Booth v Booth [1935] HCA 15; (1935) 53 CLR 1 (1 April 1935)

HIGH COURT OF AUSTRALIA

Booth Plaintiff, Appellant; and Booth Defendant, Respondent.

H C of A

On appeal from the Central Court of the Territory of New Guinea.

1 April 1935

Rich, Starke, and Dixon JJ.

Teece K.C. (with him W. J. V. Windeyer), for the appellant.

Abrahams K.C. (with him Stephen), for the respondent.

Teece K.C., in reply.

The following written judgments were delivered:—

1935, April 1

Rich and Dixon JJ.

By the order under appeal the Supreme Court of the Territory of New Guinea determined against a husband three claims made by him in a suit against his wife.

The first claim related to a dredging and sluicing lease in the district of Morobe, called "Cliffside," which, in 1924, had been taken up in her name. The second related to a neighbouring dredging and sluicing lease, called "Clifftop," which, in 1927, had been taken up in the name of a nominee from whom she subsequently took a transfer. The third claim was made in respect of a sum of £3,000 which she had received from her husband in October 1927. The husband claimed that none of these pieces of property was his wife's, but that, either they were his exclusively, or else he and she owned them in common, as partners, or simply as co-owners.

The parties were married in 1919 and came to New Guinea in the following year. In 1924 they set out together for the Morobe Goldfields, and, after an arduous journey, established themselves on the Bulolo River. Each obtained a miner's right. At the end of that year the husband, Booth, on the advice of a man who was already conducting some successful mining operations there and who had arranged that Mrs. Booth should take charge of his place during a short absence, went prospecting two or three miles down the Bulolo River where he found encouraging conditions near a small creek flowing into the river. He named the creek after his wife and pegged out two claims extending about 100 chains up the river and a chain and a half on each side from midstream. He wrote out a notice of application for a lease in his wife's name and placed it in a tin which he nailed to one of the pegs. Next day he made some alteration in his pegs so that the claim was for one large area. But the notice of application remained as it was. On his return to his wife, he made out an application for a dredging and sluicing lease in her name and she signed it. About £50 was required for fees and rent payable upon the application and this sum she borrowed. Booth gave evidence to the effect that he gave his wife to understand that she would hold the lease for him as his agent; but his Honor, Chief Judge Wanliss, who heard the suit, did not accept this testimony and found that Booth intended the lease to be his wife's property.

The lease, which was granted, was worked with very great success. Booth did the actual work of management and direction. All necessary supplies were obtained by him upon his credit. For more than a year the greater part of the gold won was sent to the suppliers, who placed the proceeds to the credit of his account with them. Then the gold was sent to a bank, which also placed the proceeds to his account.

The second lease, that of Clifftop, was pegged out two years and a half after the first, namely, 11th July 1927. Booth and his wife had gone to Australia earlier in the year in connection with a proposed sale of Cliffside, which in the end did not go through, and he had just returned, leaving his wife behind. A dummy seems to have been thought necessary or desirable for a second lease and Booth requested his wife to obtain powers of attorney from persons in Australia. One of Mrs. Booth's friends put her signature to a form of power of attorney in favour of Booth, who, on receipt of the document, pegged out a claim and made an application in the lady's name. She had little comprehension at the time of what she was asked to do and less recollection afterwards. The areas pegged out adjoined the Cliffside lease on either side and the application made the somewhat naive statement that the area was essential for the successful working of the Cliffside lease. Early in 1932, Mrs. Booth decided to leave her husband. She took the precaution to obtain from her friend whose name had been used for the application for Clifftop a transfer of that lease. Thus both Cliffside and Clifftop stand in Mrs. Booth's name.

The sum of £3,000, which forms the third subject of claim, was sent by Booth from New Guinea to his wife in Brisbane on 5th October 1927. After lodging the application for the Clifftop lease, Booth had again visited Australia, and, before leaving, he had entered into some negotiations for the purchase of two aeroplanes with a view to establishing an air service in New Guinea. These negotiations were incomplete when he returned to New Guinea and he authorized his wife to conclude the bargain. Believing that she had done so, as he says, he sent the money to her. However the negotiations went off and she did not repay the £3,000 to her husband. Instead, she spent £500, invested £1,000 in Commonwealth bonds and £1,500 on fixed deposit in her own name. Contradictory accounts of what took place in reference to the money were given by the parties. The learned Judge was decided in rejecting the husband's version and accepted that of Mrs. Booth, but with feelings of less certainty. According to her, she wrote to her husband telling him that the transaction had gone off and describing what she had done with the money, and she said that he made no complaint or remonstrance. About eighteen months afterwards, when they were in London, he asked her to transfer some money there, because he had not enough. She, accordingly, caused £1,500 to be remitted to her in three sums, which she paid into his account. At least £1,200, if not all, of this sum came from that which she had invested.

