DISTRICT COURT OF QUEENSLAND
CITATION:
Sheldrick v Sheldrick & Anor [2021] QDC 118
PARTIES:
NICKI LEE SHELDRICK
(applicant)
v
DANIEL GARY SHELDRICK
(first respondent)
and
GAVIN CHARLS MORTON AND LEON LEE AS STATUORY TRUSTEES(second respondent)
FILE NO:
1362/2020
DIVISION:
Civil
PROCEEDING:
Application
ORIGINATING COURT:
District Court, Brisbane
DELIVERED ON:
22 June 2021
DELIVERED AT:
District Court, Brisbane
HEARING DATE:
10 June 2021
JUDGE:
Reid DCJ
ORDER:
1. Order of Her Honour Judge Kefford of 19 February 2021 restraining the sale of the property be discharged.
2. Order that the costs incurred by the trustees and of their solicitors in obtaining vacant possession of the property from the applicant, and their costs of and incidental to this action, to be agreed or failing agreement to be assessed, be paid from the proceeds of the sale of the property otherwise payable to Ms Sheldrick.
CATCHWORDS:
REAL PROPERTY – STATUTORY TRUSTEES – APPLICATION – SALE OF INTEREST IN PROPERTY – where the applicant and first respondent each have a 50% interest in the property – where the applicant wishes to purchase the first respondent’s 50% interest in the property – where the first respondent wishes the property to be sold and the proceeds divided - where statutory trustees have been appointed to facilitate the sale of the property – where the statutory trustees have been restrained from selling the property until further order by the Court - where the applicant applies to cease the public auction of the property and execute a contract of sale of the first respondent’s 50% interest in the property to her for the sum of $145,000 – whether the proposed contract adequately reflects the reasonable costs incurred by the trustees in facilitating the sale of the property and other expenses directly attributable to the applicant’s conduct – whether the contract is consistent with the trustees’ obligation to obtain the best price reasonably obtainable for the property – whether the order of the Court restraining the trustees from selling the property until further order should be set aside
REAL PROPERTY – STATUTORY TRUSTEES – where the applicant resided at the property – where the applicant was ordered by the Court to vacate the property – where the applicant left personal items on the property after vacating it – where the trustees’ notified the applicant’s solicitors of the applicant’s personal items left at the property – whether the trustees’ acted appropriately in relation to the applicant’s personal property
LEGISLATION:
Property Law Act 1974 (Qld)
CASES:
Dickson v Roy (1991) 5 VPR 11, 655
Buttle v Saunders [1950] All ER 193
COUNSEL: Applicant in person
First respondent in person
L. Copley for the second respondent
SOLICITORS: Rose Litigation as lawyers for the second respondent
Introduction
This is an application by Ms Nicki Sheldrick for an order that statutory trustees for the sale of a property at Regents Park, in which Ms Sheldrick is a beneficial owner to the extent of 50%, “cease the public auction” of the property and execute a contract of sale of her brother’s 50% interest in the property to her for the sum of $145,000.
The application is opposed by the trustees, and by the applicant’s brother, Daniel Sheldrick. The trustee’s themselves seek an order discharging an order of Judge Kefford restraining the trustees from selling the property, other than to the applicant.
Background
Ms Sheldrick and her brother inherited the house from their grandmother who died on 1 June 2016. Under her Will, both received a half interest in the house. Ms Sheldrick has a strong emotional connection to the house and wishes to purchase her brother’s 50% interest. Her brother wishes the property to be sold, and the proceeds divided.
On 17 June 2020, I ordered that Leon Lee and Gavin Morton be appointed pursuant to s 38 of the Property Law Act as trustees for the sale of the property. I also ordered;
“1. …
2. That the trustees be entitled to sell the property by such method as they deem appropriate in the circumstances including but not limited to sale by auction or by private treaty.
3. That (Ms Sheldrick) be entitled to make offers on the property for consideration by the trustees, without the need for the trustees to sell the property by auction or to require (her) to pay a deposit on account of such purchase.
4. That in the event of sale by private treaty the trustees shall determine the appropriate marketing of the property including listing price from time to time, the appointment of the agents for the sale of the property and the terms and conditions for such appointment or appointments.
