ACN 097 590 817 Pty Ltd as Trustee of the ACN Trust v Ede;Adamson v Ede

[2007] NSWSC 1384

CITATION:	ACN 097 590 817 Pty Ltd as Trustee of the ACN Trust v Ede;Adamson v Ede [2007] NSWSC 1384
HEARING DATE(S):	26, 27, 28, 29 November 2007
JUDGMENT DATE :	14 December 2007
JURISDICTION:	Equity Division
JUDGMENT OF:	Windeyer J at 1
DECISION:	Order Judgment for $80,000 and interest. Claim otherwise dismissed. On cross-claim orders for withdrawal of caveats. Declaration charge inoperative and void.
CATCHWORDS:	CONTRACTS - various contracts, charges and transfers between solicitor and client or trust company controlled by solicitor and client - whether transfer signed partly in blank - whether charge to secure debt effective under Real Property Act - charge not valid under that Act and not capable of registration - SOLICITORS - lien over documents - whether documents taken by client - claim in conversion - no damage proved
LEGISLATION CITED:	Bankruptcy Act 1966 (Cth) Contracts Review Act 1980 Family Law Act 1975 (Cth) Real Property Act 1900
PARTIES:	ACN 097 590 817 Pty Ltd as Trustee of the ACN Trust (Plaintiff/Cross Defendant in 6285/03) Kenneth John Ede (Defendant/Cross Claimant in 6285/03) Christopher Michael Adamson (Plaintiff in 3712/06) Kenneth John Ede (Defendant in 3712/06
FILE NUMBER(S):	SC 6285 of 2003; 3712 of 2006
COUNSEL:	In Person (Plaintiff in 3712/06) Mr C Adamson (Solicitor) (Plaintiff/First Cross-Defendant in 6285/03) In Person (Second Cross-Defendant in 6285/03) Mr G Sirtes (Defendant in 3712/06 and Defendant/Cross-Claimant in 6285/03)
SOLICITORS:	In person (Plaintiff in 3712/06 and Second Cross-Defendant in 6285/03) Mr C Adamson (Plaintiff/First Cross-Defendant in 6285/03) Horowitz and Bilinksy (Defendant in 3712/06 and Defendant/Cross-Claimant in 6285/03)

- 21 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

WINDEYER J

FRIDAY 14 DECEMBER 2007

3712/06 CHRISTOPHER MICHAEL ADAMSON V KENNETH JOHN EDE
6285/03 A.C.N. 097 590 817 PTY LTD AS TRUSTEE OF THE A.C.N. TRUST V KENNETH JOHN EDE

JUDGMENT

1 This judgment concerns two actions heard together. One of these number 3712/06, was commenced in the Local Court. In that action Mr Adamson (Adamson), who is a solicitor, claimed he was entitled to a lien over a file in connection with Supreme Court proceedings by Esanda Limited against Mr Ede (Ede) and his wife. Adamson says that the defendant has possession of the file, and that certain costs in other proceedings are due to him by Ede and perhaps by his wife. He is seeking an order for delivery up of the file and in the alternative for judgment for the value of the lien, together with claims for consequential and aggravated damages.

2 On 13 June 2006, Associate Justice Macready made an order transferring the Local Court proceedings to this Court, it seems on the basis that the action would take little time and could conveniently be tried at the same time as the main action.

3 The other claim, number 6285/03, is the main action. In it the plaintiff company seeks various orders including an order to have transferred to it a two-thirds share of a property known as Lot 106 Trapyard Road, Wang Wauk near Bulahdelah being Lot 106 in DP 753156 (the property) and, it seems in the alternative, judgment for moneys outstanding under a loan agreement dated 31 July 2001.

4 By cross-claim the defendant, Ede, seeks orders against both the plaintiff company and Adamson to set aside various documents upon which the plaintiff claims an interest in the property. Ede does not dispute the sum of $80,000 and interest.

Parties to the main action

5 The plaintiff and first cross-defendant, A.C.N. 097 590 817 Pty Limited (A.C.N.) is trustee of a trust known as The A.C.N. Trust. The trustee of that trust was previously Oz 1 Pty Limited and the trust was then known as the Oz 1 Trust. The beneficiaries under the trust deed are Adamson and other members of his family. While this has nothing to do with the matter, it does seem to me that although companies can be called by some A.C.N. number all this does is create unnecessary confusion and difficulty.