This narrative states sufficiently the facts surrounding the acquisition by Mrs. Booth of the pieces of property the beneficial ownership of which is now in dispute. But these facts occurred as incidents in a long course of business and adventure in which the parties were associated. The manner in which they were so associated is probably the consideration of most weight in deciding the question whether they, or, at any rate Booth, did not intend that his wife should take the beneficial ownership. Chief Judge Wanliss has reviewed at length the greater part of the material events which befell them, and it is unnecessary to recount those facts. It is sufficient to state shortly what are the chief additional matters relied upon by the appellant in support of his contentions. All the expenses of operating claims standing in the name of either of them was borne by accounts in Booth's name. In dealing with the gold produced from Cliffside and that produced from other claims taken up in Booth's name no discrimination was practised. Until the middle of 1926, current accounts were opened by the parties in a bank at Rabaul: all the gold was consigned to the commercial house which provided the stores and other supplies. When the bank accounts had been opened, most of the gold was despatched through the bank on Booth's account, but two parcels, each worth something over £600, were sent through the bank on his wife's account, and these parcels came, not from Cliffside, but from the claim taken up in Booth's name. When, in April 1927, a deposit of £5,000 was paid by the proposing purchasers of Cliffside, a deposit ultimately forfeited, the amount was divided between Booth and his wife. The transaction was carried out in her name and the cheque for the deposit was paid into her bank account, but she gave him a cheque for £2,500 and invested the remaining £2,500 on fixed deposit in her own name. According to his evidence, which on this point was accepted, he proposed the division and she at once assented. The assets, in respect of which the deposit was paid, consisted of the lease of Cliffside, which was in Mrs. Booth's name, the plant and stores which had been acquired by him in his own name and the benefit of the native labour which had been recruited by him. They were all included in an agreement in which she was the vendor and he was not a party. In relation to native labour on Cliffside, it seems almost to be an accident whether official returns were made in his name or hers. Then in their financial relations before the break between them, no effort was made to distinguish funds either in reference to their source or in their application.

The contention of the appellant is that, from the whole case, it appears that neither Mrs. Booth nor her husband intended or considered her to be the beneficial owner of Cliffside and that all that remains is to decide between the alternatives of trusteeship for him exclusively and partnership or some other co-ownership.

But the true explanation of all the conduct upon which the appellant relies appears to be that the parties placed complete confidence in one another and each desired no better title to the enjoyment of the benefits arising from property vested in the other than the matrimonial relationship gave. When Mrs. Booth applied in her own name for the lease of Cliffside, all the probabilities are that her husband had no thought of her occupying the position of trustee, still less of nominee. Although he did the work of prospecting and of pegging out the claim, it is not a case of a husband acquiring property in his wife's name. The property, the lease of Cliffside, was acquired by an application made by Mrs. Booth herself and by a payment which she made out of money lent to her. Booth's motives for encouraging this course cannot, perhaps, be determined with certainty upon the conflicting testimony which the parties gave. But, with the absolute confidence in her which he then apparently possessed, he probably disregarded the possibility of any question of property arising between them and thought that she ought, as against the outside world, to be established as owner of one of the claims taken up. She had not the least objection to an affectionate husband's management of the claim and to his assumption of control over the revenue produced. But all this affords no ground for the inference that she intended to constitute herself a trustee or that he considered himself the beneficial owner. Partnership is a relation springing from agreement express or implied. There is no ground for imputing to the parties any tacit agreement to operate the claims or any of them as partners. Some expressions in the book she published were relied upon, but, whether she used them herself, or they were the product of the mind whose aid in literary composition she acknowledges, the allusions they contain to the firm of Booth & Booth are but figurative. There is no trace in the evidence of any intention to share in any fixed proportion either profits or capital. All that they did is distinctly referable to the relationship of husband and wife. The beneficial ownership of the lease of Cliffside rested where the legal ownership was placed.