5. In the event of sale by auction:
(a) …
(b)…
(c)should (Ms Sheldrick) be the successful bidder at auction the trustees are authorised to sell to that party without a requirement that the purchasing party pay a deposit at the time of execution of the contract
(d)…
…
9. That (Ms Sheldrick) will vacate the property within one month from the date of this order and provide the keys to the property to the trustees in preparation for sale, unless the statutory trustees agree otherwise.
..
11. That (Ms Sheldrick) be at liberty to purchase the property upon terms that she shall not be required to pay any deposit and that she may set-off against the purchase price the value of her share in the property.
12. That upon settlement of the sale the sale price should be paid in the following manner:
(a)first, in payment of all necessary selling costs including agents’ commissions, legal costs, marketing and advertising costs and all other necessary costs incurred in the sale;
(b)second, in discharge of any liabilities secured against the property by registered mortgages;
(c)third, in payment of the trustees’ costs and expenses properly incurred in effecting the sale and when the sale is settled;
(d)fourth, the net proceeds of sale of the property, after payment of the amounts referred to in (a) to (c) above, are to be held by the trustee on trust pending further order of the Court or agreement of the parties.
13. That the trustees are entitled to charge all reasonable costs and disbursements properly incurred by the trustees in the performance of their obligations pursuant to these orders and that their fees and expenses are a first charge on trust monies.
…
15. Liberty to (Mr Sheldrick), (Ms Sheldrick) or the trustees to relist the matter for further argument, upon any of those parties giving three days’ notice in writing to the others.”
Prior to the making of my order Ms Sheldrick and Mr Sheldrick had taken the property to auction but it was I gather passed in at a figure of $365,000. I am not in a position to determine why that offer was not accepted, and it is not necessary to do so. It is however for all concerned tragic it was not then sold or that Ms Sheldrick did not then buy her brother’s interest for half of that sum. Their joint equity in the property has now been significantly diminished.
Ms Sheldrick, despite my order, did not vacate the property as ordered, or as requested by the statutory trustees subsequently. She was ultimately evicted on 1 November 2020.
Prior to that the trustees had sought to ascertain Ms Sheldrick’s interest in buying the property.
On 17 June 2020, Mr Lee tried to call Ms Sheldrick but was unsuccessful in doing so. On that same day he emailed her advising her of his attempts to call her and asked her to “please call me urgently”.
On the following day Mr Lee again emailed Ms Sheldrick noting the requirement of my order that she vacate the property within one month.
On 25 June, Mr Lee wrote to Ms Sheldrick (see p 14 of exhibits to the affidavit of Mr Lee filed on 26 February 2021, court document 30) suggesting that if she wish to offer to purchase the property she submit any offer urgently and he requires that any offer include:
(a)The price;
(b)Any conditions;
(c)When you intend to settle;
(d)Evidence of sufficient funds or finance approval.
The letter noted that unless otherwise agreed Ms Sheldrick was to vacate the property by 17 July.
It seems Ms Sheldrick was obtaining assistance of some form from a woman, Sue Farmakis, whose name periodically appears in correspondence. On 17 June Ms Sheldrick wrote to Mr Lee giving him permission to speak to Ms Farmakis about matters involving the property.
On 25 June, Ms Farmakis emailed Mr Lee, Ms Sheldrick and her brother’s then solicitors, Bennet and Philp, purporting to make an offer to purchase, based on a notional price of $280,000 (see p 28 of exhibits to document 30). The offer asserted Mr Shelkrick be responsible for legal costs to be taken out of his share.
Why that would be appropriate is not apparent to me, or, importantly, made clear in Ms Farmakis’ email.
Understandably Mr Lee on 26 June emailed Ms Sheldrick and Ms Farmakis (see p.25/26 of exhibits to Document 30) and said he said he could not “work out…what (Ms Sheldrick) is actually offering”. A reply from Ms Farmakis of 29 June, did not, I find clarify that issue and Mr Lee on 30 June again wrote to her, and Ms Sheldrick as follows:
“You did not answer my two earlier emails. I need to know:
1. Price
2. Any conditions
3. Settlement date
I also request evidence that Nicki has sufficient funds and/or finance approval. The deadline to provide this information is 8 July 2020.
