DIPLOMA IN LAW
LEGAL PROFESSION
ADMISSION BOARD
LAW EXTENSION COMMITTEE
LAW EXTENSION COMMITTEE SUBJECT GUIDE
07 EQUITY
WINTER SESSION 2016
This Guide includes the Law Extension Committee’s course information and teaching program and the
Legal Profession Admission Board’s syllabus. The syllabus is contained under the heading
“Prescribed Topics and Course Outline” and has been prepared in accordance with Rule 27H(a) of the
NSW Admission Board Rules 2015.
Course Description and Objectives
Lecturers
Assessment
September 2016 Examination
Lecture Program
Weekend Schools 1 and 2
Texts and Materials
Compulsory Assignment
Assignment Questions
Prescribed Topics and Course Outline
1
1
1-2
2
3
4-5
6
7
7
8-25
1
LAW EXTENSION COMMITTEE
WINTER 2016
07 EQUITY
COURSE DESCRIPTION AND OBJECTIVES
Equity, which includes the law of trusts, considers the historical origins and development of the
equitable jurisdiction, equitable doctrines and the nature and creation of trusts.
The emphasis in the course will be on developing an understanding of the principles of equity and
their practical application. In this respect cases will be discussed and studied, but primarily as
examples of the application of principle, and as a means of understanding particular principles, rather
than as an end in themselves. Students are expected to identify and grasp the equitable issues
arising in a given set of facts and, also, how a court exercising an equitable jurisdiction would deal with
those issues in applying the principles discussed in the course to grant or refuse relief.
At the conclusion of the Equity course, students should be able to:
 Describe the key principles of equity and trusts law;
 Select equitable principles applicable to a given set of facts;
 Apply key principles of equity and trusts to factual scenarios;
 Draw conclusions regarding the likely outcome of applying equitable principles to problems;
 Compare and contrast the common law and equity in Australia; and
 Reflect on the application of equitable principles to real world situations.
LECTURERS
Prof Peter Radan, BA, LLB, PhD (Syd), DipEd (SCAE)
Peter Radan is a Professor of Law at Macquarie Law School. He holds the degrees of Bachelor of
Arts, Bachelor of Laws and Doctor of Philosophy from the University of Sydney, as well as a Diploma
in Education from Sydney College of Advanced Education. He has been a teacher with the Law
Extension Committee since 1984. His most recent published books include (with C Stewart) Principles
of Australian Equity & Trusts (3rd ed, LexisNexis, 2016); (with C Stewart & I Vickovich), Principles of
Australian Equity & Trusts, Cases & Materials (3rd ed, LexisNexis, 2016); and (with J Gooley & I
Vickovich) Principles of Australian Contract Law (3rd ed, LexisNexis, 2014).
Prof Cameron Stewart, BEc, LLB(Hons), GradDipJur, GradDipLegal Prac, PhD
Cameron Stewart is Professor at Sydney Law School and has lectured in property and equity for many
years. He has published widely on matters of health law, guardianship and human tissue regulation.
His most recent published books include (with P Radan) Principles of Australian Equity & Trusts (3rd
ed, LexisNexis, 2016) and (with P Radan & I Vickovich), Principles of Australian Equity & Trusts,
Cases & Materials (3rd ed, LexisNexis, 2016).
ASSESSMENT
To be eligible to sit for the Board’s examinations, all students must complete the LEC teaching and
learning program, the first step of which is to ensure that you have registered online with the LEC in
each subject for which you have enrolled with the Board. This gives you access to the full range of
learning resources offered by the LEC.
To register with the LEC, go to www.sydney.edu.au/lec and click on the WEBCAMPUS link and follow
the instructions. Detailed guides to the Webcampus are contained in the material distributed by the
LEC, in the Course Information Handbook, and on the Webcampus.
2
Eligibility to Sit for Examinations
In accordance with the Legal Profession Admission Rules, the LEC must be satisfied with a student’s
performance in a subject in order for the student to be eligible to sit for the examination, conducted by
the Legal Profession Admission Board (LPAB). Assignments are used to assess eligibility.
Students are expected to achieve at least a pass mark of 50% in assignments to be eligible to sit for
examinations. However, a category of “deemed eligible” has been introduced to offer students whose
assignment mark is between 40-49% an opportunity to sit for the examination. In these circumstances
students are often advised not to sit. A mark below 40% means a student is not eligible to sit for the
examination.
Assignments as part of the Board’s Examinations
Assignment results contribute 20% to the final mark in each subject.
The Law Extension Committee (LEC) administers the setting and marking of assignments. The LEC
engages the LPAB’s Examiners to assess or supervise the assessment of assignments.
Submission
Assignments must be received by 11:59pm on the due date unless an extension has been granted.
Extensions must be requested by email prior to the due date. Specific supporting evidence must be
provided. Assignments that are more than ten days late will not be accepted. Late assignments attract
a penalty of one mark out of 20, or 5% of the total marks available, per day.
Assessment
Assignments are assessed according to the “Assignment Grading and Assessment Criteria” outlined
in the Guide to the Presentation and Submission of Assignments. Prior to the examination,
assignments will be returned to students and results posted on students’ individual results pages of
the LEC Webcampus. Students are responsible for checking their results screen and ascertaining their
eligibility to sit for the examination.
Review
Where a student’s overall mark after the examination is between 40-49%, the student’s assignment in
that subject will be included in the Revising Examiner’s review. The final examination mark is
