security for the loan of $1.4M. Dario has made no direct financial contribution to paying off the debt. Apart from Dario’s work on farm at an undervalue he has made no contribution at all to the acquisition of the land. True it is that if the presently outstanding balance of the debt taken on to acquire the property was brought into account his equity would be nil or worse, but that has not come about through any fault of Bill and Maria, quite to the contrary. Indeed Dario himself has brought that about, to some degree, by his intransigence in relation to the Bank’s requirements which I will come to.

[130] Dario’s case, as pleaded, was that he should receive the interest in the properties debt free. So, on that assumption, his one-quarter interest in the Davies farm alone is worth something in the order of $360,000. That can be compared to the value of his contribution that he has made by way of working for less than full remuneration which I have previously referred to as worth something in the order of about $86,700. Assuming his claims were accepted then a transfer to him of his one-quarter interest in Davies Farm alone, unencumbered, would far exceed – by a factor of about four - any contribution he has made. He claims much more than that. The cases warn against too minute an examination of detriment but the lack of proportion is stark. In the alternative to his claim for a constructive trust over one-third of his parents’ lands Dario seeks payment to him of $560,000 as reflecting one-third of the net value of his parent’s assets – an even a greater lack of proportion to his contribution – along with much more.[71]

[131] Related to the existence of that interest are the contributions that the respective parties have made to paying off the debt or the interest on the debt. There is a great disparity in the respective contributions.

[132] Whatever be the level of underpayment for his work, Dario has contributed less by his acceptance of the underpayment than the legal obligation he took on. According to Bill’s affidavit the monthly interest payments have been not less than $8,600.[72] A one-quarter share of the annual interest burden was therefore $25,800 - about the annual net award wage for the years 1997 to 2005. So Dario would have needed to work for no remuneration to meet his share of the interest payments, assuming the award wage reflected a fair return for his work as all appeared to accept. As Mr Crow SC submitted Dario’s case seems to ignore that he has had and continues to have a personal obligation to meet the debt repayments.

[133] Conversely, the parents were willing to put the earnings of their cane farms, and more, towards the debt.

[134] As things transpired, the income generated by the farming activities fell well short of meeting the commitments and it is only through the efforts of the parents in devoting their non farm income and assets to meeting the family commitments that they have prevented the bank from foreclosing long ago. The amount that they have contributed was not specifically proven.[73] Bill mentions the sale of a rental house for $115,000 and application of income received from his and Maria’s flats and this was not contested.[74] Some idea of the extent of the contribution can be gleaned from analysing the bank statements, exhibit 23. It would seem to be in the order of hundreds of thousands of dollars applied from their own independent sources of income.

[135] There is then this peculiarity in the arrangements - a preparedness on the part of the parents to put their non farm resources towards the debt commitment but without any corresponding sense of a like obligation on the part of the sons. There is no suggestion that there was any prior agreement that the parents would so commit their non farm income and assets. As Dario said: “The money made from the farm that was supposed to pay the farms off”.[75] There is the further peculiarity that whilst protesting that they have suffered detriment Dario and Michelle have put their income towards improving their asset position, or attempting to do so, as I mentioned earlier, while the parents have been obliged to reduce their assets and put their income towards saving the joint venture.

[136] It should not be overlooked that these financial contributions were over and above Bill’s physical contributions. Bill worked as hard as he was able in the farming enterprise, perhaps with a greater emphasis on maintaining machinery, particularly in the later years, until ill health intervened in 2008.[76]

[137] It is not possible to make any definitive finding as to the value of all benefits received by Dario and Michelle but there is no doubt that they have benefited, directly and indirectly, to the extent of hundreds of thousands of dollars. Suffice to say that Dario’s pleading left much out of the equation. And any gap in the evidence is a problem for Dario - the onus plainly is on him to demonstrate that his parents, in denying his claim, act unconscionably. The overall impression is that he has been the recipient of a very large degree of generosity from his parents, well out of proportion to any contribution he has made.