If this is not provided Nicki will need to vacate the property so it can be sold.”
On 1 July, Mr Lee again requested Ms Sheldrick to advise about these matters by 8 July and said that if it was not provided, she needed to vacate by 17 July (see p. 17 of exhibits to Document 30). Due to there being no response, Mr Lee wrote to Ms Sheldrick and Ms Farmakis on 10 July noting that no “suitable offer” had been made and requiring Ms Sheldrick to vacate by 17 July (see p.21/22 of exhibits to Document 30).
Subsequently Ms Sheldrick sought to obtain a stay of the order I had made concerning selling the property by auction and sought to appeal the order she vacate the premises.
On 24 September 2020 the Court of Appeal ordered that the notice of appeal be struck out and ordered Ms Sheldrick to pay Mr Sheldrick’s costs of the application and of the notice of appeal to be assessed on the indemnity basis. The Court of Appeal further ordered:
“that the statutory trustees, Gavin Charles Morton and Leon Lee, have leave to deduct the costs so assessed from the proceeds of the sale of the land otherwise payable by Nicki Lee Sheldrick and pay the same to the solicitors acting for Daniel Gary Sheldrick.”
Ms Sheldrick continued to make attempts to purchase the property. On 16 July she emailed Mr Sheldrick’s solicitor with an offer – though it was an offer which left matters to be agreed upon, such as adjustment of costs.
Subsequently, on 23 July a valuation of $290,000.00 was obtained by Ms Sheldrick from a valuer, Acumartis (see Annexure C to Document 18).
In July the trustee engaged Rose Lawyers to act for them. On 30 July a solicitor with that firm, Mr McEniery, wrote to Ms Sheldrick inviting any offers to purchase. Importantly, the letter said that the trustees required her to provide the following information:
“1.The proposed purchase price (noting that our clients will be required to sell for market value).
2.Any conditions related to the proposed sale contract (such as whether the sale contract is subject to finance).
3.The settlement date.
4.The proposed finance/funding for the purchase.”
The letter indicated that, otherwise, the property would be sold and “you will be required to vacate by a ‘deadline’ of 24 August” and indicated that if she did not the trustees would apply to the court for an order of possession.
Ms Sheldrick, on 13 August, emailed Mr Lee directly. She referred to email correspondence she had with Mr Sheldrick’s solicitor and (Mr Young of Bennett & Philp) on 2 June 20202. She said a valuation had been obtained and asserted she then “AGAIN offered to buy my brother’s half”. She said she repeated that offer on 16 July. She said neither offer had been responded to. In that correspondence of 13 August, she asked the trustee to advise “what the position is with my offers”.
On 17 August Mr McEniery emailed Ms Sheldrick requesting information about her offer, indicating to her the requirements of any such offer set out in [21] hereof.
On the following day Ms Sheldrick forwarded to Mr Lee the valuation from Acumentis.
Mr McEniery emailed Ms Sheldrick on 25 August (see p 49 of exhibits to Document 30), noting her failure to respond to his requests of 30 July (and I note, repeated on 17 August) and advised her he had been instructed to obtain an order for possession of the property.
On 17 September Ms Sheldrick wrote to Mr McEniery in these terms:
“I…confirm that the paperwork for my loan to buy Gary Daniel Sheldrick’s 50 per cent of Lot 643 Qld, will be handed to yourself, NO LATER than another five business days this Thursday.
I am organising means to vacate, for any reason my loan might not be approved.
PLEASE GIVE ME INE [sic] MORE WEEK.
I’M BEGGING YOU ALL.”
On the same day Mr McEniery advised the statutory trustees would permit her to stay in the property for a further 10 days.
Ms Sheldrick, at that stage, instructed a solicitor, Mr John Stevenson of Ace Solicitors to act for her. On 1 October an email was sent to Mr McEniery. On its face it appears to be from Mr Stevenson, advising that Ace Solicitors now act for Ms Sheldrick and that “finance is imminent and expected to be formally approved within the next 10 business days”. The email address however, for that email, shows it was sent directly by Ms Sheldrick (see p 54 of exhibits to Document 30).