determined in accordance with this review. Assignment marks will not otherwise be reviewed.
SEPTEMBER 2016 EXAMINATION
Candidates will be expected to have a detailed knowledge of the prescribed topics:
The History and Nature of Equity; The Relationship between Law and Equity; Assignments of Property
in Equity; Fiduciary Obligations; Estoppel in Equity; Confidential Information; Introduction to Trusts;
The Creation of Express Trusts; Variation and Termination of Trusts; Charitable Trusts; Resulting
Trusts; Constructive Trusts; The Duties of Trustees; The Powers of a Trustee; The Rights of Trustees;
Beneficiaries; and Equitable Remedies & Defences.
Candidates will be expected to have made a study of the prescribed materials in relation to those
topics, and to have analysed cases contained in the Law Extension Committee's course outline.
All enquiries concerning the September 2016 examination should be directed to the Legal Profession
Admission Board.
3
LECTURE PROGRAM
Lectures in Equity will be held on Thursdays from 6.00pm until 9.00pm. In the first half of the
semester, lectures will be held in Carslaw Lecture Theatre 373 (CLT 373). Lecture venues for the
second half of the semester have yet to be confirmed. For details as to the location of venues, refer to
page 52 of the Course Information Handbook for a map of the University of Sydney main campus.
Please note that this program is a general guide and may be varied according to necessity. Readings
are suggested to introduce you to the material to be covered in the lecture, to enhance your
understanding of the topic, and to encourage further reading. You should not rely on them alone.
WEEK
1
12 May
VENUE
CLT 373
TOPIC
KEY READING
The History and Nature of Equity
The Relationship between Law and
Equity
Principles of Australian Equity
and Trusts (‘PAET’), Chp 1, 2 &
3; Principles of Australian Equity
and Trusts: Cases and Materials
(‘CM’) Chp 1, 2 & 3
(Peter Radan)
2
19 May
CLT 373
Nature of Equitable Interests,
Dispositions of Property
(Peter Radan)
3
26 May
4
2 Jun
5
9 Jun
CLT 373
Fiduciary Obligations
CLT 373
Confidential Information
Introduction to Trusts
(Peter Radan)
PAET Chp 10; CM Chp 10
PAET Chps 9 & 20; CM 9 & 20
(Cameron Stewart)
CLT 373
The Creation of Express Trusts
Variation and Termination of Trusts
(Cameron Stewart)
6
16 Jun
PAET Chps 4, 5, 6 & 7 CM
Chps 4, 5, 6 & 7
CLT 373
Charitable Trusts
(Cameron Stewart)
PAET Chps 21 & 22; CM Chps
21 & 22
PAET Chps 23 & 24; CM Chps
23 & 24
Study Break: Saturday 18 June – Sunday 3 July 2016
7
7 Jul
8
14 Jul
9
21 Jul
TBA
Resulting Trusts
TBA
Constructive Trusts
(Cameron Stewart)
PAET Chps 35 & 36; CM Chps
35 & 36
TBA
Trustees
Beneficiaries
Tracing
PAET Chps 26, 27 & 37; PAET
Chps 26, 27 & 37
(Cameron Stewart)
PAET Chp 25; CM Chp 25
(Cameron Stewart)
10
28 Jul
TBA
Declarations
Specific Performance
Injunctions
PAET Chps 28, 29 & 30; CM
Chps 28, 29 & 30
(Peter Radan)
11
4 Aug
12
11 Aug
TBA
Freezing & Search Orders
Monetary Remedies in Equity
(Peter Radan)
TBA
Other Equitable Remedies
Equitable Defences
Equitable Estoppel
(Peter Radan)
13
18 Aug
TBA
Revision & Problem Solving
(Peter Radan)
PAET Chps 31 & 32; CM Chps
31 & 32
PAET Chps 38 & 39; CM 38 &
39
4
WEEKEND SCHOOLS 1 AND 2
There are two weekend schools primarily for external students. Lecture students may attend on the
understanding that weekend schools are primarily for the assistance of external students.
Please note that it may not be possible to cover the entire course at the weekend schools. These
programs are a general guide and may be varied according to need. Students are expected to have
read the relevant chapters of the text in advance of the lectures. You are advised to comply with this
reading to enhance your understanding of the topic and to encourage further reading.
The listed topics for lectures and times are set as a guide only. The time taken to cover individual
topics may vary.
Weekend School 1
TIME
MAJOR TOPICS
KEY READING
Friday 27 May 2016: 5.00pm – 9.00pm in New Law School Lecture Theatre 026 (New
LSLT 026)
5.10pm-6.20pm
The History and Nature of Equity
The Relationship between Law and Equity
6.30pm-7.35pm
Nature of Equitable Interests
Dispositions of Property
7.45pm-9.00pm
Fiduciary Obligations
Principles of Australian Equity and
Trusts (‘PAET’), Chp 1, 2 & 3;
Principles of Australian Equity and
Trusts: Cases and Materials
(‘CM’) Chp 1, 2 & 3
PAET Chps 4, 5, 6 & 7; CM Chps
4, 5, 6 & 7
PAET Chp 10; CM Chp 10
Saturday 28 May 2016: 8.00am – noon in Carslaw Lecture Theatre 373 (CLT 373)
8.10am-9.20am
9.30am-10.40am
10.45am-11.45am
Introduction to Trusts
The Creation of Express Trusts
PAET Chps 20 & 21; CM Chps 20
& 21
Variation and Termination of Trusts
PAET Chp 22; CM Chp 22
Charitable Trusts
PAET Chps 23 & 24; CM Chps 23
& 24
5
Weekend School 2
TIME
MAJOR TOPICS
KEY READING
Friday 22 July 2016: 5.00pm – 9.00pm in Carslaw Lecture Theatre 373 (CLT 373)
5.10pm-6.20pm
6.30pm-7.35pm
7.45pm-9.00pm
Specific Performance
Injunctions
PAET Chps 29 & 30; CM Chps 29
& 30
Monetary Remedies in Equity
PAET Chp 32; CM Chp 32
Equitable Defences
PAET Chp 39; CM Chp 39
Saturday 23 July 2016: 8.00am – noon in New Law School Lecture Theatre 024 (New
LSLT 024)
8.10am-9.20am
9.30am-10.40am
10.45am-11.45am
Resulting Trusts
Constructive Trusts
Trustees
Beneficiaries
Tracing
PAET Chp 25; CM Chp 25
PAET Chps 35 & 36; CM Chps 35
& 36
PAET Chps 26, 27 & 37; PAET
Chps 26, 27 & 37
6
TEXTS AND MATERIALS
For the period from 21 April to 30 May 2016, LexisNexis is offering our students a special discount and
free shipping on purchases made through the LexisNexis e-store at www.store.lexisnexis.com.au.
Students quoting the promo code LECW2016 will receive a 15% discount on all text titles (except for
those authored by John Carter). This discount is not limited to the prescribed or recommended texts for
our courses. Students should, however, still compare LexisNexis’s discounted price with that of other
outlets. The Co-op Bookshop, for example, offers a discount on texts sold to its members.
Course Materials