6 The defendant, Ede, was a builder. He got into financial difficulties and he and his wife were sued by Esanda Limited. He was also involved some years later in family law proceedings with his wife Parmilla Ede. Those proceedings were finally resolved in August 2001.

7 Adamson is the second cross-defendant. He is a solicitor and was entitled to practise as such during the period from 1995 until the present time. He was, however, made bankrupt on his own petition on 22 December 1992 and discharged automatically on 23 December 1995.

Facts

8 Adamson and Ede were friends. From time to time during the course of the events described here they have lived together. Ede was involved in difficult litigation with Esanda and Adamson offered to assist with that. They entered into a deed dated 4 October 1995. So that the matter can be understood I think it necessary to set out the deed in full and a copy is annexed to this judgment.

9 Prior to this deed being entered into Mr and Mrs Ede had entered into a deed with Adamson dated 10 September 1995, which looks like an employment contract, but which was probably a retainer agreement under which Adamson was to perform legal work for Mr and Mrs Ede for up to five hours per week for a retainer of $50 net of tax per week and thereafter at $10 per hour after tax for time spent over the five hours. This was the charge which was to apply other than in contentious matters, where the appropriate scale was to be charged instead. The deed included an extraordinary clause excluding any liability in Adamson for any act, omission, wrong advice, recklessness or negligence. There is no application in these proceedings to set it aside. It could, in any event, have been terminated by either side on notice.

10 In 1998Adamson lodged a caveat number 5388466 claiming a one half share over the property pursuant to a deed dated 10 September 1995. There is no evidence of any deed of that date apart from the one just mentioned. That deed gave no interest in the property. Adamson signed the declaration required for the caveat on 10 September 1998. He also purported to sign for the registered proprietors under power of attorney said to be dated 5 October 1995. There was no power of attorney of that date, although Ede gave an unlimited power of attorney to Adamson on 16 January 1996 and Mrs Ede signed a similar document on 14 January 1996. The result of the registered proprietors’ consent being on the caveat document was that no notice was given of the caveat to the registered proprietors by the Registrar-General: Real Property Act 1900 s74F. It might have been possible to claim an interest under clause 3 of the deed of 4 October 1995, but the fact is that was not done.

11 On 30 January 2000 Adamson purported to assign his interest under the deed of 4 October 1995 to the Oz 1 Trust. The consideration was stated to be the market value or $10,000, whichever was the greater, with interest at 10 percent per annum. The consideration under the deed was to be paid in ten years or from the net proceeds of any sale of the interest in the property whichever occurred first. The assignment was signed by Adamson as assignor and as trustee of the Oz 1 Trust. He was one of three trustees. It is not clear the assignment was effective as there is nothing in the trust instrument which would have given the necessary power to one trustee. In any event the property the subject of the assignment was acquired while Adamson was an undischarged bankrupt. It is therefore ‘after-acquired property’ vesting in the trustee in bankruptcy under s58(1)(b) of the Bankruptcy Act 1966 (Cth) and thus is property devisable among creditors. Discharge from bankruptcy on 23 December 1995 did not affect that position. The limited protection of s126 of the Bankruptcy Act does not in my view apply.

12 On 28 July 2001 Adamson, as appointor under the Oz 1 Trust deed, removed the then trustees, namely himself, Phillip Jackson and Oz 1 Pty Limited and appointed A.C.N. as trustee. It was also resolved at the same time to change the name of the trust from Oz 1 Trust to the A.C.N. Trust.

13 Mr and Mrs Ede were involved in 2001, and perhaps earlier, in negotiations to settle their matrimonial affairs. On 19 July 2001 orders were made under the Family Law Act 1975 (Cth) in the Local Court at Forster, the effect of which was that in consideration of being released from any mortgage liability over the property and in consideration of receipt of $80,000 from Ede, Mrs Ede agreed to transfer her interest in the property to her husband. There was a note attached to the approved consent terms of settlement that the property was subject to a first mortgage to secure $80,000 and to an equitable charge in favour of Adamson for legal costs. The application for consent orders signed by Mr and Mrs Ede does show $30,000 due to Paclaw solicitors, Adamson’s then firm, although Ede says that his initials against this addition are not his.