[138] There is a final matter to mention. Matters came to a head in late 2010. A meeting was held. Some progress was apparently made to resolving Dario’s concerns. Dario became upset and left the meeting. He had caveats put on all the parents’ assets. He withdrew from the family venture and the necessary work on the farms has fallen to Carlo and Renato. He has refused to execute necessary Commercial Bills in favour of the financier to roll over the debt and the debts are thereby in default. The caveats imposed on the lands have prevented the Bank from refinancing. The family now endures penalty interest rates that have added over $100,000 in interest to the debt burden. All of his actions are plainly contrary to the obligations, both implicit and explicit, that he took on when he entered into the joint venture. That the plaintiff would come to a court of conscience with his own hands so sullied says something of him and again reflects his overwhelming sense of entitlement. Applying the maxim “he who seeks equity must do equity” I consider that his actions are relevant in the assessment of what equity demands of his parents. That these actions were taken after the supposed time for fulfilment of the promise is not relevant: cf. Flinn v Flinn[77] where events after trial and before appeal were considered relevant.

[139] If Dario had established that he had reasonably acted to his detriment on assurances that he would receive his parents’ farms, then the authorities show that prima facie his parents should make good the expectation unless it would appear unjust in all the circumstances. Allsop P has summarised the relevant considerations, in a form useful to the facts in this case, in Delaforce v Simpson-Cook[78]:

“[3] I agree in particular with Handley AJA that the reasons of Gleeson CJ, McHugh, Gummow and Callinan JJ in Giumelli v Giumelli [1999] HCA 10; 196 CLR 101 appear to remove as a governing principle in the relief to be granted in equitable or proprietary estoppel cases the notion of enforcement or vindication only of the “minimum equity”: see Giumelli at 123–125 [40]–[48]. That, of course, does not make irrelevant matters that can assuage the detriment brought about by the resiling from the representation or encouragement by the party concerned. It does mean, however, that relief in such cases is not to be measured by weighing detriment too minutely in order that it be converted into some equivalent of cash or kind, as if one were measuring the consideration for a commercial bargain. Equity will look at all the relevant circumstances that touch upon the conscionability (or not) of resiling from the encouragement or representation previously made, including the nature and character of the detriment, how it can be cured, its proportionality to the terms and character of the encouragement or representation and the conformity with good conscience of keeping a party to any relevant representation or promise made, even if not contractual in character. Equity has always had a place in keeping parties to representations or promises: see for example, Burrowes v Lock [1805] EngR 89; (1805) 10 Ves Jr 470 ; 32 ER 927; Horn v Cole 51 NH 287 ; 12 Am Rep 111 (1868); J N Pomeroy, A Treatise on Equity Jurisprudence Vol 3 (5th ed, 1941) at 179–188 [802]–[803]; R Meagher, J Heydon and M Leeming, Meagher, Gummow and Lehane’s Equity: Doctrine and Remedies (4th ed, 2002) at 556–560 [17–065]–[17–070] and 567–568 [17–110].

[4] Proportionality of the claimed interest or remedy to the prejudice or detriment is undeniably a relevant consideration, and sometimes of considerable importance. It should not, however, be transformed into a necessary constitutive element of a cause of action to be pleaded or proved by the party seeking relief. To do so would elevate one consideration above others, and in particular above the importance of making good an expectation by encouragement or representation: Plimmer v Mayor of Wellington (1884) 9 App Cas 699 at 713–714; Riches v Hogben [1985] 2 Qd R 292; Giumelli at 113–114 [10] and 121–122 [35]. It would tend to equate the analysis to one requiring that the party encouraged receive no more than it can prove that it suffered in detriment. This would see the equity become one of compensation for proved equivalent detriment. The equity is a broader one based on the just and conscionable satisfaction in appropriate fashion of the equity arising from the expectation created in another by encouragement or representation. As Handley AJA says, the role of proportionality is better understood, in a doctrine dealing with the legitimacy or otherwise of resiling from an encouragement or representation that has created an expectation, as assisting in an assessment whether what is claimed or contemplated to be granted is disproportionate or unjust in all the circumstances.”

