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Which case won?

casea
The case for the daughter and son-in-law
  • Mum consented to moving with us to a house outside of town and did so knowing that she wouldn’t get her $220,000 back.
  • We discussed with mum selling the property in town and buying the property 25 kilometres outside of town before we made the purchase.
  • Mum even came with us three times to look at the new property before we bought it and never made any objections.
  • Before buying the property, we specifically asked mum if she wanted to move, and if she did not, whether she wanted her money back. We made sure to have this conversation with mum because we were taking out a large new loan and wanted to be absolutely certain that there were going to be no complications in the future. Mum told us that she wanted to move to the new property and that she didn’t want her money back.
  • If anything, mum was excited about the move. When she saw the property, she said that “it ticks the vast majority of the boxes”.
  • We relied on mum’s assurances that she consented to the move, taking on a bigger mortgage in order to buy the new house. Mum can’t just change her mind now and demand her money back. To do so would be detrimental to us.
  • Mum should be estopped (restrained) from breaking her promise to us.
caseb
The case for the mother
  • I never consented to the move out of town or said that I wouldn’t accept repayment of my $220,000 contribution.
  • In fact, I told my daughter and son-in-law right from the beginning that I didn’t want to move because the house wasn’t a suitable place for me as an 80-year-old.
  • The house is too far from town, where all my friends and other relatives live. It’s on a narrow, steep and windy road, and is isolated, with no shops, hospitals or other medical facilities. It also has no public transport available.
  • It’s true that I saw the house three times before the purchase, but while there, my daughter and son-in-law would take me out to the open area and I would get roasted by them as a gradual intimidation. I felt bullied and thought I had no choice but to move.
  • The court should order that my $220,000 gift be returned to me, because my daughter and son-in-law moved into unsuitable accommodation without my consent.

So, which case won?

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Case A Case B

Case A won. You were right!

How people voted
a54%
b46%

Expert commentary on the court's decision

“This case highlights that when entering into a written agreement, it is important to ensure that it is carefully drafted to cover the parties’ rights and obligations should circumstances change.”
Court rejects mother’s appeal

In the NSW Court of Appeal Supreme Court case Richardson v Lindsay [2019] NSWCA 148, the court rejected the claim made by the mother, Ms Richardson.

The appeals court agreed with the primary judge that Ms Richardson had consented to her daughter and son-in-law, Mr and Mrs Lindsay, buying the property in Lewis Ponds, 25 kilometres outside of Orange.

Further, the Lindsays had relied to their detriment on Ms Richardson’s consent, and it would be unconscionable for Ms Richardson to be allowed to go back on that promise of consent.

Law of estoppel – being restrained from breaking a promise

“Estoppel” is a legal concept most easily understood as “a party being restrained by a court from breaking a promise” not to rely on their strict legal rights.

For an estoppel to be found, there must be an assurance or promise made by party A to party B not to rely on their strict legal rights, and reliance on that assurance or promise by party B. Party B must demonstrate that they have suffered detriment as a result of that reliance, and that it would be unconscionable to allow party A to go back on their promise.

Deed requires house to be located in Orange, but mother consented to move

The appeals court agreed with the primary judge that under the deed of family arrangement, the accommodation was required to be located in Orange.

However, the primary judge also found that although the deed required the house to be located in Orange, through her conduct, Ms Richardson had promised the Lindsays that it was acceptable for them to move from the house in Orange to the new house in Lewis Ponds.

She also indicated that she would not require repayment of her $220,000 gift if they moved.

Daughter and son-in-law’s evidence preferred to mother’s evidence

In coming to this conclusion, the primary judge preferred Mr and Mrs Lindsay’s evidence to that of Ms Richardson.

The Lindsays’ evidence included that although Ms Richardson had travelled with her daughter and son-in-law to see the Lewis Ponds property three times before it was purchased, she never voiced any objections to moving to the new house.

The primary judge also accepted the son-in-law’s evidence that Ms Richardson had told him she wanted the purchase of the Lewis Ponds property to proceed and that she understood that if it did, her daughter and son-in-law would not be able to return her money.

Mr and Mrs Lindsay had other witnesses who testified that Ms Richardson was looking forward to the move and was excited about it.

The primary judge also concluded that Ms Richardson’s bullying claims were greatly exaggerated.

Mother estopped (restrained) from going back on consent

The primary judge accepted that the Lindsays had relied on Ms Richardson’s promise, taking on a larger mortgage and buying the new house.

The primary judge concluded that it would be detrimental to Mr and Mrs Lindsay, as well as unconscionable, to allow Ms Richardson to break her promise and insist on the return of her money.

Accordingly, Ms Richardson was estopped, or restrained, from breaking her promise.

Appeals Court rejects argument that primary judge erred in finding estoppel

On appeal, Ms Richardson said that the primary judge had erred in finding that she was estopped.

She contended that contrary to the primary judge’s finding, she had never said to her son-in-law that she did not require the return of her life savings.

However, the appeals court found that she had not identified in her arguments why the court should overturn the primary judge’s acceptance of Mr Lindsay’s evidence on this point.

The appeals court also stated that Ms Richardson had not challenged the primary judge’s finding that her conduct more generally had manifested her consent to the proposed move. Had she made such a challenge, the court said it would inevitably have failed.

The court found that Ms Richardson had not identified any matters that would cause the court to overturn the primary judge’s finding that the Lindsays had relied on Ms Richardson’s promise of consent.

The court also rejected Ms Richardson’s argument that the primary judge was wrong in finding that Mr and Mrs Lindsay had suffered detriment in reliance on her promise.

Appeals court dismisses mother’s argument that estoppel has exceedingly harsh impact

On appeal Ms Richardson also argued that holding her bound by an estoppel would have an exceedingly harsh impact on her and would deliver a windfall benefit to her daughter and son-in-law.

The harsh impact on her would include loss of “her whole life savings” and loss of “accommodation and caring services”, due to the breakdown in her relationship with her daughter and son-in-law.

The windfall benefit to her daughter and son-in-law would include retaining the $220,000, the increased value of the Orange and Lewis Ponds properties and the additional benefit of not having to provide any of the caring and accommodation services required under the deed.

The court found that this position was based on a misunderstanding that the operation of the deed had come to an end.

In fact, the obligations of the daughter and son-in-law to continue to provide care and accommodation remained in effect.

Further, these were of considerable value to the mother and may in future end up costing the daughter and son-in-law more than the $220,000 they received.

Important to ensure written agreement addresses change in circumstances

This case highlights that when entering into a written agreement, it is important to ensure that it is carefully drafted to cover the parties’ rights and obligations should circumstances change.

In reviewing the deed in this case, the primary judge commented:

…the Deed is a curious document and a little on the cryptic side. For example, the Deed has no provisions for a mechanism for variation. It does not expressly define “Orange” and does not define “suitable accommodation” although it has to be for the Plaintiff and her Carers and their family. Nor does it provide a mechanism for how suitability is to be determined.

Perhaps if Ms Richardson and the Lindsays had been more prescriptive in the deed as to what would happen if one of the parties wanted to move out of town, the family might not have ended up in the unfortunate position of going to court to resolve this disagreement.

NOTICE: This article is accurate as at the time of publication and does not constitute legal advice. Please see our legal notices page for more information. Information related to coronavirus can be outdated very quickly.
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