14 For the Family Law orders to be implemented Ede had to obtain $80,000 to pay out Mrs Ede, and in order to pay out the existing mortgage he had to organise a new mortgage loan through Suncorp Metway of about $82,000. The A.C.N. Trust agreed to lend Ede $80,000 or, it claims, $82,000 under a deed of loan dated 31 July 2001, which sum was to be secured on the property but subject to a first mortgage to Suncorp Metway for $82,000. On the same day and time as the deed of loan was signed three other documents were signed. There is a contest as to whether they were complete when signed. The first is a transfer in Real Property Act form, although not in registrable form. Under that as it now is Ede acknowledges receipt of the consideration of “deed dated 4 October 1995 and the forgiving of $80,000 loan” and transfers to the plaintiff company as trustee for the A.C.N. Trust “a two-thirds share and Kenneth John Ede as a one-third share as tenant in common A.C.N. Trust sole proprietor proposed Lot 1063 and tenant in common with Kenneth Ede as Lots 1061 and 1062 in equal shares”. It is obvious enough that this document could not be registered as there was no plan of sub-division so far as the proposed lots were concerned. The third document signed on that date was a residential tenancy agreement from Ede to Adamson and the A.C.N. Trust for part of the property being the house and surrounding sheds and surrounding ground. This lease was for a term of three years. It purports to have two options each for a period of a further three years. It says nothing of the terms on which any option could be exercised. A notice to quit was served on both Adamson and the A.C.N. Trust in December 2004 with no result. Adamson remains in occupation. Whether the company does or not does not really matter. Adamson as solicitor lodged caveat AA 88405 against the title based on the transfer document apparently with the consent of Ede endorsed, although there may be some problem about that signature. The caveat is dated 22 October 2003.

15 The fourth document dated 31 July 2001 is a charge stated to be imposed upon Ede’s one-third share of the property “for the purpose of securing the payment of past and future legal fees for the benefit of Adamson, the payments to be made upon issue of accounts and thirty days.” There was no underlying agreement for this document of charge.

16 All the documents signed on 31 July 2001 were witnessed by Mr Faddoul Faddoul JP.

Pleadings

Transferred detinue action

17 The amended statement of claim pleads judgments against Ede for costs under two orders, fails to plead non-payment, pleads that Ede has all or some of the contents of the file of Adamson in relation to the proceedings in defence of the claim by Esanda, does not plead the taking of that file by Ede, claims a lien over it and an unsatisfied demand for its return. The statement of claim seeks judgment for detinue or the value of the lien, damages and aggravated damages.

18 The amended defence is a very poorly expressed document. How it could have been prepared by a solicitor even for the Local Court I cannot comprehend. Insofar as it does anything it denies any amounts outstanding for costs, denies any obligation to return the file and says in any event that the file has no value.

Main action

19 The plaintiff A.C.N. pleads the 1995 deed, its assignment, the deed of loan and payment of the $82,000 thereunder and that further loans were made pursuant to the deed amounting to $16,164. It then pleads in paragraph 11 (as amended during the hearing) as follows:

11. The terms of the agreement are contained in a transfer dated 31 July 2001 duly executed by the defendant and the plaintiff. A term of the written agreement being that in consideration of the Deed dated 4 October 1995 [intended by the plaintiff and the defendant to mean that “in consideration [of the plaintiff forgoing the benefit] of the deed dated 4 October 1995”] and the forgiveness of the loan of $80000.00, the defendant transferred to the plaintiff a 2/3 share of Lot 106 DP 753156 land as tenant in common with the defendant as to the remaining 1/3 share and to the plaintiff as sole proprietor proposed lot 1063 and as tenant in common in with the defendant as to proposed lots 1061 and 1062 in equal shares (the written agreement).

20 The plaintiff then pleads a refinancing in August 2001 of the first mortgage, and its lodgement of caveat AA 88405 claiming an interest pursuant to the transfer. It also pleads entitlement to two-thirds of the agistments received from the property. The plaintiff seeks declarations as to its interest in the property, an order for specific performance by way of execution of documents required to give effect to the agreement as contained in the transfer, including obtaining the necessary consents to sub-division, and also seeks orders for partition or sale of Lots 1061 and 1062 and for an account of agistment moneys and repayment of the loan moneys.

Defence to main action

21 The defendant (a) says as to the 1995 deed it is unenforceable under the Contracts Review Act 1980 (NSW) and is void for uncertainty; (b) says as to the assignment it is void for uncertainty; (c) says the sum received under the deed of loan was $80,000 not $82,000 and denies further loans; (d) says that the transfer is void for uncertainty; (e) pleads as to specific performance, laches, hardship and unfairness and that any order would require supervision.