[140] Consideration of the disparate contributions to the acquisition of the properties, the nature and character of the claimed detriment, the assuagement of that detriment by the parents, the proportionality of the claimed detriment to the terms and character of the encouragement or representation (for this purpose assuming it to be as Dario asserts), the parents’ efforts in coping with the changed circumstances since the joint venture was first embarked upon, particularly in contrast to Dario’s lack of effort, and Dario’s more recent actions that have proved so harmful to his parents, all strongly indicate that the parents do not act unconscionably in rejecting Dario’s claims.

The Vicissitudes of Life

[141] I have left to one side the issue of changed circumstances in the parents’ life. There are two significant matters. The first is the disastrous run of seasons that resulted in the Trust suffering significant losses with the consequence that the debt could not be reduced and the parents’ assets and non farm income were diverted to meeting the debt commitments as well as sustaining the farming enterprise. The second is the onset of Bill’s ill health.

[142] While I have discussed the run of poor seasons and the resultant contributions of the parents in one context above, the point here is a different one. Assuming Dario’s case was otherwise accepted, at least to the extent of the early representations alleged, the issue would arise as to whether equity would permit Bill and Maria to change their minds and renege on their promise in these changed circumstances.

[143] The question arose in a hypothetical way only in Delaforce v Simpson-Cook[79] and Thorner v Major[80]. In the latter case Lord Scott said:

“... inherent in every case in which a representation about inheritance prospects is the basis of a proprietary estoppel claim is that ... the circumstances of the representor ... may change ... If, for example, [the promisor] had become, before his death, in need of full time nursing care, so that he could not continue to live at [the farm] or continue as a farmer and needed to sell [the farm] or some part of it in order to fund the costs of necessary medical treatment and care, it seems to me questionable whether [the claimant’s] equity ... would have been held ... to bar the realisation of [the farm], or some sufficient part of it, for those purposes ... for my part, I doubt it.”[81]

[144] Lord Neuberger in the same case allowed for the possibility of a change of mind “if this ... could be justified by a change of circumstances.”[82]

[145] Handley AJA in Delaforce v Simpson-Cook considered the hypothetical possibility of adverse vicissitudes impacting on the deceased promisor’s life as only relevant, in the circumstances of that case, to “the reasonableness of the plaintiff’s reliance, and the significance of her changes of position”.[83] The significant point there was that the adverse vicissitudes had not in fact come to pass in the life time of the deceased. Where, as here, those vicissitudes have come to pass then it is difficult to conceive of equity ignoring them. As Handley AJA pointed out, in considering what is just contract law does not:

“[89] If and when the enforceability of such a promise does arise in the lifetime of a promisor faced, in compelling circumstances, with the need to resort to the capital value of the property, the doctrine of frustration of contracts may be thought relevant. In Davis Contractors Ltd v Fareham UDC [1956] UKHL 3; [1956] AC 696 at 729 Lord Radcliffe said:

... frustration occurs whenever the law recognizes that without fault of either party a contractual obligation has become incapable of being performed because the circumstances in which performance is called for would render it a thing radically different from that which was undertaken by the contract. Non haec in foedera veni. It was not this that I promised to do.”

[146] Mr O’Sullivan submitted that no account need be taken of such considerations as the parents had substantial other assets – by which he meant the flats and unit.

[147] I cannot accept that is an answer. As to the diminution in assets point, the parents’ circumstances are radically different to that supposed when the joint venture was embarked upon. It is not simply that they have the debt to contend with – and a continuing legal obligation to meet substantial interest with mortgages in place over all their assets. No doubt orders could be framed in some way protecting them. The point would remain however that they have less in assets, and probably very substantially less given the significant payments they have made towards both the debt and the farming venture, given the losses they sustained, than they would have expected to have by this time in their lives to put towards their retirement.