Guide to the Presentation and Submission of Assignments (available on the LEC Webcampus)

Other materials may be made available on the LEC Webcampus
Prescribed Texts

P. Radan and C. Stewart, Principles of Australian Equity and Trusts, 3nd ed, LexisNexis, 2016,
(together with up-dates available on the LEC Webcampus) (hereafter referred to as ‘PAET’)

P Radan, C Stewart and I Vickovich, Principles of Australian Equity and Trusts - Cases &
Materials, 3rd ed, LexisNexis, 2016 (hereafter referred to as ‘CM’)
Recommended Materials

G Dal Pont, Equity and Trusts in Australia and New Zealand, 6th ed, Thomson Reuters, 2015

G Dal Pont, Equity and Trusts: Commentary and Materials, 6th ed, Thomson Reuters, 2015

Dal Pont and Cockburn, Equity and Trusts: In Principle, 3rd ed, Thomson Reuters, 2014

M B Evans, Equity and Trusts, 3rd ed, LexisNexis, Sydney, 2012

H A J Ford & W A Lee, Principles of the Law of Trusts, 3rd ed, Thomson Reuters, 1995 (now
loose leaf)

J D Heydon & M J Leeming, Jacobs' Law of Trusts in Australia, 7th ed, LexisNexis, Sydney, 2006

J D Heydon, & P Loughlan, Cases and Materials on Equity and Trusts, 8th ed, LexisNexis,
Sydney, 2011

J. D. Heydon, M J Leeming & P G Turner, Meagher, Gummow & Lehane's Equity - Doctrines and
Remedies, 5th ed, LexisNexis, Sydney, 2015

D S K Ong, Ong on Equity, Federation Press, 2011

D S K Ong, Trusts Law in Australia, 4th ed, Federation Press, 2012

P W Young, C Croft & M L Smith, On Equity, Thomson Reuters, 2009
LEC Webcampus
Once you have registered online with the LEC, you will have full access to the Webcampus.
Regularly check the Course Materials section in the LEC Webcampus for additional materials, notes,
assignment questions and other relevant research sites.
7
COMPULSORY ASSIGNMENT
In Equity, there is only ONE ASSIGNMENT. This assignment is compulsory and must be
submitted by all students. Students must submit the assignment by the due date. A pass mark
is 50%. Refer to the Guide to the Presentation and Submission of Assignments for the
assignment grading and assessment criteria. Students who fail to satisfy the compulsory
requirements will be notified through the Results screen on the Webcampus before the
examination period of their ineligibility to sit the examination in this subject. The maximum
word limit for the assignment is 2000 words (inclusive of all footnotes but not bibliography).
The rules regarding the presentation of assignments and instructions on how to submit an assignment
are set out in the LEC Guide to the Presentation and Submission of Assignments which can be
accessed on the LEC Webcampus. Please read this guide carefully before completing and submitting
an assignment.
The completed assignment should be lodged through the LEC Webcampus, arriving by 11:59pm on
the following date:
Compulsory Assignment
Wednesday 20 July 2016
(Week 9)
ASSIGNMENT QUESTIONS
To obtain a copy of the Equity assignment for the Winter Session 2016, please follow the
instructions below:
1.
Register online with the LEC (see page 26 of the Course Information Handbook for detailed
instructions). Once you have registered, you will have full access to all the facilities on the
LEC Webcampus.
2.
Then go into the Webcampus, select the Course Materials section and click on the link to
the assignment questions for this subject.
8
PRESCRIBED TOPICS AND COURSE OUTLINE
Note: All items listed under ‘Key Readings’ are found in CM, unless otherwise
indicated
Lecture One
(12 May)
The History and Nature of Equity
The Relationship between Law and Equity
PAET, Chapters 1, 2 & 3; CM Chapters 1, 2 & 3
The History of Equity
Questions to guide your reading:


What were the key stages in the development of the law of equity?
How has the historical development of the law of equity affected its modern
application?
Key readings:







St Germain, ‘What is Equytie’
Avini, ‘The waqf and the trust’
Stebbings, ‘The trust in Victorian England’
Auchmuty, ‘Equity “Looking After” Women’
Dickens, ‘In Chancery’
Mason, ‘Variety and Stages of Fusion’
McPherson, ‘Judicial Reception of Equity’
The Nature of Equity
Questions to guide your reading:



What are the key underlying principles that guide equity’s intervention?
What is an ‘equitable maxim’?
What are the most significant equitable maxims?
Key cases and readings:





Parkinson, ‘The Conscience of Equity’
Jackson, ‘The Maxims of Equity Revisited’
King v The Chiltern Dog Rescue
Kirby, ‘Reasons for Equity to Grow’
Levenstein, ‘Aiding the Vigilant’
The Relationship between Law and Equity
Questions to guide your reading:



How did the Judicature Act change the administration of law and equity?
What is a ‘fusion fallacy’?
Should legal and equitable principles influence each other?
Key cases:



Harris v Digital Pulse Pty Ltd
Walsh v Lonsdale
Chan v Cresdon Pty Ltd
9
Lecture Two
(19 May)
Nature of Equitable Interests and Dispositions of Property
PAET, Chapters 4, 5, 6 & 7; CM Chapters 4, 5, 6 & 7
The Nature of Equitable Interests
Questions to guide your reading:


What are the indicia of a proprietary equitable interest?
What is the difference between an equitable interest, a personal equity and a mere
equity?
Key cases and readings:





Gross v Lewis Hillman Ltd
Commissioner of Stamp Duties (Qld) v Livingston
Horton v Jones
Latec Investments Ltd v Hotel Terrigal Pty Ltd
Hepburn, ‘The Benefits of Equitable Classification’
Assignments
This section of the course deals with the issues concerning the recognition in equity of
assignments of property or interests in property, both legal and equitable. In assessing
whether a court of equity will uphold or recognise any purported assignment it is essential to
correctly identify the components of the assignment, both as to form and content, in order to
identify the rules which determine the validity of that particular transaction. Satisfy yourself on
the following points:
(a)
(b)
(c)
(d)
Who is the assignor?
Who is the assignee?
What interest cannot be assigned?
What are the requirements for the assignment of property at law, especially the
assignment of a debt?
When do you need to consider whether an interest has been assigned in equity?
What are the rules for the assignment of property in equity?
What is meant by a disposition of property?
When, if at all, is a disposition of property required to be in writing?
(e)
(f)
(g)
(h)
Key cases and readings:











Austino Wentworthville Pty Ltd v Metroland Australia Ltd
Comptroller of Stamps (Victoria) v Howard-Smith
Norman v Federal Commissioner of Taxation
Shepherd v Commissioner of Taxation of the Commonwealth of Australia
Re Lind, Industrials Finance Syndicate Ltd v Lind
Corin v Patton
Grey v Inland Revenue Commissioners
Vandervell v Inland Revenue Commissioners
Oughtred v Inland Revenue Commissioners
Tettenborn, ‘Champerty and Assignments’
Equuscorp Pty Ltd v Haxton
10
Lecture Three
(26 May)
Fiduciary Obligations
PAET Chapter 10; CM Chapter 10
Fiduciary Obligations
Questions to guide your reading:




What is a fiduciary relationship?
When will a fiduciary relationship be imposed?
When will a fiduciary breach their duty?
What are the defences to a breach of fiduciary duty?
Key cases:







Hospital Products Ltd v United States Surgical Corporation
Boardman v Phipps
United Dominions Corporation Ltd v Brian Pty Ltd
Paramasivam v Flynn
Breen v Williams
Bodney v Westralia Airports Corporation Pty Ltd
Howard v Commissioner of Taxation
11
Lecture Four
(2 June)
Confidential Information & Introduction to Trusts
PAET Chapters 9 & 20; CM Chapters 9 & 20
Confidential Information
Questions to guide your reading:





What are the elements of the modern doctrine of breach of confidence?
What is ‘confidential information’?
When will there be an obligation of confidence?
What is the test for establishing a breach of the duty of confidence?
What are the possible defences for breach of the duty of confidence?
Key cases:









Prince Albert v Strange
Morison v Moat
Moorgate Tobacco Co Ltd v Philip Morris Ltd (No 2)
Coco v A N Clark (Engineers) Ltd
Australian Football League v Age Company Ltd
Del Casale v Artedomus (Aust) Pty Limited
Commonwealth v John Fairfax & Sons Ltd
Giller v Procopets
Australian Broadcasting Corporation v Lenah Game Meats Pty Limited
Introduction to Trusts
Questions to guide your reading
 What are the differences between trusts and contracts, fiduciary obligations, agency,
charges, conditional dispositions, debt and equitable obligations?
Key cases:






Gosper v Sawyer
Visnic v Sywak
Olma v Amendola
Countess of Bective v Federal Commissioner of Taxation
Barclays Bank Ltd v Quistclose Investments Ltd
Hammond v Hammond
12
Lecture Five
(9 June)
Creation of Express Trusts and Variation & Termination of Trusts
Charitable Trusts
PAET, Chapters 21 & 22; CM Chapters 21 & 22
Creation of Express Trusts
Questions to guide your reading:


What are the three certainties?
What are the requirements for proper constitution of the trust?
Key cases:




Byrnes v Kendle
White v Shortall
McPhail v Doulton
Pascoe v Boensch
Variation and Termination of Trusts
Questions to guide your reading




What are the conditions under which a variation of trust can occur?
What is the test for illegality?
How does public policy effect the creation of trusts?
What is the modern rule of perpetuities?
Key cases:





Stein v Sybmore Holdings
Nelson v Nelson
Ashton v Pratt
Ellaway v Lawson
Nemesis Australia Pty Ltd v Commissioner of Taxation
13
Lecture Six
(16 June)
Charitable Trusts
PAET, Chapters 23 & 24; CM Chapter 23 & 24
Charitable Trusts
Questions to guide your reading:






What is the definition of charity?
Define poverty
Define advance of education
Define advancement of religion
Define ‘beneficial to the community’
What are cy-pres schemes?
Key cases:







Commissioner for Special Purposes of the Income Tax v Pemsel
Aid/Watch Inc v Commissioner of Taxation
Ballarat Trustees Executors & Agency Co v Federal Commissioner of Taxation
Oppenheim v Tobacco Securities Co Ltd
Commissioner of Taxation v Word Investments
The Incorporated Council of Law Reporting of the State of Queensland v Federal
Commissioner of Taxation
Attorney-General (NSW) v Perpetual Trustee Co Ltd
14
Lecture Seven
(7 July)
Resulting Trusts
PAET, Chapter 25; CM Chapter 25
Resulting Trusts
Questions to guide your reading:




What are the two different kinds of resulting trusts?
When does the presumption of resulting trust arise?
When does the presumption of advancement arise?
What evidence can be brought to reverse the presumptions?
Key cases




Re Gillingham Bus Disaster Fund
Calverley v Green
Anderson v Anderson (No 2)
Trustees of the Property of Cummins (a bankrupt) v Cummins
15
Lecture Eight
(14 July)
Constructive Trusts
PAET, Chapters 35 & 36; CM Chapters 35 & 36
Constructive Trusts
Questions to guide your reading:



What are the key characteristics of a constructive trust?
When is a constructive trust institutional or remedial?
When are constructive trusts available?
Key cases:





Muschinski v Dodds
Black v S Freedman & Co
Grimaldi v Chameleon Mining NL (No 2)
Westpac Banking Corporation v The Bell Group (No 3)
Shepherd v Doolan
16
Lecture Nine
(21 July)
Trustees, Beneficiaries and Tracing
PAET, Chapters 26, 27 & 37; CM Chapters 26, 27 & 37
Trustees
Key cases:




Nolan v Collie
Byrnes v Kendle
McDonald v Ellis
Karger v Paul
Beneficiaries
Key cases:



Secretary, Department of Families, Housing, Community Services and Indigenous
Affairs v Elliott
CPT Custodian Pty Ltd v Commissioner of State Revenue
Kennon v Spry
Tracing
Key cases:


Foskett v McKeown
Re French Caledonia Travel
17
Lecture Ten
(28 July)
Declarations
Specific Performance
Injunctions
PAET Chapters 28, 29 (pp 754-774 only) & 30; CM Chapters 28, 29 &
30
Declarations
Questions to guide your reading:


On what basis can courts make declarations?
What is the equitable jurisdiction for declarations?
Key cases:




ACCC v MSY Technology Pty Ltd
Forster v Jododex Pty Ltd
Australian Conservation Foundation Inc v Commonwealth of Australia
Sankey v Whitlam
Specific performance
Questions to guide your reading:



When will specific performance be an appropriate remedy?
What jurisdictional factors will preclude an order for specific performance?
What discretionary factors may lead to an order for specific performance being
refused?
Key cases
 Beswick v Beswick
 Falcke v Grey
 C H Giles & Co Ltd v Morris
 Co-operative Insurance Society Ltd v Argyll Stores (Holdings) Ltd
 Mehmet v Benson
Injunctions
Questions to guide your reading:





What is the difference between prohibitive and mandatory injunctions?
When will an injunction be granted in equity’s auxiliary jurisdiction?
When will an injunction be granted in equity’s exclusive jurisdiction?
What is the difference between perpetual and interlocutory injunctions?
When will an interlocutory injunction be granted?
Key cases:







Australian Broadcasting Corp v Lenah Game Meats Pty Ltd
Redland Bricks Ltd v Morris
European Bank Ltd v Evans
Australian Broadcasting Corporation v O’Neill
Warner Bros Pictures Inc v Nelson
Gouriet v Union of Post Office Workers
The Attorney-General, on the Relation of Daniels, Steward and Wells v Huber,
Sandy, and Wichmann Investments Pty Ltd
18
Lecture Eleven
(4 August)
Freezing & Search Orders
Monetary Remedies in Equity
PAET Chapters 31 & 32; CM Chapters 31 & 32
Freezing & Search Orders
Questions to guide your reading:




What is the purpose of a freezing order?
What are the requirements for obtaining a freezing order?
What is the purpose of a search order?
What are the requirements for obtaining a search order?
Key cases:




Jackson v Sterling Industries Ltd
Cardile v LED Builders Pty Limited
Anton Piller KG v Manufacturing Process Limited
Long v Specifier Publications Pty Ltd
Monetary Orders in Equity
Questions to guide your reading:



What are the differences between equitable compensation and damages?
What is the purpose of equitable compensation?
When may a court award equitable damages?
Key cases:




Re Dawson (dec'd)
Wentworth v Woollahra Municipal Council
Johnson v Agnew
Break Fast Investments Pty Ltd v PCH Melbourne Pty Ltd
19
Lecture Twelve
(11 August)
Other Equitable Remedies
Equitable Defences
Equitable Estoppel
PAET Chapters 14, 38 & 39; CM Chapters 14, 38 & 39
Other Equitable Remedies
Key cases


Dart Industries Inc v Décor Corporation Pty Ltd
Langman v Handover
Equitable Defences
Key cases:





Black Uhlans Inc v New South Wales Crime Commission
Lamshed v Lamshed
Gerace v Auzhair Supplies Pty Ltd
AWA Ltd v Exicom Australia Pty Ltd
Commonwealth v Verwayen
Equitable Estoppel
Questions to guide your reading:



What is estoppel?
What are the elements of equitable estoppel?
What is the aim of relief for equitable estoppel?
Key cases:






Waltons Stores (Interstate) Ltd v Maher
Commonwealth v Verwayen
Thorner v Major
Giumelli v Giumelli
Delaforce v Simpson-Cook
Sidhu v Van Dyke
20
Lecture Thirteen
(18 Aug)
Revision and Problem Solving
Students should prepare notes on answers to the following questions prior to this class.
Question 1
In 2010 a trust, with Gina appointed as the trustee, was set up in relation to the following
assets:
(i)
(ii)
(iii)
(iv)
1,000 shares, each worth $10, in Gold Exploration Ltd (GEL), a publicly listed
company valued at 250 million dollars;
a vacant residential property in Collaroy;
a supermarket in Mosman; and
the sum of $1,000,000 which was invested in a high interest account with
Acme Banking Corporation Ltd (Acme).
The beneficiaries of the trust in equal shares to all the trust assets are Gina’s children, John
(now aged 28) and Bianca (now aged 14).
In early 2015 the Full Court of the Federal Court of Australia found Gina guilty of breaches of
s 18 of the Australian Consumer Law in relation to certain actions she had taken in managing
and operating the Mosman supermarket. Gina was ordered to pay, and did pay from her own
funds, $500,000 in damages to the plaintiff in that case. Gina was also ordered to pay, and
did pay from her own funds, the plaintiff’s legal costs of $50,000. In the course of the Full
Court’s joint judgment, the court observed that Gina’s actions that constituted the breach of s
18 were ‘outrageous and bordering on criminal fraud’. In relation to the damages and legal
costs that she has paid to the plaintiff, Gina claims that she is entitled to a lien against the
funds invested in Acme.
At all times since the trust was set up, the Collaroy property was vacant and Gina never
sought to have it leased to a tenant.
At no time since the trust was established has Gina provided John or Bianca with copies of
any trust documents or information about the s 18 litigation.
John, who is now very concerned about Gina’s conduct as trustee, seeks your advice
as to the following:
(i)
whether he can have legal title to 500 shares in GEL transferred to him;
(ii)
whether Gina is entitled to a lien over the funds deposited with Acme in relation
to the damages paid to the plaintiff and the legal costs incurred in the s 18
litigation;
(iii)
whether Gina has incurred any liability to the trust in relation to her
management of the Collaroy property;
(iv)
whether Gina is required to hand over to John copies of the trust deed,
financial accounts relating to the trust and all documents in her possession as
trustee relating to the s 18 litigation; and
(v)
whether the Supreme Court of New South Wales can, and would, remove Gina
as trustee and appoint a new trustee.
21
Question 2
Walter owns a small farm south of Sydney. Gustav owns an adjoining property of
approximately 2,000 hectares. Gustav, a bluegrass musician, is planning to hold a week-long
bluegrass music festival on his property on 14-15 November 2015. In early June 2015,
Gustav began advertising his bluegrass music festival. Prior to that point he had spent
$100,000 on preparations and facilities for the big event. At no stage did Gustav seek or
obtain local authority approval as he was required to do by the provisions of the Outdoor
Musical Events Act 2001 (NSW). If prosecuted by the local authority, Gustav’s failure to do
obtain the necessary local authority approval renders him liable to a penalty under the Act of
$20,000.
Two days ago, Walter, who, with his brother Eric, had been holidaying and visiting their
parents in a remote part of Argentina since April 2015, returned to Sydney. Walter
immediately became aware of Gustav’s plans. He is greatly concerned, particularly so as his
parents (both in their late eighties) will be visiting for a week at exactly the same time as
Gustav’s proposed festival is scheduled to be held. Walter has already paid $15,000 for their
return airfares from and to Argentina.
Eric, who lives in Gosford and hates bluegrass music, is also angered by Gustav’s actions.
In relation to the above facts:
(i)
If Walter commences proceedings to prevent the bluegrass festival from taking
place, what are the possible outcomes of such proceedings? (Note: In
answering this question you can assume: (i) the court would conduct a hearing
on the merits and hand down its decision on Walter’s application prior to 14
November 2015; and (ii) if the bluegrass festival is held, Gustav will be liable to
Walter in the tort of nuisance).
(ii)
Advise Eric on his prospects of being successful in any proceedings he may
take to prevent the bluegrass festival from taking place.
Question 3
Mark is the writer of the words and music to a famous pop song entitled ‘American Fly’
recorded in the 1970s by Ron McLean. Mark has been receiving royalties ever since from
Bizarro Productions Ltd, the music company that published all of McLean’s musical
recordings.
In March 2013, for valuable consideration, Mark assigned to Kelly ‘my royalties from
“American Fly” payable to me by Bizarro Productions Ltd for the 2014-2015 financial year’.
On 1 August 2015, Bizarro Productions Ltd deposited $30,000 into Mark’s bank account with
EastPac Banking Corporation in payment of his royalties for ‘American Fly’ for 2014-2015.
On the same day Mark advised Kelly about the receipt of the $30,000.
On 2 August 2015, Kelly telephoned Mark and directed him to hold his (Kelly’s) interest in the
$30,000 on trust for his nephew Jack.
On 1 September 2015, Mark executed his will, in which he appointed Frank as executor.
Clause 4 of Mark’s will stipulated as follows:
I give my bank account with Vanderlay Banking Corporation to my executor to hold
on trust for the scholarships for students undertaking post-graduate research in
American history with a preference to be given to the children of employees and
former employees of Kramerica Enterprises Ltd.
Clause 5 of Mark’s will stipulated as follows:
22
I give my house at 22 Clarke Street, Manly to Manuel De la Vega on condition that
he keep it as a home and provide board for his sisters Linda De La Vega and Maria
De La Vega.
Clause 6 of Mark’s will stipulated as follows:
I give the residue of my estate to Basil.
Frank seeks your advice as to the following:
(i)
who is entitled to the royalties received by Mark on 1 August 2015;
(ii)
the effect of Clause 4 of Mark’s will; and
(iii)
the effect of Clause 5 of Mark’s will.
Question 4
In the early 1990s Belinda’s husband was killed on active military service during the First Gulf
War. As a result, she was entitled, pursuant to the War Veterans Act 1919 (Cth) (the Act), to
a subsidised loan in relation to the purchase of a house or home unit. Section 45 of the Act
stipulated that such subsidised loans were only available to a former soldier’s widow if, at the
time of purchasing the house or home unit, the widow ‘owned no land or interest in land’
anywhere in Australia.
In 2001 Belinda and her niece Alicia decided to buy a Torrens title house in Warriewood for
the sum of $500,000. Belinda and Alicia contributed equally towards the purchase price.
However, the house was registered in Alicia’s name as sole registered proprietor. This was
done because Belinda intended to apply for a subsidised loan pursuant to the Act at a later
date to purchase another house. A few months after moving into the house Belinda and
Alicia decided that it would be a good idea to add a couple of rooms to the house. This was
done at a cost of $100,000 paid for by Alicia.
In 2005 Belinda purchased a house in Dee Why. To enable her to purchase this house she
successfully applied for a subsidised loan pursuant to the Act. In her application for the
subsidised loan, Belinda declared that she ‘did not own land or any interest in land in
Australia’.
In mid-2015, following a falling out between Belinda and Alicia, the property at Warriewood