22 Defences based on lack of writing became unnecessary as the plaintiff’s claim that the agreement was partly oral was not pursued and amendments to the further amended statement of claim as indicated in the transcript were deemed to be made. No argument was addressed to the defences of laches, hardship or supervision requirement.

Cross-claim I n main action

23 Ede brings the cross-claim against Adamson and A.C.N. Once again the document is quite inadequate. However, its general thrust is clear enough. It pleads (a) the two caveats, the lack of interest claimed by them, and seeks their removal; (b) that the 2001 documents were represented by Adamson as required for the Family Law proceedings; that the transfer was blank; that all the documents were signed in the presence of Mr Faddoul in his tobacconist shop at Kings Cross and that Adamson was present; that the documents were not required for the stated purposes, or not all of them were; and that the transfer was filled in at a later date and there was no consideration for it; (c) as to the 1995 deed it was signed without reading or explanation or independent advice and it was to the disadvantage of Ede and was either not binding or was unjust under the Contracts Review Act and should be set aside; (d) as to the deed dated 10 May 2001, it gave no caveatable interest, that the original retainer ended on 19 March 1996, but was revived for the Family Law proceedings and in any event was offset by rent paid by Ede on behalf of Adamson; (e) that Adamson occupies the property as trespasser.

24 Ede seeks in the cross-claim orders (a) for withdrawal of the caveat, (b) for cancellation of the transfer, (c) a declaration that the charge dated 30 July 2001 is of no force and effect; (d) that the deed of 10 May 1995 be rectified to say its term has expired and (e) to set aside the 4 October 1995 agreement under the Contracts Review Act.

25 In the defence to cross-claim Adamson says he did work for the cross-claimant from 1995 to 2003 and that the documents were all signed for a proper purpose. In addition it is claimed that the cross-claim cannot succeed because so far as the 1995 agreement was entered into, it was entered into for the purpose of the business of Ede, namely his painting business, and that it is barred by time under s16 of the Contracts Review Act.

Stamping of documents

26 When the hearing commenced before me the only document which had been stamped was the charge over the land for past or future legal costs. The deed of 4 October 1995, the deed of assignment and the deed of loan had not been stamped. I allowed the 4 October 1995 deed and the deed of assignment into evidence on appropriate undertakings although I had some doubts about that. I refused to allow the deed of loan into evidence until it had been stamped. It was subsequently placed into evidence having been stamped with what appears to have been an interim stamp. This matter is of some significance. On the case made out by the plaintiff it is perfectly clear that the documents were liable for stamping. It was a solicitor, Adamson, who was in charge of the documents. It was the solicitor, or his company, that was liable to stamp duty on the original deed and on the deed of assignment. It is not necessarily easy to find that a solicitor liable for stamp duty on documents intends them to operate on their terms if they have not been stamped for many years.

Problems

27 A significant problem in determining this action is the inadequacy of the pleadings. While it is desirable to determine matters between the parties, so they can so far as possible go their separate ways, that can only be done so far as it would be reasonable and fair to order the pleadings be amended to coincide with the evidence. While the main action has been on foot for about five years it is perfectly clear that inadequate consideration has been given to any proper attempt to plead so as to define the issues.

28 Instances of this problem are: (a) the only claim under the Contracts Review Act is to set aside the deed of 4 October 1995. Submissions were made as to relief under that Act in relation to the costs deed of 10 May 1995 and residential tenancy lease, but the matter cannot be dealt with by somehow making a claim at the hearing in oral or written submissions without any amendment; (b) an argument was raised and evidence led about the bankruptcy of Adamson and its effect on the October 1995 deed. That raises problems for each side which on one view are not able to be properly dealt with without the trustee in bankruptcy being made a party. The defence denying that Adamson obtained an interest under the deed of 4 October 1995 did not properly raise or give notice of the argument now raised. A non-admission of the assignment by Adamson to A.C.N. of the benefit of the deed and a claim it is void for uncertainty likewise does not properly plead the facts relevant to the argument put forward.

29 It is of some significance to note that the proposed amended defence was notified on 25 October when new solicitors were engaged. There has been no amendment to the cross-claim. There was time to get appropriate pleadings notified and ready. As the evidence of the bankrupt estate was allowed in I think it proper to deal with that particular problem, partly as it goes both ways, but I do not consider it would be fair to the cross-defendant to allow the cross-claim to be dealt with on the basis of matters not raised in it or in respect of some matters which were only raised in submissions.

