MBP Properties Pty Ltd v Barnes – An expansion of the partition provisions of the Property Law Act 1969 (WA)?

In MBP Properties Pty Ltd v Barnes [2026] WASC 276, the Supreme Court ordered the sale of a property under s126(2) of the Property Law Act 1969 (WA) (PLA) at the request of a minority interest holder, who owned a 23% share.

Factual background

The plaintiffs applied under s126(2) of the PLA for an order that a property in Lesmurdie be sold (Property). The relevant parties were:

• First plaintiff: MBP Properties Pty Ltd (MBP), owning a 23/100 share in the Property.
• Second plaintiff: Karin and Peter, the directors of MBP, who are husband and wife.
• Defendant: Virginia Barnes, owning a 77/100 share in the Property.

Virginia is the younger sister of Karin.

The circumstances of this case were complicated by agreements between family members.

In 2007, due to a separation, Virginia required financial assistance and received:

• $120,000 from Karin and Peter to purchase her ex-husband’s interest in the Property; and
• $150,000 from Virginia and Karin’s mother to discharge the mortgage over the Property.

Virginia then transferred a 23/100 share in the Property to MBP (the entity nominated by Karin and Peter) as tenants in common, retaining a 77/100 share.

In 2019, Karin and Peter decided to purchase MBP’s interest. They asked Virginia to provide the duplicate certificate of title. Virginia declined and disputed MBP’s interest in the Property.

It was common ground that the Property could not be subdivided, so partition of the Property was not realistic.

Issues

The central issue was the terms of the agreement between the plaintiffs and Virginia regarding MBP’s acquisition of its interest in the Property.

Virginia also advanced an estoppel claim to resist the sale. She alleged that Karin made representations amounting to a clear promise that the distribution of their mother’s estate meant that Virginia was buying back MBP’s interest in the Property.

In response, the plaintiffs pleaded a breach of fiduciary duty and their own estoppel claim. Because Virginia did not establish her estoppel claim, the Court did not need to resolve these issues.¹

The final issue was whether, in all the circumstances, the Court should exercise its discretion to order the sale of the Property under s126(2) of the PLA.

Findings

The terms of the agreement of MBP’s acquisition of its interest in the Property

Upon review of the evidence, Seaward J concluded that there was a binding agreement with the following essential terms:

• Karin and Peter buy out Virginia’s ex-husband’s interest in the Property for $120,000; and
• in return for a 23/100 share in the Property, which Virginia could buy back at a later stage.

The agreement was silent on what MBP could do with its interests. Nothing prevented MBP from:

• selling its interest;
• asking Virginia to buy-out its interest; or
• making an application for the sale of the Property under the PLA s126.

Virginia’s estoppel claim

To resist the sale, Virginia claimed that:

• the distribution of her and Karin’s mother’s estate was a representation or promise by Karin that Virginia was “buying back” MBP’s interest in the Property; and
• the plaintiffs were estopped from denying that the distribution constituted such a buy‑back.

Seaward J rejected Virginia’s estoppel claim. When the Court considered all communications concerning the estate in context, it found no clear and unequivocal representation that the distribution amounted to Virginia buying back MBP’s interest.

The Court’s discretion to order the sale of the Property

The power under s126(2) of the PLA can only be exercised if the court is satisfied that a sale of the land would be ‘for the benefit of the parties interested’.

The Property was a residential dwelling in Lesmurdie, and the parties accepted that the Property is not suitable for partition.

In short, the Court was satisfied that:

• it would be for the benefit of the parties to order a sale of the Property; and
• it should exercise its discretion to order a sale of the Property.

The Court reached this conclusion because:

• MBP had owned its interest since 2007 and Karin and Peter, as directors, wish to realise their interest;
• nothing in the terms of the oral agreement regarding MBP’s purchase of its interest prevented an order under s126(2) of the PLA;
• Karin and Peter had communicated in 2015, and again from 2019 onwards, that they wished to sell MBP’s interest;
• Karin and Peter had given Virginia the opportunity to purchase MBP’s interest, but she did not accept those offers; and
• whilst the Property is Virginia’s residential home, no evidence was offered that the sale of the Property would cause any particular hardship to any of the parties.

In the end, Virginia had the benefit of living mortgage‑free in the Property since MBP acquired its interest, and she was able to raise her children there until they left home.

Conclusion and orders

The plaintiffs were successful in seeking orders for the sale of the Property pursuant to s126(2) of the PLA.

Virginia’s counterclaim was dismissed.

Key takeaways

The Court is willing to order the sale of a property on the application of a minority interest holder. This is a departure from the previously commonly held view that a the holder of a minority interest in land would not obtain an order for the sale of the land.

Arrangements and agreements between family members can turn a deceptively simple claim into complex litigation.

Regardless of any counterclaim or defence, a defendant should still lead evidence of any particular hardship (financial or otherwise) that may arise if the Court orders the sale of their property. In this case, the defendant led no such evidence.

This decision could see further cases in which the holders of minority interests in land seek orders from the courts for the sale of the land.

Thanks to Lavan law clerk Christopher Hunter for his assistance in the preparation of this update.

Disclaimer

The information contained in this publication does not constitute legal advice and should not be relied upon as such. You should seek legal advice in relation to any particular matter you may have before relying or acting on this information. The Lavan team are here to assist.

Footnotes

[1] See MBP Properties Pty Ltd v Barnes [2026] WASC 276, [412]-[427].