No doubt with concerns about that unusual circumstance, Mr McEniery, on 1 October emailed Mr Stevenson seeking confirmation he acted for Ms Sheldrick. Ms Sheldrick however continued to correspond with Mr McEniery (see, for example, email of 6 October at 1:35pm at p 60/61 of exhibits to Document 30, requesting a mediation of the matter). Mr McEniery responded to Ms Sheldrick indicating that a mediation was not possible as his client had been ordered by the court to sell the property.
Subsequently, it seems the trustee appointed Allmain to effect the sale of the property and perhaps also to secure vacant possession of the property from Ms Sheldrick. On 24 October, Ms Sheldrick emailed Paul Wagner of Allmain asking that he direct all correspondence to her solicitor, the elusive Mr Stevenson. I say ‘elusive’ because, so far as I can tell, he had not by that stage, communicated with the trustees or Mr McEniery, despite what I have earlier said.
Ms Sheldrick advised Mr Wagner, “we are lodging a stay of proceedings as finance has been arranged to buy my brother’s half share”. On 27 October, Mr Stevenson rang Rose Lawyers and spoke to a legal secretary who noted he wanted to discuss the matter and confirmed he was acting for Ms Sheldrick. This appears to be the first contact that Mr Stevenson made and was almost four weeks after the initial email form Ms Sheldrick of 1 October advising that he was acting for Ms Sheldrick.
Subsequently, it seems Ms Sheldrick obtained approval for finance to purchase the property. Mr Stevenson sent to Ms Sheldrick the letter of offer to her in relation to such finance from Oak Capital and, on that same day, 30 October, Ms Sheldrick sent that to Mr McEniery (see p 67 of exhibits to Document 30). That document headed “Indicative Offer” was for a loan of $203,897.00 for a term of 12 months and at an interest rate of 9.95 per cent. It was signed by Ms Sheldrick. The offer was to a company, Nicki-Lee Holdings Pty Ltd. The offer of finance may however have allowed her to make a meaningful offer for the property.
On 4 November Mr Stevenson emailed Mr McEniery advising of his instructions to make an offer on behalf of Ms Sheldrick to purchase her brother’s share of the property for a purchase price of $145,000.000 (see p 81 of exhibits to Document 30).
At this stage, I digress from my chronological consideration of the correspondence to say something of that offer and, indeed, of submissions made before me concerning purported offers by Ms Sheldrick to purchase the property.
Whatever Ms Sheldrick’s personal belief, the trustees were lawfully appointed by order of the court. That order was not the subject of any appeal seeking to set aside their appointment.
Since their appointment, the trustees have incurred costs in managing and maintaining the property. Furthermore, they have incurred legal costs associated with Ms Sheldrick’s refusal to vacate the property dispute the very clear order that I made that she do so.
Additionally, she appealed from an aspect of the order and the Court of Appeal ordered, on 24 September 2020, that the trustees costs of the application and notice of appeal be assessed on an indemnity basis and deducted from the proceeds of sale otherwise payable to Ms Sheldrick, and be paid to Mr Sheldrick’s solicitors.
That Ms Sheldrick was liable for a significant amount of costs over and above the purchase price of half of the property in the event she was to purchase it appears to have been ignored by her. Nowhere in the offer of 4 November, to which I have referred, was this very obvious and financially significant matter addressed.
Her failure to have ever made an offer recognising her liability for such matters, including her half share generally for the trustees costs and her particular sole liability for other costs, is fundamental to a realisation that at no time did she ever make an offer that she could reasonably have expected would have been accepted by the trustees, or could have been contemplated by her brother as being a reasonable offer. She simply failed to recognise that if she wanted to make an offer acceptable to the trustees and to her brother she needed to make an offer which recognised her obligations which arose from the appointment of the trustees and her conduct of the matter thereafter.
On 11 November the trustees instructed Lewis Property Valuation to obtain a valuation of the property. Prior valuations from Acumentis on 23 July 2020 in the sum of $290,000, and from Opteon of 22 November 2019 in the sum of $285,000 were provided to Lewis Property. Subsequently, Lewis Valuations provided a valuation on 16 November 2020 in the sum of $280,000.