[148] So far as the health issue is concerned the difficulty is that no one knows what lies ahead for Bill. He is plainly seriously ill. He is very likely to need substantial care. Whether he will need to incur significant costs to obtain appropriate medical and nursing care, and possible nursing home admission, and if so for how long and at what cost are all unknown. Whether the capital tied up in those other assets will be sufficient to let him see out his life in a reasonable degree of comfort is not known.

[149] There is the further difficulty that Maria is so much younger and still less can it be known whether what might be left over will be sufficient for her comfort and support in her old age, assuming she out lives Bill, as the probabilities strongly suggest.

[150] It might be said of these two matters, as was said of the break up of the marriage of the young couple in Donis v Donis[84], that such things are foreseeable and Bill could have made the promise, which for this purpose I assume was made as Dario contends, conditional. I think that the point is not a relevant one and it is not relevant because of several essential differences. One is that the two events here go to the very heart of the parents’ capacity to carry out their promise. Another is the very different nature of the probabilities of the occurrence of the events in question. A series of disastrous seasons extending over six seasons was, I am sure, not even in the contemplation of the parties in 1997. The possible break up of a new marriage statistically is very high. A third is that the events here depend on factors beyond the control of the parents. That ability to influence events suggests the obviousness of the precaution to take in the example of young newly weds. A fourth is that the unspoken premise in most families would be that on the occurrence of events like those in question here the children would help their parents, not take their property from them. The need to guard with a condition was unlikely to occur to most. A fifth is that in the Donis example the parents were seeking to influence the daughter-in-law’s decision in a way that was contrary to her then present wishes. Here the parents were seeking to help their son lead the life he wanted to lead. Again the need for a condition would not seem as pressing.

[151] The point was side-stepped in Thorner v Major and not decided in Delaforce v Simpson-Cook. Similarly here, because of my non acceptance of the basic premise underlying Dario’s case, I need make no finding. I merely observe that these considerations seem to me to require the parents to meet an obligation in radically different circumstances than were ever envisaged, assuming Dario’s case to be otherwise accepted. These matters militate strongly against the equitable relief sought and, if there was to be an enquiry into appropriate equitable relief by way of compensation or damages, evidence on these matters would seem to me to be relevant.

Constructive or Resulting Trust?

[152] By his pleading Dario sought in the alternative the imposition of a constructive trust. So far as it applies to the Home Farm and the Mezzens Road Farm, what Dario seeks is a proprietary interest in land antecedently owned by his parents. There is a distinction between cases where parties acquire property as part of a joint venture - as with the Davies Farm – and cases where the land in question is already owned by one of the parties before the joint venture is embarked on. In the latter type of case, assuming no proprietary estoppel arises, a trust will only be imposed where the arrangement is sufficiently certain to be specifically enforced and that on the basis that ‘equity looks on that as done which ought to be done’: Banner Homes Group plc v Luff Developments Ltd [2000] Ch 372; Cobbe v Yeoman’s Row Management Ltd [2008] UKHL 55; [2008] 1 WLR 1752 at 1770-177. No claim is made here that any arrangement was so certain as to be contractually enforceable and so capable of being specifically performed.

[153] As well, absent a proprietary estoppel based on an expectation interest, there is no prospect of a constructive trust being imposed in relation to Davies Farm, at least at the suit of the plaintiff. The applicable principles were explained in Muschinski v Dodds[85] and Baumgartner v Baumgartner.[86] Typically there is a joint venture and the substratum of the venture fails without attributable blame. The principles are applied where party A seeks to retain the beneficial ownership of property acquired through the efforts of A and B, and where it was not intended that A should enjoy the fruits of B’s efforts. The remedy imposed brings into account “any injustice which would result if account were not taken of the disparity between the worth of their individual contributions either financially or in kind”.[87]

[154] Here it can be accepted that Dario has made contributions. And it can be accepted that it was never intended that the parents take the benefit of his contributions. But they do not seek to do so. The converse is the case – Dario seeks to take advantage of his parents’ contributions. By far the greater contribution has been made by the parents. If their contributions were brought into account they would extinguish the contribution that Dario has made. There is no scope for the application of these principles.