30 It is also necessary to say that apart from the Contracts Review Act matters there is no specific defence or cross-claim based on undue influence. I do not accept any evidence of Adamson that Ede had an opportunity to obtain independent advice in respect of the documents which he signed. It seems extraordinary that this was not raised in circumstances where the documents relied upon by a solicitor confer a considerable benefit on that solicitor as against the client.

Deed of 4 October 1995

31 If this deed vested any property rights in Adamson the said rights would be after-acquired property which would vest in the trustee in bankruptcy. There was no evidence of any notice to the trustee of the property. To proceed to declare it to be void or to set it aside under the Contracts Review Act would, I consider, require the joining of the Official Trustee in Bankruptcy as a party. Whatever property there is that was acquired by the deed remains in that trustee.

The deed of assignment dated 30 January 2000

32 It follows from the previous paragraph that Adamson could not assign any interest under the deed of 4 October 1995 without the consent of the trustee. Thus, apart from the problems that might otherwise arise with it, the assignment was ineffective as the property was not vested in the assignor.

Deed of 10 September 1995

33 As the caveat which claimed an interest in the land arising under this deed had lapsed or been removed, there is really no claim in the cross-claim which relies on this deed. It is clear that the document gave no interest in land. No claim for money based on that deed is made under the statement of claim probably because Adamson is not the plaintiff. Under the cross-claim it is alleged that the deed was a contract of employment, which employment ceased on 19 March 1996, after which Ede no longer employed, retained or instructed Adamson as his solicitor. It is also pleaded that any costs were set off against rent due by Adamson to Ede for premises leased by Ede but occupied by Adamson. Adamson, in his defence to cross-claim says that he continued to do work for Ede up to June 2003. The point is that, leaving aside the charge to which I will come, no judgment is sought for costs under this deed.

34 I should say there is no evidence of any costs due by Ede to Adamson but I do not consider that the cross-claimant has proved the facts alleged in paragraph 21B of the cross-claim. Nor has he shown that he is entitled to the only relief sought in respect of that deed, namely an unpleaded claim for rectification and a claim that on its true construction the deed is of no force or effect.

Charge dated 31 July 2001

35 “Charge” is defined in s3 of the Real Property Act as “any charge on land created for the purpose of securing the payment of an annuity, rent charge or sum of money other than a debt”. The charge which the cross-claimant seeks to have declared void by the cross-claim, whatever may be its defects in creating a charge without any other document, states that it is for the purpose of securing “past or future legal fees” … “the payment to be made upon issue of accounts and thirty days”. On any basis this is a charge to secure past or future debts. It cannot be registered as a charge; neither can it be registered as a mortgage. There is no consideration for securing of past debts, which appears to have been its purpose. It could not, I think, operate as a contract to charge the land for future legal costs and thus it is not an agreement which could be the subject of specific enforcement. For all those reasons it is ineffective and should be set aside. In any event I accept the evidence of Ede that the document was just put in front of him and signed by him, without its being read, on the basis of a statement made to him by Adamson that it was one of the documents required to complete the settlement of the family law proceedings with his wife.

36 I should say that what I have said about the document being ineffective under the Real Property Act was not the subject of argument. Normally I might have relisted the matter for submissions on this question but in the circumstances there is nothing to be gained by it.

Transfer dated 31 July 2001

37 The evidence of Ede was that after the family law proceedings with his wife were settled and consent orders made in the Local Court at Forster he was asked by Adamson to come to Sydney to sign documents to give effect to the settlement. It was of course necessary for Mrs Ede to transfer to her husband her interest in the property and for the mortgage to be discharged and a new mortgage entered into to give effect to the family law agreement and it was necessary for $80,000 to be paid to Mrs Ede being the amount which A.C.N. was to lend to Ede under the deed of loan.