I note that Ms Sheldrick was evicted from the property on 1 November. Because she had not taken appropriate steps to prepare for that, personal property of hers was left behind on the property.
On 17 November Mr McEniery provided an Abandoned Goods Notice to Mr Stevenson of Ace Law. He was advised in an accompanying letter that Ms Sheldrick could take over the rental charges to the storage unit for the goods if she wished. She at no time did so. On 24 November 2020 Mr McEniery wrote to the solicitors for both Mr Sheldrick and Ms Sheldrick (see p148 of the exhibits document 30) in these terms;
“First, the trustees are content to sell the Property for market value in accordance with the Valuation.
If either of your clients wishes to purchase the Property for the amount specified in the Valuation, please let us know that and provide us with evidence of your client’s capacity to pay the purchase price.
Second, pursuant to the terms of the Order, the Trustees are entitled to charge all reasonable costs and expenses incurred by the Trustees and the Trustees’ fees and expenses are a first charge on the Trust monies.
If the Property is sold to one of your clients, only 50 percent of the purchase price will be paid to the Trustees. On that basis the Trustees consider it necessary that the potential incoming purchaser also contribute towards the Trustees’ fees and disbursements from their share of the Property.” (by emphasis)
In the circumstances, the Trustees propose the following:
1. “The Trustees calculate their fees and disbursements incurred during their appointment from 17 June 2020 to the conclusion of a sale to an incoming purchaser. (this will include a conveyancing solicitor’s fees and disbursements).
2. The purchase price for the Property be increased by a sum equivlevant to 50 percent of the Trustees fees and disbursements to account for the incoming purchaser’s 50 percent share of the Trustees fees and disbursements.
3. The remaining 50 percent of the Trustees’ fess and disbursements be paid out of the proceeds of sale received by the Trustees.
4. Further, if Ms Sheldrick wishes to purchase the Property, the Trustees consider that Ms Sheldrick should alone be responsible for the Trustees’ fees and expenses in relation to applying to court for a warrant possession and the costs associated with enforcing that warrant including all costs associated with the eviction.
In addition, if Ms Sheldrick does not agree to be solely responsible for those costs, we will likely receive instructions to apply to the court and (sic) order pursuant to s 42 of the Property Law Act that Ms Sheldrick be solely responsible for those costs.
The Trustees further consider that such an offer is appropriate as paragraph 9 of the Order stated that Ms Sheldrick was required to vacate the Property within one month of the Order which did not occur. (by emphasis)
We request that you provide us with your client’s response to the above proposal.
Alternatively, if your clients do not wish to purchase the Property from the Trustees, please notify us of that and the Trustees will proceed to market and sell the Property.
Given that the Trustees have been appointed for a substantial period of time already, our clients request your clients’ response by 5pm, 27 November 2020.” (by emphasis)
In my view, this letter clearly sets out the reasonable requirements of the trustee in respect of any offer, consistent with the observations I earlier made.
Neither party responded to that letter. On 30 November Mr McEniery emailed both parties’ solicitors advising;
“We are instructed that (the trustees) will now prepare the property for sale, commence marketing the property, and then take it to auction.”
Agents were appointed to sell it.
On 9 December Ms Sheldrick emailed Mr McEniery directly, asking for an interim invoice of the trustees’ costs to date. These were forwarded on 11 December by trustees solicitors as follows, noting specifically that they did not include the legal costs of Rose Lawyers:
Trustees’ Costs
Amount ($)
Insurance
3,211.12
Allmain expenses
11,474.35
Total (est.)
11,500.00
Allmain’s expenses, of course, related solely to the need to evict Ms Sheldrick.
Furthermore, the letter from Mr McEniery advised that Ms Sheldrick needed to take responsibility for the storage shed or move her belongings “by the deadline of 28 days from 17 November 2020. If the belongings are not collected by the deadline our client will arrange for them to be destroyed.”
17 November was, of course, the day the Abandoned Goods Notice had been served on her solicitor.
Sandra Ardetean, a solicitor with Ace Law, on 18 December emailed Mr McEniery enclosing what was said to be an REIQ contract. It was unsigned. The email asked Mr McEniery to “advise whether you require any special conditions relating to payment of trustees fees to be inserted.” This of course was despite the email of 11 December to which I have already referred, which made that requirement obvious.
