Darren Charles on and Margaret Joyce on (as Administrators of the Estate of Charles on) v Alfred on

• Jurisdiction: Northern Territory
• Judge: Martin CJ
• Judgment Date: 21 March 2002
• Neutral Citation: [2002] NTSC 18
• Docket Number: FILE NO: 8 of 1997 (9700997)
• Court: Supreme Court
• Date: 21 March 2002

[2002] NTSC 18

SUPREME COURT OF THE NORTHERN TERRITORY

IN THE SUPREME COURT OF THE NORTHERN TERRITORY OF AUSTRALIA AT DARWIN

Judgment of:

Martin CJ

FILE NO: 8 of 1997 (9700997)

Between:

Darren Charles on and Margaret Joyce on (As Administrators of the Estate of Charles on)

Plaintiffs

and

Alfred on

Defendant

REPRESENTATION:

Counsel:

Plaintiffs: J Reeves QC

Defendant: J Kelly

REASONS FOR JUDGMENT

(Delivered 21 March 2002)

1 This case concerns two blocks of land, sections 1453 and 3219, situated in the rural area near Darwin. The title to both blocks has been in the names of brothers, Charles On and Alfred On, as joint tenants for many years (with the exception of a short period brought about by error, as to which, see later).

2 In May 1984 each of the brothers signed separate documents which the plaintiffs say together evidenced a common intention to sever the joint tenancies and effected severance. The defendant denies that the documents expressed such an intention and had that effect.

3 Charles On died on 12 December 1994. The plaintiffs as administrators of his estate seek a declaration that the properties be held upon statutory trust for partition in such manner as the court may deem fit. The defendant says he became entitled to the whole of the estate and the land by survivorship upon the death of his brother. That is the first issue in the case.

4 The defendant also pleads that the plaintiffs are estopped from denying that he is entitled to be registered as the sole proprietor of the land. That estoppel is said to arise from discussions between the parties on 12 February 1996 and subsequent events. That is the second issue.

5 Given the onus attaching to each party in relation to the separate issues, the hearing proceeded to deal firstly with the severance issue and then the estoppel. At the close of evidence and addresses on the severance issue, I said I was satisfied that the plaintiffs had made out their case. The reasons for that decision follow, after which I will return to consider the second issue.

6 Henceforth I will refer to the deceased, with the approval of the administrators, as Charlie On, the name by which he was commonly known. The land in dispute will be referred to as ‘the two blocks’. The plaintiffs are his widow and one of his sons, the administrators of his estate.

7 The evidence-in-chief of each witness was received by way of statement in writing. Each statement was received as an exhibit. Objection to any of the contents of each statement was dealt with as it was tendered. The passages struck out in the exhibits are those in respect of which objections were upheld.

Severance of joint tenancies

8 It is plain from the evidence that the brothers had a number of property interests, solely and jointly, and that matters personal to them caused a falling out. That is common ground between the parties and it is unnecessary to go into detail. However, it led to their each executing the documents in the form of statutory declarations, Charlie On, on 16 May 1984 and Alfred On, on 21 May 1984.

9 The documents were prepared by an accountant, William Fong. He was called by the defendant. I am satisfied Mr Fong did his best to assist the court, but it is plain that most of his evidence understandably was not derived from present, personal recollection of the meeting which took place in May 1984. Rather, he largely reconstructed the events by reference to what was recorded in the statutory declarations prepared by him. As such his evidence carries little weight beyond that he was present at the meeting when the disputes between the brothers were discussed, the dates upon which things were discussed and the order in which they signed the declarations. In so far as his evidence conflicts with the contents of the declarations, I reject it as being inadmissible. Neither party sought to make anything of his evidence.

10 The evidence of Alfred On in regard to that meeting was that at the meeting he said to Charlie On words to the effect:

‘My wife said you could have 473 and also that we should divide all the remaining rural blocks that we own together. I want all the rural blocks finalised and each have our own share of it so that we can go our own way’.

