As discussed in our previous alert, Ms Bosanac, the wife of Mr Bosanac at the time of the purchase of property in Dalkeith, WA as their matrimonial home, was given leave to appeal to the High Court a finding of the Full Federal Court that both she and Mr Bosanac intended that Mr Bosanac would have a 50% beneficial interest in that property.
The Full Federal Court in so finding ruled that any “presumption” of advancement in her favour was rebutted by the particular facts of the case. In particular, the fact that Mr Bosanac assumed a substantial liability in the acquisition of their matrimonial home was significant and considered to be inconsistent with an intention by him not to retain a beneficial interest in the property.
In submissions made to the High Court in response to the appeal by Ms Bosanac, the Commissioner sought to advance a new core argument that the presumption of advancement ought to be abolished entirely, on the basis that it has no acceptable rationale, and is anomalous, anachronistic and discriminatory. It was the Commissioner's position that absent the operation of the presumption of advancement, it would follow that there was no basis upon which the presumption of a resulting trust (in favour of Mr Bosanac) is or could be refuted.
Presumption of advancement remains, although weak
In a judgment handed down on 12 October 2022, the High Court rejected this core argument, noting that the presumptions of resulting trust and advancement are interrelated and entrenched “land-marks” in the law of property.
Further, the High Court said that in the absence of knowledge as to what effect the abolition of the presumptions would have on existing entitlements, the better course would be to leave any reform of this branch of the law to the legislature.
Accordingly, the presumptions of advancement and of resulting trust remain as part of the law today in Australia.
Notably, however, the Court (in the judgment of Kiefel CJ and Gleeson J) observed the presumption of advancement is especially weak today. Kiefel CJ and Gleeson J also noted previous judicial observations that both presumptions are but a mere circumstance of evidence, that may be readily rebutted by comparatively slight evidence, as it was here.
Proper inference to be drawn from the facts was that there was no presumption of advancement to Ms Bosanac, but no resulting trust in Mr Bosanac’s favour either
There was a history of Ms and Mr Bosanac holding their substantial real and other property in their own names. Consistently with this, the Court found it was evidently the desire of Ms Bosanac to purchase the Dalkeith property and have it registered in her name alone. She was the moving party.
These facts alone were considered sufficient by Kiefel CJ and Gleeson J to rebut any presumption that her interest in the property was attributable to the relationship of husband and wife and his intention to benefit her. Thus, the “presumption” of advancement did not apply.
Further, in contrast to the views of the Full Federal Court, the inference to be drawn from Mr Bosanac being a party to the borrowings that financed the acquisition of the Dalkeith property was that Mr Bosanac intended to facilitate his wife’s purchase of the property, which was to be held in her name, consistent with the history of their dealings. Accordingly, no resulting trust arose.
In this regard, Kiefel CJ and Gleeson J observed that it is the concern of the courts to determine what was intended when property was purchased or transferred. It may once have been the case that evidence capable of rebutting the presumptions of advancement and resulting trust was not available. That is unlikely to be so today, especially in the context of dealings as between spouses where the relationship has been of sufficient length to permit a court to observe how the spouses have dealt with property as between themselves and managed their affairs.
Extension of presumption of advancement?
Finally, the High Court also observed that if the presumption of advancement was to remain (not be abolished by Parliament), then despite its weakened state in the law today, there is the question as to whether it should now apply to transfers of property not just from wife to husband, given the position that many wives now have respecting income and property, but also as between spouses more generally given the recognition by statute of de facto relationships in proceedings concerning property and same-sex marriage.
The Court noted that as important as these matters are, they were not in issue on this appeal and were not the subject of any argument.