[155] No submission was made that any resulting trust arises.

Conclusion

[156] I am trying the separate issues earlier identified and not seeking to determine other possible “relief as may be appropriate in the circumstances including equitable compensation or damage”. Plainly my view is that there is no basis for the affording of any such relief to Dario.

[157] I observe that had I been persuaded that equity should intervene, relevant considerations seem to me to point strongly against the transfer of land in specie to Dario. The farming land Dario claims is used as part of a joint enterprise that Carlo and Renato are apparently willing to pursue. Carlo and Renato continue to live on the larger farms. They are entirely innocent parties and there is no good reason to disrupt their lives. And their relationship with Dario has broken down. Similar considerations moved the High Court to order a cash payment rather than an in specie transfer in Giumelli. As Handley AJA observed in Delaforce v Simpson-Cook:

“Relief may be moulded to recognise practical considerations such as the need for a clean break: Pascoe v Turner [1979] 1 WLR 431 CA, 438–9; Giumelli (above) at 113–4, 125; Gillett v Holt [2001] Ch 210 CA, 237; Jennings v Rice [2003] 1 P & CR 100 CA, 115. The court must also take into account the impact of its orders on third parties and any hardship or injustice they would suffer: Giumelli (above) at 113–4, 125; Flinn v Flinn [1999] 3 VR 712 CA, 749, 750”[88]

[158] The plaintiff is not entitled to the declarations he seeks.

[159] The defendants seek the removal of the caveats. Dario has no proprietary interest justifying the imposition or maintenance of the caveats.

[160] I direct the parties to bring in short minutes of Order reflecting these reasons together with an agreed costs order. If the parties are unable to reach agreement on costs I will hear argument on a date to be fixed.

[1] Debt free was the claim as pleaded – the plaintiff’s counsel, recognising perhaps that he who seeks equity must do equity,,effectively abandoned this claim in his submissions

[2] [1985] 2 Qd R 292 at 300

[3] (1998) 196 CLR 101 at [6]

[4] Donis v Donis [2007] VSCA 89; (2007) 19 VR 577 at 583 [20]

[5] (1990) 170 CLR 394 at 441 Emphasis added

[6] Born 15 June 1939

[7] I have taken the information from Bill’s affidavit Ex 22. In relation to historical matters such as these the affidavit provides the best guide. Plainly a great deal of effort has gone into the preparation of the affidavit and obviously with the assistance of financial and other records. And Bill is in the best position to know – he clearly controlled the family businesses for decades.

[8] Taken from Ex 23 – the tax returns of the Trust – which largely correspond with profit and loss statements for 2005 onwards (Ex 1) tendered by the plaintiff

[9] Para 8 of the Further Amended Statement of Claim

[10] Para 11 and 11A of the Further Amended Statement of Claim

[11] Para 11B of the Further Amended Statement of Claim

[12] Para 11C of the Further Amended Statement of Claim

[13] A passage from the unreported judgment of Hoffmann LJ in Walton v Walton (1994) adopted in Thorner v Major [2009] UKHL 18; [2009] 1 WLR 776 by Lord Walker at p 794 and Lord Neuberger at p 805 and cited by Handley AJA in Delaforce v Simpson-Cook [2010] NSWCA 84 at [81]

[14] [1999] 3 VR 712; [1999] VSCA 109 at [80]- [95]

[15] (1891) 3 Ch 82 at 113 per Kay LJ

[16] [1924] HCA 58; (1924) 35 CLR 355

[17] [2008] VSCA 86 at [135]

[18] [1983] HCA 11; (1983) 152 CLR 406 at 438-439

[19] A recurring theme in the various forms of the pleadings – a claimed promised retirement at age 70