The lease of Clifftop presents, perhaps, another question, because the nominee who gave the power of attorney, although the repository of the legal title, clearly meant to assert no claim to the beneficial ownership and probably gave little or no thought at the time she gave the power to the question whether the beneficial ownership was to be in Mrs. Booth or her husband. But she was Mrs. Booth's friend and lent her name at her request. The purpose of taking up the Clifftop lease was to extend the boundaries within which the working of Cliffside was confined, and the application acknowledges that it was ancillary to Cliffside, which, as Booth knew, belonged to his wife. It is incumbent on the plaintiff to establish affirmatively that a trust in his favour existed, and, in face of these considerations, it is necessarily very difficult for him to do so. In other circumstances, the fact that it was he who pegged out the lease and framed the application and paid the fees might be enough. But the fees came out of funds which included money arising from Cliffside, and the statement in the application itself suggests that he regarded the properties as a unit. The circumstances are at least consistent with, if they do not establish, the inference that he meant his wife to enlarge her property in Cliffside by the acquisition of Clifftop.

Booth's claim to the £3,000 transmitted to his wife fails for other reasons. All but £500 was invested in a form which for some time preserved its identity. If he had chosen to assert a claim to these investments at the time, he might have established a beneficial or equitable title to them. But he clearly acquiesced in his wife's assumption of control over the fund and indicated, with as much certainty as if he had made a formal gift to her, that he was content that she should retain it as her own. It would not be strange for a husband to take such a course in ordinary circumstances, but when to the relationship of husband and wife is added the fact that the money was gained from a venture in which she took so active a part and from mining claims of which an important one was taken up in her name, it appears most natural for him to acquiesce in her retention of the money. The £500 had been spent in travelling expenses and the like, the money for which, otherwise, he would have found. This expenditure he ratified. His possible equitable title to the investments representing the balance he abandoned, and thus gave her full beneficial ownership. (See Crichton v. Crichton[1].)

For these reasons, assuming that Mrs. Booth has a legal capacity independent of her husband such as arises from the Married Women's Property Act, she is entitled to retain the property which Booth claims in this appeal. But he contends that under the law of New Guinea she has not such a capacity. This contention depends upon the manner in which English law has been introduced into the Mandated Territory. The Laws Repeal and Adopting Ordinance 1921-1933, made under the New Guinea Act 1920-1932, excludes German law (sec. 4). By sec. 11 certain Commonwealth statutes are brought into operation in New Guinea. By sec. 13, it applies to the Territory certain statutes of Queensland which do not include the Married Women's Property Act. By sec. 14, the Acts, statutes and laws of England that are in force in Queensland and are applicable to New Guinea are adopted as laws of the Territory. But this section does not refer to English statutes in force in Queensland only in the sense that the Parliament of that State has enacted legislation based upon or transcribed from them. The English Married Women's Property Acts are not in force in Queensland except in that sense. Sec. 15 of the Laws Repeal and Adopting Ordinance applies to New Guinea certain Papuan ordinances, but none of these affects the matter. Sec. 16 then provides that the principles and rules of common law and equity that were in force in England on 9th May 1921 shall be in force in the Territory so far as applicable and so far as not repugnant to the provisions of any Act, ordinance, or the like having the force of law there. It may, of course, be said that the English Married Women's Property Act forms no part of the principles and rules of common law and equity. On the other hand, it displaced principles and rules of common law which, accordingly, were not "in force" in England in May 1921. But, except for local ordinances, the whole of the law of New Guinea appears to be derived from or through the provisions quoted from the Laws Repeal and Adopting Ordinance. Accordingly, if the suggested interpretations were placed upon that ordinance, there would, on the subject of married women's property, be a legal vacuum. There would be no law at all upon the subject. The German law is excluded: the common law would not be introduced, because no longer "in force" in England, and the legislation is omitted from the statutes specifically applied. If this were the case, it might be right to regard a married woman's status as involving in New Guinea no restrictions on her contractual and proprietary capacity. As no law affecting that capacity would be introduced, she would not differ from a feme sole in that respect. But it is impossible to suppose that the ordinance really meant to leave outside the scope of the law the whole topic of married women's property. It is so evidently the intention of the ordinance to introduce, subject to local ordinances and to the specified enactments of Queensland and Papua, the whole content of English law applicable to the circumstances of New Guinea that a very wide meaning should be given to sec. 16 in spite of the difficulties which its language presents. Probably the principles and rules of common law must be taken subject to and together with the statutory modifications in their application which had been made in England before 9th May 1921. But, in any case, it is impossible to give effect to the contention that New Guinea received from the common law the doctrine of the unity of personality of husband and wife so that, except when in equity a separate estate would exist, separate ownership by the wife would be beyond her capacity.