The contract listed Mr Sheldrick and Ms Sheldrick, rather than the trustees, as the seller. The buyer was said to be Nicki Lee Holdings Pty Ltd. Ace Solicitors were said to be the solicitors for both buyer and seller. The purchase price was $140,000. It should or would have been obvious the offer was grossly inadequate.
Mr McEniery responded on 21 December noting;
1. That Ms Sheldrick had not responded by the deadline of 30 November
2. A sales agent had now been appointed
3. The offered amount made no allowance “on account of the trustees’ costs in obtaining possession of the property as stated by our clients on 17 November 2020
4. As Ms Sheldrick had “failed to collect her belongings or take over the storage shed our clients will arrange for the belongings to be disposed of.”
Nothing then appears to have happened between the parties for some time. The auction of the property was scheduled for the 20 February 2021. On 22 January 2021, an offer to purchase the property was received from a Mr Jacob Ferge in the sum of $345,000 (see [22] of the affidavit of Leon Lee, Document 30, and pp 194/5 of exhibits thereto). Because of the expressed view of the agent, L J Hooker, that there was significant interest in the property, and their opinion provided to the trustees that a better offer would be likely to be made at the auction, that offer was not accepted. Indeed, L J Hooker indicated that Mr Ferge himself had said “he was prepared to pay more”.
The agents indicated to the trustees that they believed that the property would sell “at the upper end of our appraisal of between $340,000.00 to $360,000.00” at the auction of 20 February.
On 18 February 2021, two days before the auction, Ms Sheldrick filed an application to restrain the auction and on 19 February, the day before the auction, Kefford DCJ restrained the trustees from selling the property other than to Ms Sheldrick until further order. The matter was again mentioned before Her Honour on 1 March and was on that day set down for trial on 10 and 11 June. It was then heard by me.
In the meantime, on 1 March 2021 Ms Farmakis made an oral offer to purchase on behalf of Ms Sheldrick. Rose Lawyers, in an email to Ms Sheldrick of 2 March sought confirmation that the terms of that offer were as follows:
“(a)the purchase price is $145,000.00 calculated as a half-share of $290,000.00 (being the price for the entirety of the property)
(b)the purchaser is Nicki-Lee Holdings Pty Ltd ACN 644644315
(c)the offer is subject to finance within 21 days from the date of contract to satisfy that condition
(d)settlement is take place within 14 days of finance being approved.”
The letter asked Ms Sheldrick to confirm the offer which had been made orally so that the trustees could consult with Mr Sheldrick’s solicitors.
There was however no response to that email, and consequently Mr McEniery, again emailed Ms Sheldrick on 5 March, again enclosing the letter of 2 March, and also an inventory of all items taken from the property on 1 November when she was evicted. Mr McEniery noted that the inventory had been provided to her solicitors on 17 November 2020.
On 9 March Mr McEniery noted, in an email to Ms Sheldrick, that those goods had in fact been disposed of as she had failed to collect them or take over the rental for the storage unit.
Ms Sheldrick, in a number of emails of 9 March disputed the trustees’ right to have done so but the emails merely asserted the trustees were not entitled to have done so. She did not dispute that Mr Stevenson had been served on 17 November as the trustees’ asserted. (see pp 7-9 of the exhibits to Document 35 being the affidavit of Mr Lee of 17 May 2021).
On 10 March Ms Sheldrick again wrote to Mr McEniery and purported to attach a copy of a contract in an amount of $145,000.00, said to be subject to finance and indicated that the purchaser could be either her or Nicki-Lee Holdings Pty Ltd.
Interestingly, she wrote: “On my end, nothing has changed. The offer has always been the same.”
I again refer to my earlier comments concerning the lack of preparedness of Ms Sheldrick to acknowledge the effect of the cost orders made, including in the Court of Appeal, and of the fact and extent of trustees’ and their solicitors’ costs and expenses, on the sum she would be require to pay. Her offer simply ignores such matters.