11 He could not recall the exact words used by his brother, but it was to the effect of ‘OK’. He added that they did not use the words ‘joint tenancies’ and ‘tenancies in common’ at the meeting. Both he and his brother used expressions such as ‘all those properties we own together in the rural block’ or ‘those rural blocks we own together’. His recollection was tested in cross-examination, but he adhered to his evidence and I accept the substance of what he said, notwithstanding the lapse in time. The words used are reflected in the documents. The declarations, in the order in which they were signed, follow:

12 It is common ground that there were other properties, lots 470, 469 and 483 in the rural area, the title to which stood in the names of the brothers as tenants in common. Lot 380 stood in the names of their respective wives as joint tenants.

13 The most significant parts of each document is the paragraph beginning ‘In regard to the properties held jointly in both our names … ‘ and the following: ‘This will ensure that both parties have separate titles to their respective properties’. I find that the two blocks were encompassed by the description ‘properties held jointly in both our names’. Alfred On's evidence confirms it. There is a mis-description by reference to the ‘Hundred of Strangways and Colton’. Lot 1453 is in the Hundred Guy, but that does not assume any significance in the case. The error would appear to have arisen because the boundary of the Hundred of Guy and Colton run along the southern boundary of lot 1453. The dispute is about the two blocks.

14 I regard those parts of the document as evidencing an agreement or arrangement between the brothers which fell into two parts. One was what they termed ‘the dissolution of the partnership’ in the properties held jointly in both names, and the other the equal division of all properties to the satisfaction of each brother. Those steps would result in both brothers having separate titles to the properties so equally divided.

15 Both parties agree that the common law in Australia with respect to the severance of a joint tenancy is to be found in ( (1861) 1 J&H 546 Williams v Hensman 70 ER 862) cited with evident approval in Corin v Patton (1990) 169 CLR 540. Mason CJ and McHugh J at p 546 considered the various ways in which a joint tenancy can be severed by reference to the judgment of Page Wood VC in Williams v Hensman:

‘A joint-tenancy may be severed in three ways: in the fist place, an act of any one of the persons interested operating upon his own share may create a severance as to that share. The right of each joint-tenant is a right by survivorship only in the event of no severance having taken place of the share which is claimed under the jus accrescendi. Each one is at liberty to dispose of his own interest in such manner as to sever it from the joint fund — losing, of course, at the same time, his own right of survivorship. Secondly, a joint-tenancy may be severed by mutual agreement. And, in the third place, there may be a severance by any course of dealing sufficient to intimate that the interests of all were mutually treated as constituting a tenancy in common. When the severance depends on an inference of this kind without any express act of severance, it will not suffice to rely on an intention, with respect to the particular share, declared only behind the backs of the other persons interested.’

16 By reference to what was said by Stirling J in In Re Wilks; Chal v Bulmer (1891) 3 Ch 59 at p 61 and p 62, Toohey J, at p 587, pointed out that agreement between joint tenants as to severance may be express or implied from a course of conduct.

17 The plaintiffs submit that whether the language contained in each of the declarations be regarded as evidence of mutual agreement, or a course of dealing sufficient to intimate that the interests of both brothers were mutually treated as constituting a tenancy in common they had the effect of severing the joint tenancies. The manner in which it was agreed that the two blocks should be dealt with operates to bring about the severance, or might reveal the parties' shared intention to sever their joint proprietorship (per Kaye J in Public Trustee v Pfeiffle (1991) 1 VR 19 at p 23). His Honour there referred to Burgess v Rawnsley (1975) Ch 429 where at p 447 Sir John Pennycuick was of the view that it may be possible to infer from negotiations for rearrangement of interests a common intention to sever. That proposition stands notwithstanding the legislation then operating, which sometimes is a reason to distinguish that case.

18 In Sprott v Harper (2000) QCA 391 the Queensland Court of Appeal was dealing with an agreement which obviously envisaged further events occurring before it was completed. The agreement related to division of property between husband and wife and covered a number of matters, including as to a house ‘We do both agree that the property be sold if Larry can not afford to pay me out’.

19 With reference to the third way posed by Page Wood VC, that Court held that it was not a precondition of effecting a severance of a joint tenancy that a binding agreement be made between the parties. It is sufficient if there was a course of dealing to intimate that the interests of all would be treated as constituting a tenancy in common. The court concluded its discussion on this aspect of the matter by saying that the real question is whether the parties have acted in a way that the law regards as inconsistent with the maintenance of joint tenancy. I...