was put up for sale. Last week, contracts for the sale of the property for $900,000 were
exchanged. Alicia has told her aunt that she (Alicia) is entitled to the whole of the sale
proceeds upon completion of the sale.
Belinda seeks your advice as to whether she (Belinda) has a claim to any of the
proceeds of sale of the Warriewood house.
Question 5
Mark was the owner of a Torrens title property at 15 Lister Street, Manly. The certificate of
title to the property was held in safe custody by Mark’s solicitor Bill. One month ago Mark
instructed Bill to prepare the necessary documentation to have the property transferred to
Teresa as a gift. A few days later Mark and Teresa went to Bill's office where they executed
the Memorandum of Transfer that had been prepared by Bill. Bill advised them that the
property had to be valued for stamp duty purposes and that, once a valuation had been done,
stamp duty on the transaction had to be paid. He further advised them that, after the payment
of stamp duty, the transfer, together with the certificate of title, would have to be lodged for
23
registration, whereupon Teresa would become the registered proprietor of the Manly property.
Mark then gave Bill a cheque to cover the stamp duty and other expenses involved in getting
the property registered into Teresa's name.
Two days ago Mark telephoned Bill to enquire how things were proceeding in relation to the
transfer of the Manly property to Teresa. Bill told him that stamp duty had been paid, that the
valuation had been done and that he was going to lodge the transfer for registration on the
next day. An hour after speaking to Bill, Mark was killed in a motor vehicle accident. Because
of Mark’s death Bill did not lodge the transfer for registration.
In his will, Mark appointed his sister Gillian as his executrix, trustee, and residuary
beneficiary. The will was executed on 29 November 2005. Clause 2 of Mark's will stipulated
as follows: ‘I give my property at 15 Lister Street, Manly to Joe on trust’.
Clause 3 of Mark’s will stipulated as follows: ’I give my bank account with Eastpac Banking
Corporation to Gillian on trust for the education of the descendants of three my nephews,
Moe, Larry and Shemp’.
After reading the terms of the will, Gillian approached Joe in relation to Clause 2. Joe, a close
friend of Mark's, told Gillian that in early 2006: (i) Mark had told Joe that he (Mark) had made
a will which stipulated that the property at Manly was to go to Joe, but that he (Mark) wanted
Joe to hold that property on trust for somebody else; (ii) Mark gave Joe a sealed envelope in
which he (Mark) said was a note containing the name of the person for whom Joe was to hold
the property on trust; (iii) Mark instructed Joe that the envelope was not to be opened until he
(Mark) had died; and (iv) Joe had said to Mark that he (Joe) would carry out Mark's
instructions.
Joe then produced the envelope that he had received from Mark and opened it in Gillian's
presence. Inside was a written note, signed by Mark, which, after referring to the provisions of
clause 2 of his will, stated that Joe was to hold the Manly property on trust for Regina
Falange. At the date of his death, Mark’s bank account with Eastpac Banking Corporation had
a balance of $4,003,221.
Gillian seeks your advice as to:
(a) who is entitled to the Manly property; and
(b) the effect of Clause 3 of Mark's will.
24
Question 6
Jennifer is the registered proprietor of Torrens title land known as Leica Chalet. She was also
the registered shareholder of 2,000 shares in Acme Constructions Ltd. Jennifer wanted to
make a gift of property to her niece Evelyn. To do this she made oral declarations to the effect
that she held Leica Chalet and the shares on trust for Evelyn.
A few days after Jennifer’s declarations, Evelyn, in a letter to Maralyn, wrote: ‘I give to you
any interest I have in Leica Chalet’. In a telephone conversation with Jennifer on the same
day Evelyn said: ‘I want Maralyn to have my shares in Acme Constructions Ltd. Transfer them
to her as soon as possible’.
Evelyn died the next day, leaving a will in which Filipe was named as sole beneficiary of her
entire estate.
Jennifer seeks your advice as to who is entitled, in law and equity, to Leica Chalet and
the shares.
Question 7
Jack (born in 1950) and Jill (born in 1955) met in 1974 and entered into a de facto
relationship in 1975. In 1976 they had a child named Zac. In 1987 they purchased a house in
Richmond for $150,000. The purchase price was paid by Jack, the money coming to Jack as
an inheritance from the estate of his late uncle. At the time of purchase Jack decided to have
the property registered in his, Jill’s and Zac’s names as tenants in common and in equal
shares.
In 1994, when Zac reached his majority age Jack opened a bank account with the Western
Sydney Bank Ltd in the joint names of Jack and Zac. All the money for the account was
supplied by Jack. When opening the account Jack told Zac that he (Jack) alone would be
making all the deposits into the account and would withdraw from the account whenever he
wanted to. However, he also said that if anything should ever happen to him (ie Jack) the
money then in the account would belong to Zac.
Two weeks ago Jack and Jill died instantly in a car accident. In his will Jack left his entire
estate to Lucy, his daughter that he had fathered in 1972. In her will Jill left her entire estate
to Zac. At the time of their deaths the Richmond property was worth $800,000, and the bank
account at Western Sydney Bank Ltd had a balance of $5,000.
Lucy seeks your advice as to whether she has any entitlements in the Richmond
property and the bank account, and, if not, who is entitled and to what extent.
Note: Students should ignore the provisions of any relevant statute and answer the
question on the basis of the principles of equity.
25
Question 8
Characterise the following provisions contained in Lionel’s will:
a. I give the whole of my personal estate to James, whom I also appoint as my executor and
trustee, subject to James paying the sum of $5,000 to my son Alvin within two years of
the date of my death.
(Note: Assume that Lionel died three years ago and no payment has been made to
Alvin).
b. I give my house in Cooma to Petra absolutely, with the hope that she will allow my mother
to live there until she dies.
c. I give $2,000,000 to my trustees upon trust for the purchase or provision of an area of land
in rural New South Wales to be used as a park or reservation or sanctuary for the
purpose of the preservation and conservation of native Australian flora and fauna.
Question 9
In 2005 George Van Nostrum opened a bank account in the name of 'Nancy van Nostrum –
George van Nostrum, Trustee’. At the time of opening the account, George never had any
intention to hold the money in the account on trust for Nancy. The account was operated by
George solely for his benefit and purposes.
Last week Nancy died. In her will Nancy left the whole of her estate to Benito. The bank
account at the date of her death had a credit balance of $25,000.
Benito seeks your advice as to whether he is entitled to any interest in the bank
account.
Question 10
Jack recently entered into two separate contracts with Kevin, a well-known painter. In the first
contract Kevin agreed to sell to Jack, a guitar once used by the legendary rock guitarist, Eric
Clapton. The contract price was $2,000, although the commercial value of the guitar was
$15,000.
In the second contract Kevin agreed to paint Fred’s wooden garden furniture in return for Jack
paying Kevin $1500 for the paint work to be done. Fred was Jack’s next-door neighbour.
A few days ago Jack and Kevin had a serious argument following which Kevin told Jack that
he was not going ahead with either of the contracts.
Jack seeks your advice as to whether he can insist on Kevin complying with his
contractual obligations.