[20] Para 7H of the Further Amended Statement of Claim

[21] Ex 8

[22] T3-104/10-20

[23] T1-38/20-30: “when I retire the farms will be yours to run”; and see at T1-42/30: “why would I work there if I wasn't going to receive a farm or run a farm”

[24] T3-19/50; T3-20/25 – 21/15

[25] T1-31/48; 1-34/25-35

[26] In the 35 years that I have been coming to Mackay cane prices have been a matter of public knowledge and discussion in the area. Some of the evidence suggests that too: Ms Rogash was apparently aware of the price of sugar – T3-4/55; and as Renato observed at one point prices are quoted on the radio: T4-38/10.

[27] T1-32/20. And see T1-46/5-20 where Dario admits to discussions, but only at the early stage when things were going reasonably well. Note too Dario’s evidence that suggests that he knew the loan had not been reduced in late 2004: T1-57/55

[28] T4-38/40-50

[29] T3-6/1-10

[30] T3-20/45 – 21/5

[31] See T4-48/35 and 4-49/1

[32] Mr O’Sullivan put forward an analysis that, if accurate, would have the debt paid off in 5 years – see Ex 28. For the purpose of the exercise Mr O’Sullivan assumed the best of all possibilities: see T3-61 – 63 for his cross examination of Bill Germanotta on the farms’ performance in the years 1997-1999. The point was to establish the reasonableness of Dario’s expectations. There was no evidence however that anyone entertained any expectation that the tonnages assumed would be harvested, or that $29-30 per tonne was achievable in the longer term, or that costs were expected to be maintained at $5-6 per tonne, or that interest rates would be as shown . The schedule does not advance matters greatly. Its usefulness is that it demonstrates a need for profits at over $430,000 for 4 years - a profit not shown to have ever been achieved, on assumptions not disadvantageous to the plaintiff’s case.

[33] See Ex 8

[34] T2-56/25

[35] T2-92/15 – Michelle first learnt that she was expecting at about 30 December 2007

[36] [2009] UKHL 18; [2009] 1 WLR 776 (HL) at [3], [78]

[37] T1-35/20

[38] See Renato’s evidence at T4-47/30-40

[39] Ex 28

[40] Citing where appropriate Giumelli v Giumelli (1999) 196 CLR 101 at 118 [27]; Gillett v Holt [2001] 1 Ch 201 (CA) 233; Flinn v Flinn [1999] VR 712 (CA) 745 [20], [104]; Donis v Donis [2007] VSCA 89; (2007) 19 VR 577 (CA); Pain v Pain [2006] QSC 335.

[41] See para 8.4 of the Amended Statement of Claim

[42] Para 6(k) of the Defence – originally per week but amended to per fortnight

[43] Para 6(k) of the Reply

[44] T1-39/30

[45] 1997 - $3,300; 1998 - $7,000; 1999 - $9,800 (Mr O’Sullivan submitted that the schedule showed $11,000); 2000 - $6,100; 2001 - $5,800; 2002 - $3,400; 2003 - zero; 2004 - $1,000; 2005 - $2,889.50; 2006 - $2,000. The schedule was reproduced as an annexure to Bill’s affidavit – “BFG2” to Ex 22. I have ignored the government assistance received of nearly $16,000 when the farms were unprofitable although they were plainly payments to which the plaintiff became entitled because he derived his income from the farms and were effectively a substitute for Bill’s payments.

[46] See Ex 29 and using gross figures including superannuation

[47] See para 8.1 – 8.4 of the Further Amended Statement of Claim

[48] T3-4/40

[49] T4-9/1-50

[50] Ex 22 para 25

[51] Ex 22 para 37; I am not sure that Dario disagreed: T1-111/45

[52] For example see Renato’s evidence at T4-33/50 – 34/15 for the period in question.