Mr McEniery susequently noted the email did not include the attached contract. This was eventually provided on 16 March.
Rose Lawyers responded on the same day (see p 13 of the exhibits to Document 35). They drew attention to the trustees’ view that the property was worth in excess of $280,000.00, noted that the offer did not include an amount on account of the trustees’ costs and disbursements and asked if she agreed to pay such amounts and, if so, what amounts, on account of such costs and disbursements.
On 14 April Rose Lawyers advised Ms Sheldrick that the trustees had consulted with Mr Sheldrick, since he was no longer represented by Bennett and Philp. They advised Ms Sheldrick that Mr Sheldrick had said that he did not agree to a sale for $280,000.00 having regard to the then current value of the property.
Mr McEniery advised that the trustees believed they must try to achieve the best price they could by selling it at an auction. He also noted Ms Sheldrick had made no offer with respect to the trustees’ costs and disbursements, which would of course, also need to reflect the order of the Court of Appeal of 24 September 2020.
On 23 April Mr McEniery itemised invoices received by the trustees in relation to their trusteeship which amounted to some $31,579.60. In addition, he advised there would be costs and expenses of the abandoned auction of February 2021, unpaid rates (said to amount to $8,473.36) and legal costs and the trustees’ own charges.
Consideration
I have set out the detail of correspondence between the parties because consideration of it illustrates the failure of the applicant, Ms Sheldrick, to have addressed the issue of her obligation to the trustees and to her brother with respect to costs and expenses including those that had in fact been ordered to be paid by her, or which were directly attributable to her failure to have vacated the property as I ordered. At no time has she ever made an offer to reflect the reality of her obligation to pay such costs and expenses.
Ms Sheldrick’s submission that the trustees have simply refused to negotiate the sale of the property to her, as countenanced by the order I made on 17 June, is without foundation. The reason no contract was entered into was because of her own failure to make offers, greater than 50 per cent of what she believed, with some justification, to be the value of the property, to reflect her obligation with respect of fees, costs and expenses. The trustees’ fees are by reason of [12(c)] of my order of 17 June to be paid from the proceeds of sale and the applicant’s conduct has resulted in them incurring additional fees. The Court of Appeal order required the applicant to pay the costs of the first respondent.
The trustees, of course, have the ordinary duties and obligations of trustees, including an obligation of equal treatment of the beneficiaries. They are obliged to give the beneficiary relevant information as to fees and expenses and to wait and consider any response (see Dixon v Lloyd [1991] VLR 11, 655).
They are also obliged to obtain the best price for the property that is reasonably obtainable (see Buttle & Ors v Saunders & Anor [1952] 2 All ER 193).
The application seeks an order that the trustees execute a contract, tendered by Ms Sheldrick, in the sum of $285,000.00.
That contract is not an appropriate one, for the reasons I have explained and because I find the current value of the property is closer to $350,000. In this regard, I accept the evidence of Mr Lee and of the real estate agent, Ms Molijan. Their evidence is generally consistent with the offer of $345,000.000 made in February 2021 to which I earlier referred.
To so find is not inconsistent with earlier valuations in the range of $280,000.000 to $290,000.00. It seems that the property market has risen recently.
I generally accept the written submissions of counsel for the trustees in relation to the setting aside of Judge Kefford’s order.
I also find that the trustees acted appropriately in relation to Ms Sheldrick’s property. It was destroyed only after she failed to respond to their numerous notices sent to her solicitors. I find her solicitors were informed as I have earlier set out. I do not know if they told Ms Sheldrick of those notifications or not. She asserts they did not. If they did tell her, then it was her decision not to respond to the notice. If they did not she may have a cause of action against them, but neither the trustees, nor their solicitors, are responsible for her solicitors’ possible failure to do so.
Orders
1. It is, in the circumstance, appropriate to discharge the order of Her Honour Judge Kefford of 19 February 2021 restraining the sale of the property.
2. I will also order that the costs incurred by the trustees and of their solicitors in obtaining vacant possession of the property from the applicant, and their costs of and incidental to this action, to be agreed or failing agreement to be assessed, be paid from the proceeds of the sale of the property otherwise payable to Ms Sheldrick.