For these reasons the appeal should be dismissed with costs.

Starke J.

Appeal from the Central Court of the Territory of New Guinea. Charles Booth sued his wife, Doris Regina Booth, in that Court, and claimed (1) the beneficial ownership of a dredging or sluicing lease known as "Cliffside," in the Morobe district of the Territory of New Guinea, taken up and registered in the name of his wife; (2) the beneficial ownership of a dredging or sluicing lease known as "Clifftop," in the same district and adjoining "Cliffside," which was taken up in the name of Ruth Evelyn Mateer and transferred to and registered in the name of Doris Regina Booth; (3) £3,000 paid by Booth to his wife.

The action was tried before the Chief Judge of the Territory, who gave judgment on these claims in favour of the wife. It is a singularly unfortunate dispute, for the properties were taken up during arduous and in fact daring adventures by the husband and wife in search of gold on the Bulolo goldfields in the Territory. They were successful in their quest, and rich returns of gold were obtained from the dredging and sluicing leases already mentioned, and also from other leases and claims in the name of the husband. The financial side of the adventure was operated through accounts in the name of the husband. In October of 1927, the husband transmitted to his wife in Brisbane, Queensland, the sum of £3,000. It represented, no doubt, part of the proceeds of gold won in New Guinea. The precise source of the gold is unproved, but the fact is of no importance.

It is unnecessary to traverse all the evidence given in this case, which I have considered with the assistance of the exhaustive judgment of the learned Chief Judge and the arguments addressed to us by learned counsel. In my opinion, the findings of fact made by the Chief Judge cannot be disturbed, and ought to be acted upon.

The appellant, however, contends that, under the law of New Guinea, the respondent, as a married woman, is not capable of independent acquisition and enjoyment of property. What then are the mutual proprietary rights and obligations of a husband and wife in the Territory of New Guinea? The Mining Ordinance 1922-1923 empowers the administrator to grant sluicing or dredging leases to any person, but it does not regulate the relations of husband and wife. The Laws Repeal and Adopting Ordinance 1921-1933 applies certain laws of the Commonwealth, of the State of Queensland, and of the administration during the British military occupation, to the Territory. But none of these laws regulates the relation of husband and wife. Sec. 16 of the Laws Repeal and Adopting Ordinance also provides that "the principles and rules of common law and equity that were in force in England on the ninth day of May, one thousand nine hundred and twenty-one, shall be in force in the Territory so far as the same are applicable to the circumstances of the Territory, and are not repugnant to or inconsistent with the provisions of any Act, ordinance, law, regulation, rule, order or proclamation having the force of law that is expressed to extend to or applied to or made or promulgated in the Territory." By the rules of the common law, a wife was incapable of acquiring or enjoying property, real or personal, independently of her husband. But in equity, if property were given to a wife in such terms as to show an intention that she should enjoy it separately, then effect was given to that intention. Gradually the rules of the common law with regard to the acquisition and enjoyment of property by a wife were altered, by the Married Women's Property Acts, and married women became entitled to hold, acquire and dispose of property, real and personal, as if unmarried. The development of the rules of English law relating to the proprietary rights of husband and wife has been continuous, and the rules of the common law, the doctrines of equity, and statutes, have all played a part in this development. The provisions of the Married Women's Property Acts in force in England on 9th May 1921 may therefore be regarded as part of "the principles and rules of common law and equity" referred to in sec. 16 of the Laws Repeal and Adopting Ordinance. Indeed, I doubt if the words "the principles and rules of common law and equity" can be distinguished from the phrase found in 9 Geo. IV. c. 83, sec. 24—the "laws and statutes in force within the realm of England ... shall be applied in the administration of justice in the Courts of New South Wales and Van Dieman's Land ... so far as the same can be applied within the said Colonies." Consequently, in my opinion, a married woman in the Territory of New Guinea is capable of acquiring and enjoying property as if she were a feme sole, or unmarried.

The result is that the appeal should be dismissed.

Appeal dismissed with costs.

Solicitor for the appellant, V. A. Florance, Rabaul, New Guinea, by F. E. McElhone.

Solicitors for the respondent, McLennan & Clark, Rabaul, New Guinea, by Dawson, Waldron, Edwards & Nicholls.

[1] [1930] HCA 14; (1930) 43 C.L.R. 536, at pp. 562, 563.