[53] Para 8 of the Further Amended Statement of Claim

[54] The payments made, ignoring the more substantial lump sums, totalled approximately $41,300 (see f/n 46). The award wage would have returned about $128,000 (including superannuation and ignoring tax effects – see Ex 29) assuming six months work each year over the period from 1997 to mid 2006. I ignore the period thereafter as involving little work on farm and adequate reward through other benefits.

[55] For example see T1-110/20; it was interesting that Dario’s evidence when asked what he might have done differently was to put first the option of working at a neighbouring farm: T1-42/40

[56] There are many pieces of evidence to that effect but note T1-39/45: “...because we had another thing from the Government for the - 'cause when there was hard times, the assistant package I think it was, something like that, and they started paying us for two years, and that's when Dad stopped paying us too.” And T1-46/30: “We only had probably two good years when we first bought the farm and then the next - oh, probably eight years were really bad, yeah”

[57] T2-76/53 – note that the transcript is in error – the word “under” should I believe read “into”

[58] I have assumed the accuracy of Ex 30

[59] T1-108/58-109/2; and see T1-110/12. As it happened “everyone” did not get a “free house” - apart from a period of about 18 months, from September 2002 until 2010 Renato lived at a home at Oakenden provided out of his and his wife’s resources.

[60] T2-99/30 – 100/30

[61] Cf. Donis v Donis [2007] VSCA 89; (2007) 19 VR 577 at 595 [58] per Nettle JA

[62] The description Nettle JA thought apt in Donis at pp588-589 [34]

[63] T1-119/58

[64] Donis v Donis [2007] VSCA 89; (2007) 19 VR 577 at 583 [20]

[65] [2010] NSWCA 84 at [41]- [42] per Handley AJA citing Commonwealth v Verwayen [1990] HCA 39; 170 CLR 394, 415 per Mason CJ, 429 per Brennan J, 445 per Deane J; Grundt v Great Boulder Pty Gold Mines Ltd [1938] HCA 58; 59 CLR 641, 674–5

[66] Mr O’Sullivan cited Nettle JA’s judgment in Donis [2007] VSCA 89; (2007) 19 VR 577 at 593 [54] as supporting an argument that rent free accommodation is irrelevant but all depends on the facts. In Sledmore v Dalby [1996] EWCA Civ 1305; [1996] 72 P & CR 196 CA the court held that the plaintiff’s equity based on his improvements had been fully amortized over 18 years of rent free occupation. – cited with approval in Delaforce v Simpson-Cook [2010] NSWCA 84 at [61] per Handley AJA

[67] See Ex 22 para 23

[68] These benefits are detailed in Bill’s affidavit Ex 22 at paras 24, 26 and 34

[69] Ex 22 para 30

[70] T4-35/1-20

[71] See para 21A(ii) of the Further Amended Statement of Claim

[72] Ex 22 para 68. Interest payments have been much greater than that in more recent times.

[73] A schedule was prepared and tendered but only in the course of addresses. Being objected to I felt constrained to reject the tender at so late a stage and given that no direct evidence had been led. Nonetheless the uncontested evidence was that the parents, and only the parents, contributed monies and plainly hundreds of thousands of dollars were required.

[74] Ex 22 para 18

[75] T2-50/25; and see T1-58/35

[76] Ex 22 para 47; Dario did not disagree: T1-130/58 – 131/1

[77] [1999] VSCA 109; [1999] 3 VR 712 at p 752 [128] per Brooking JA

[78] [2010] NSWCA 84

[79] [2010] NSWCA 84

[80] [2009] UKHL 18; [2009] 1 WLR 776

[81] At pp 783-784

[82] At p 802

[83] [2010] NSWCA 84 at [85]

[84] [2007] VSCA 89; (2007) 19 VR 577 at p 586 [27] et al

[85] [1985] HCA 78; (1985) 160 CLR 583

[86] [1987] HCA 59; (1987) 164 CLR 137

[87] Baumgartner v Baumgartner [1987] HCA 59; (1987) 164 CLR 137 at p150

[88] [2010] NSWCA 84 at [60]

Authorities Cited17

Referred to (17)