Administrator Seek Damages for Unlawful Occupation of Land

Maher v Kuperholz [2022] VSC 224 (9 May 2022)

The plaintiffs filed a claim against the administrator and executors for debts and a declaration that estate holds lands on trust for plaintiffs.  However, it was argued that the plaintiff was unlawfully occupying land belonging to the estates.  The Court, in resolving this dispute, assessed whether or not the executors and administrators are entitled to award of damages of mesne profits. 

Facts:

David and Anthony Maher are brothers who have lived on and farmed land near Barnong in Central Victoria all their lives.  Significant portions of this land were acquired over many years by their father, Thomas P. Maher (TP Maher), who died in 1975.  The land which David and Anthony continue to occupy and farm includes land owned by the estate of TP Maher, as well as a property known as ‘Thompsons’ from where they conduct their farming operations.  ‘Thompsons’ is owned by the estate of their mother, Maureen Brown, who died on 18 June 2014.

The administrator of the TP Maher estate, Nathan Kuperholz (the Administrator), and the executors of the estate of Maureen Brown, Christine Burden and Damien Maher (David and Anthony’s siblings), contend that David and Anthony are unlawfully occupying Thompsons and the land owned by the TP Maher estate.  They seek damages against David and Anthony in the nature of mesne profits in respect of their unlawful occupation of the lands, and orders for vacant possession.  The Maher family originally lived on the TP Maher estate in a home known as ‘Fine View’.   After TP Maher died, Maureen Brown purchased ‘the Maureen Brown estate land’).

For many years from about 6 December 1967, Thomas, Gerard, David and Anthony engaged in a farming partnership known as the ‘Maher Bros partnership’ (Maher Bros).  Maher Bros owned land which was either contiguous with the TP Maher estate land, or otherwise in close proximity to the TP Maher estate land and the Maureen Brown estate land (the Maher Bros land).  In addition to the holdings of Maher Bros, David and Anthony also separately own other land.  That land too is either contiguous with the TP Maher estate land, or the Maher Bros land.

The last will of TP Maher was executed on 19 August 1968 (the TP Maher will).  It appointed Maureen Brown, Thomas and Gerard as executors of his estate.  Probate was granted to them on 2 February 1976.  On 21 July 2017, the Court made orders removing the surviving executors of the TP Maher estate, Thomas and Gerard, and appointing the Administrator in their stead.  Maureen Brown’s last will was executed on 22 September 2009.  It appointed Christine, Damien and Anthony to be the executors and trustees of her estate.  Probate was granted to Christine and Damien (the Executors) on 26 November 2015.

Issue:

Whether or not the executors and administrators are entitled to award of damages of mesne profits.

Applicable law:

Kuru v New South Wales [2008] HCA 26; (2008) 236 CLR 1 - provides that ‘an authority to enter land may be revoked and ... if the authority is revoked, the entrant no longer has authority to remain on the land but must leave as soon as is reasonably practicable’.

Harrison v Harrison[2011] VSC 459 - Kaye J (as he then was) undertook an extensive analysis of evidence in order to conclude that the plaintiffs in that proceeding had suffered detriment by failing to challenge their father’s will in reliance on representations made by their defendant brother. 

Lollis v Loulatzis [2007] VSC 547 - provides that damages awarded for trespass to land are sometimes described as “mesne” profits. 

Sydney Local Health District v Macquarie International Health Clinic Pty Ltd (2020) 105 NSWLR 325 - the Court of Appeal of New South Wales recently examined in detail the history and applicable principles relating to damages for trespass including mesne profits. 

Analysis:

The usual measure of damages by way of mesne profits is the market rent for the relevant property for the period of the trespass.  There are no special circumstances which might warrant a departure from this yardstick in the circumstances of this case.  David McKenzie, whose expert evidence was relied upon by the Administrator and the Executors, gave evidence about the market rental for the TP Maher estate land and Thompsons. Mr McKenzie’s expert reports and his oral evidence were based on a comprehensive review of all relevant information, including comparable rental information, and involved the application of an appropriate valuation methodology.

His valuations were at or below the lower end of the observed market range of rentals for properties which were broadly comparable to the TP Maher estate land and Thompsons.  This reflected the existence of a number of adverse features of the relevant parcels of land, and more generally, the adoption of an appropriately cautious approach to valuation.  As to the Executors’ claim in relation to Thompsons on the basis of proprietary estoppel, there was a paucity of evidence adduced by David and Anthony in support of it.  Even if this evidence is sufficient to establish the making of a promise by Maureen Brown as referred to in [58(a)], there is no evidence that David and Anthony acted in reliance upon it by not challenging the TP Maher will and continuing to work on the land. 

While David and Anthony provided evidence that Maureen Brown told them in about 2002 that they could have perpetual use of the TP Maher estate lands in return for paying the rates on those lands and that they have in fact paid the rates on the land, it does not follow that they thereby accrued a legal entitlement to continue occupying the TP Maher estate lands after Maureen Brown’s death.  The fact that David and Anthony’s occupation of the lands only became unlawful on and from 1 December 2019 is a consequence of the fact that it was not until 11 October 2019 that the Administrator revoked their right to occupy those lands, which right the Administrator had impliedly granted to David and Anthony after his appointment by permitting them to continue in occupation of the lands as they had done in the years since Maureen Brown’s death.

Conclusion:

The Court accepted Mr McKenzie’s evidence that the market rental for the property for the years 2017, 2018, 2019, 2020 and 2021 is a total of $112,652.  The Executors in their representative capacity are also entitled to damages based on a market rental for Thompsons of $63.80 per day for the period from 1 January 2022 until vacant possession of Thompsons is given.  The Administrator and the Executors are entitled to orders that David and Anthony give vacant possession of the TP Maher lands and Thompsons respectively.  A stay of 30 days on the operation of orders that David and Anthony give vacant possession is granted.