38 In his affidavit of 7 April 2005, Ede said that Adamson produced documents purporting to effect the Family Court settlement and refinancing and that he recalled going with Adamson to sign them at Kings Cross before a Justice of the Peace. He said that to the best of his recollection the documents included a transfer, a residential tenancy agreement for his wife to stay in the property if she wished and a mortgage to Adamson for $80,000. He said that there was another document. He said the wording on the transfer as to part of the description of the land transferred, and the name of the transferee were not on the document when he signed it. In a further affidavit of 24 October 2007, Ede said that Parts A, C and D were not completed when he signed it, namely those parts stating the land, the consideration, and the transferee. Further on in that affidavit he said:

6(g) I first saw the transfer in the following circumstances:
i. I came to Sydney as requested by Adamson and I was moving furniture, cleaning and sorting documents in his garage at Brougham Street Kings Cross. Adamson came downstairs with some papers and there was a discussion between us to the following effect:
Adamson: “You have got to come with me straight away to see a JP and sign some documents for the Family Court settlement.”
ii I went across the road to the Kingsgate building. At a tobacconist shop there was a person there who I now know to be called Faddoul Faddoul. He was a Justice of the Peace.
iii Adamson put some papers on the counter and there was a discussion to the following effect:
Adamson: “You’ll have to sign these papers.”
Me: “I haven’t got my glasses with me.”
Adamson: “Don’t worry, you just sign where I point.”
iv Adamson held his finger on the documents and I signed next to where he put his finger. I then saw Faddoul Faddoul sign some documents which I believed was him witnessing my signature.

vi. Whilst I did not have my glasses with me I can see whether there is writing on a document but I can’t make it out because I am long sighted.

vi. Other than my signature and Mr Faddoul’s signature and details and the date there was no handwriting at items in (a), (c), (d) and (f).
vii To the best of my recollection I signed about 4 documents. Adamson said to me at the time words to the effect:-
Adamson: “All these documents are relevant to you property settlement. One of the documents is a mortgage which will be an unregistered mortgage for $80,000.00 that I am going to lend you.”
We then left Mr Faddoul’s shop and we went to the St George Bank at Kings Cross. Mr Adamson produced $36,000.00 which was then banked into my account.

7. I also refer to document discovered no. 22 in the Plaintiff’s Discovered Documents being a Charge also dated 31 July 2001. I do not recall having seen that document prior to swearing my 7 April 2005 affidavit but, having reviewed its contents, I say as follows:

(a) I accept that this document was signed by me in the presence of Faddoul Faddoul, in circumstances set forth in the preceding paragraph, on 31 July 2001;

(b) The document that I did sign had no other hand writing on it other than my handwriting, the date and in certain places the Justice of the Peace’s handwriting.
8. At the time that I signed the documentation before Faddoul Faddoul in Kings Cross on 31 July 2001, Mr Adamson was acting on my behalf as my solicitor in the Family Court proceedings against my former wife.

39 In spite of the original evidence by Ede being sworn in April 2005, Adamson made no response until these proceedings commenced on 27 November 2007. He denied the allegations about execution and said that he was not present when the documents were executed. He said that when he executed the documents they were complete. In addition in an affidavit by him sworn 27 November 2007 at paragraph 28 he said:

28. Thereafter I had conversations with Parmilla and Richard her son and with the defendant. The result of these discussions was that the defendant: “Will you lend me monies on an ongoing basis to assist me in my business and to enable me to do a matrimonial property settlement with my wife.” I said to the defendant: “Alright, I will arrange for my family trust to make loans to you on an ongoing basis pursuant to a deed of loan including up to $80000.00 to enable you to do a settlement with you wife. Such loans to be repayable with interest at 10% p.a. in the next couple of years and to be secured over the Trapyard Road property. Provided further that if and when the land is duly refinanced and registered in you name, my family trust will forgo the benefit of the deed dated 4 October 1995 and forgive the repayment of the $80000.00 loan in return for a 2/3 share of the property prior to subdivision and as sole proprietor of proposed lot 1063 being the proposed lot containing the building and residence and as tenant in common with you in proposed lots 1061 and 1062 in equal shares and I will require you to do all things and to execute all documents to give effect to such agreement including a transfer(s) and consent caveat.” The defendant replied “I agree.”

40 It is the transfer which is the most important document in this case. It is right to say that Adamson was not a convincing witness and Ede was not totally convincing either. Adamson’s conduct at the commencement of the trial in endeavouring to say that he had not been served with documents because they did not come from the solicitor on the record was ridiculous and I would think improper. His conduct in lodging a caveat based on a document which gave no interest in land and signing a consent on the authority of a document which did not exist could not, I think, have been in error. His answers as to the state of documents when executed were not direct and I think they were evasive. On the other hand, Ede had given false evidence on oath in other proceedings and his evidence on the state of the documents when he signed them was contradictory, as in cross-examination he said that he saw Adamson’s writing in places on the transfer whereas previously his evidence was that those places were blank.

