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Key decisions

  • Bosanac v Commissioner of Taxation [2022] HCA 34
  • TL v The King [2022] HCA 35

Trusts

Resulting trust

In Bosanac v Commissioner of Taxation [2022] HCA 34 (12 October 2022) the High Court was required to consider two ‘duelling’ presumptions: the presumption of a resulting trust and the presumption of advancement. The shoot-out may not have been as entertaining as a Western, but it was illuminating in understanding the nature and operation of both presumptions (and presumptions more generally).

The stage for this gun fight was set by the Commissioner of Taxation (‘Commissioner’). The Commissioner was a creditor of Mr Bosanac. Mr Bosanac had, at one time, been married to Ms Bosanac. Ms Bosanac was the sole registered proprietor of a residential property located in Dalkeith, Perth (‘Dalkeith Property’). During their marriage, and for a period of their separation, Mr and Ms Bosanac resided in the Dalkeith Property. The deposit for the purchase of the Dalkeith Property was paid from a joint loan account held by Mr and Ms Bosanac. The balance of the purchase price was paid through two separate loans procured by the couple and secured over the Dalkeith Property and three other properties. Of these three properties, two were owned by Mr Bosanac and one was owned by Ms Bosanac.

The Commissioner commenced proceedings in the Federal Court of Australia against Mr Bosanac and Ms Bosanac seeking a declaration that Ms Bosanac held half of the Dalkeith Property on trust for Mr Bosanac. The Commissioner relied on the presumption that a person who advances money for the purchase of a property, held in the name of another person, intends to have beneficial interest in that property (the presumption of a resulting trust). Militating against the presumption of a resulting trust is the presumption that a husband who advances money to a wife intended that beneficial interest would pass with legal interest (‘the presumption of advancement’). But the Commissioner argued the presumption of advancement was no longer part of Australian law in relation to the matrimonial home following the High Court’s decision in Trustees of the Property of Cummins v Cummins (2006) 227 CLR 278 (‘Cummins’).

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