In February 1988, Richard Sckaff purchased a residential property in Dulwich Hill, a Sydney suburb, for $110,000. His brother George claimed that the property was held on trust for him. In December 2023, a single judge of the Supreme Court of NSW found in favour of George. This decision was reversed by The NSW Court of Appeal in a decision delivered on 19 August 2024 (Sckaff v Sckaff [2024] NSWCA 207).
George put two arguments to establish his right to the property. The first was that his parents paid the purchase price for George and decided to put the property in Richard’s name because he was the more reliable of the sons. The second argument was that Richard was estopped from denying that the property was his because Richard never claimed he was the owner, George carried out extensive renovation work without complaint from Richard, lived in the property rent free for 25 years with his family, with his wife moving into the property in 2001.
Both arguments were accepted by the trial judge but rejected by the Court of Appeal. The Court of Appeal made it clear that it was open to them to draw inferences from the facts that were contrary to those of the trial judge.
It was fundamental to George’s trust argument that the property was paid for by his parents Farad and Souad. He supported his case by his evidence that he resided there and made improvements.
Richard’s case was that he purchased the property from his own resources with the support of a loan from the CBA.
It was difficult for the trial judge to determine how the purchase of the property was financed because there was little documentary evidence available and the accounts of Richard and George were very different
George’s version was that his parents helped him with the purchase by giving him $60,000 that Farad had received as a redundancy payment. George gave evidence of a conversation with his parents to the effect that they wanted to help him buy a house just as they had helped Richard buy a house in Campsie (another Sydney suburb) and given $30,000 to their sister at her wedding.
On examination of the evidence before the trial judge, the Court of Appeal rejected each of these findings. The evidence was that it was unlikely that Farad received the redundancy payment as claimed. In addition, the evidence was that Mary, the sister, did not receive $30,000 at her wedding or at any other time, and that Richard paid for the Campsie property himself.
The trial judge accepted that the loan repayments were paid out of Richard’s account but did not accept that he could have made these payments himself. His Honour did his own calculation after the trial concluded to help reach this conclusion. The Court of Appeal found that this was an appealable error.
Having found that Richard paid the purchase price for the property that concluded that the argument that the parents purchased the property for George.
The remaining argument to be decided on the appeal was whether by staying silent as to ownership over many years Richard accepted that the property was held in his name for George. The Court of Appeal found that in fact Richard asserted that he was the true owner of the property on each of the four occasions that the issue arose between the two brothers. The Court of Appeal also accepted the evidence of Richard that he allowed a number of renovations to occur because of brotherly affection, just as he had never claimed rent.
Richard agreed that it was proper for him to compensate George for the increased value of the property because of the renovations he had carried out. Richard was ordered to pay $250,000.
The appeal as to who was the true owner of the property was decided in Richard’s favour.