41 On the validity or effectiveness of the transfer Adamson has the onus. Even he says that the transfer is not correct insofar as it expresses consideration. It has all the hallmarks of later addition, even if added before he signed. The fact is that it is expressed to be consideration of forgiveness of a loan of $80,000 made under a document signed on the same day makes the latter document purposeless. I find that the document was not in its present form when it was signed by Ede. In addition I accept the evidence of Ede that he was told the documents were required for the family law settlement and thus he would have expected to sign a transfer from his wife to him of her interest in the property. On balance I find that the description of the transferee was not inserted when the document was signed by Ede. The description of the subsequent lot numbers was not then known. In fact Adamson signed Ede’s signature on the subdivision application, although on one basis he might have had authority to do so. The document is a nullity. I find Adamson knew of this.

42 Adamson knew the state of the documents and signature was in issue. He could have called the witness. There was no explanation for not doing so. It is proper to infer the witness’s evidence would not have assisted Adamson.

43 The transfer could not be registered even in its present form as now completed. No agreement under the document could be subject to specific performance. That part of the claim should be dismissed. The transfer should remain on the file.

44 I have not overlooked the fact that caveat AA880405 purports to have the signature of Ede consenting to its lodgement. In his affidavit of 7 April 2005, Ede denied signing it. He was not cross-examined on this and, I accept his evidence. A cursory examination of the signature and initialling would give some reason for doubt as to its veracity

Detinue and lien claims

45 Adamson says that the only way Ede could have obtained the Esanda file or part of it was by improper conduct. Ede says that when he was helping Adamson move his property from rented premises to other premises he saw the file and that Adamson told him that it was finalised and that he could have it. I thought that evidence was convincing. The file is of no value to either party so far as I can see, so that even if I were wrong in this, it could not be said Adamson had sustained damage through loss of his lien. The possession of it would not assist in obtaining payment of other costs if any other costs were due. The claim is in conversion and not in trespass. No damage is established. The claim should be dismissed.

46 While the claim is dismissed it is the defendant who sought transfer to this Court. That order was made but I cannot see that there was anything gained by the transfer. In the circumstances I consider that I should fix the costs of those proceedings at a figure which would bear some relationship to costs which might have been incurred in the Local Court and accordingly I fix those costs at $750.

Orders on main action

47 The plaintiff’s claim for an interest in land must be dismissed. It follows that the claims for agistment must fail in any event they have not been proved. The caveat filed by the plaintiff must be withdrawn. The plaintiff is entitled to judgment for $80,000 plus interest on that amount pursuant to the deed of loan. There is no evidence of any further moneys being due under that deed.

Cross-claim

Deed dated 10 May 1995

48 The deed, bad as it is, can be terminated at any time on notice. There is no evidence of notice being given. The amount in question is a retainer of $50 net per week for the first five hours and $10 per hour after tax thereafter for non-contentious work. For contentious work under the deed Adamson is entitled to charge upon the applicable court scale. In spite of the evidence of Adamson to say that this meant whatever rates were allowed on assessment that could no be correct. The evidence does not enable me to hold that the retainer ceased on 19 March 1996. There is no evidence to support the rectification claim.

Deed of charge dated 31 July 2001.

49 I have already stated that this charge is of no effect and should be set aside.

Deed of 4 October 1995

50 For the reasons I have stated, in the absence of necessary parties, this deed cannot be set aside under the Contracts Review Act if it were otherwise right to do so.

Claim for possession

51 The claim of Ede is that Adamson is a trespasser. The answer to that claim is the residential lease. There is no claim made in the cross-claim or by reply to the defence to the cross-claim to have the lease declared void or have it set aside under the Contracts Review Act. While I might have had considerable doubts about the document, the state in which it existed when it was signed by Ede, and the statements which were made to him about it, these are not matters which can be determined in a way fair to the parties on the issues put forward for decision.

Costs

52 I have been asked to stand over the question of costs for further argument.

Proposed orders

1. Order the proceedings be dismissed.

2. Order the plaintiff pay the costs of the defendant fixed at $750.

A. Amended Statement of Claim

1. Judgment for plaintiff against the defendant for $80,000 plus interest at 10% per annum from 31 July 2001.

2. Order the amended statement of claim be otherwise dismissed.

B. Cross-claim


3. Declare the charge dated 31 July 2001 void and of no effect.

4. Order that the cross-defendant withdraw caveats AA88405 and AB349413 within 14 days.

5. Order the cross-claim be otherwise dismissed.

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