Ardestani v Doss

[2018] NSWSC 1084

Supreme Court

New South Wales

• Summary available
• Amendment notes

Medium Neutral Citation:	Ardestani v Doss [2018] NSWSC 1084
Hearing dates:	18, 23; 24 April 2018
Date of orders:	17 July 2018
Decision date:	17 July 2018
Jurisdiction:	Equity
Before:	Ward CJ in Eq
Decision:	1.   Dismiss the plaintiffs’ claim with costs. 2. Order that the plaintiffs cause to be removed any caveat lodged under the Real Property Act 1900 (NSW) by the first plaintiff or the second plaintiff in relation to the land situated at 11 Vivaldi Place, Beaumont Hills being lot 6 of DP1023156.
Catchwords:	EQUITY – Equitable remedies – Alleged oral arrangement under which plaintiffs provided funds to the defendants as contribution to the purchase price of real property and later its renovation – Defendants later sold property – Declarations sought on the basis of existence of express or resulting trust – Declarations alternatively sought that defendants bound by an estoppel or contract
Legislation Cited:	Civil Procedure Act 2005 (NSW), s 100
Cases Cited:	Macquarie Developments Pty Limited v Forrester [2005] NSWSC 674 Seamez (Australia) Pty Ltd v McLaughlin [1999] NSWSC 9
Category:	Principal judgment
Parties:	Navid Miraki Ardestani (First Plaintiff) Sepideh Miraki (Second Plaintiff)] Helen Doss (First Defendant) Harry Mehmani (Second Defendant)
Representation:	Counsel: G Carolan with M Fernandes (Plaintiffs) DK Ratnam (Defendants)   Solicitors: Birchgrove Legal (Plaintiffs) Armstrong Legal (Defendants)
File Number(s):	2016/00364581
Publication restriction:	Nil

Judgment

1. HER HONOUR: This matter involves a dispute between two Iranian couples: the plaintiffs (Mr Navid Miraki Ardestani and his wife, Ms Sepideh Miraki) and the defendants (Ms Helen Doss and her husband, Mr Harry Mehmani). The first plaintiff (in accordance, I was informed, with Iranian custom) is known as Mr Miraki and I will refer to him as such. Each of the defendants was formerly known by a different name (Ms Doss, as Maryam Mohammadi Aghdam; Mr Mehmani as Hossein Gharrehdagi), which I note simply to explain that there is reference in some of the evidence to one or both of the defendants by their former names.

2. The respective wives, Ms Miraki and Ms Doss, are first cousins. Their husbands (Mr Miraki and Mr Mehmani) for some time worked together as painting contractors. There are widely differing accounts as between the respective couples as to various matters (including the degree of friendship between the four; whether the defendants ever “set foot” in the plaintiffs’ house; and whether, for a time, they jointly engaged in a business of the purchase and repair of used and/or damaged cars) but the most significant dispute for present purposes, being the subject of the claims made by the plaintiffs in these proceedings, is a dispute as to whether the couples were party to an agreement in about late April 2010 for investment in certain real property in Kellyville.

3. It is alleged by the plaintiffs that moneys were advanced by them to the defendants between the period 2010 to 2012 to buy a house in Kellyville in Ms Doss’ name and for the renovation of that house; and that it was agreed that upon the sale of that house the defendants would repay all of the plaintiffs’ contributions to both the purchase price and the cost of renovation; and the net profit would be split in proportion to the respective contributions of the plaintiffs and the defendants. The Kellyville property was indeed bought in Ms Doss’ name in December 2010 for the sum of $610,000. It was renovated by March 2011, at which time the defendants moved into the Kellyville property. It was sold in 2014 for the sum of $905,000. No part of the proceeds has been distributed to the plaintiffs. The defendants deny the alleged agreement and deny the receipt of any funds from the plaintiffs for the purchase or renovation of the property.

4. In summary, the plaintiffs argue that the defendants were not in a financial position to have acquired and renovated the Kellyville property from their own funds at the relevant time and say that they assisted the defendants to do so because of the family connection between them; whereas the defendants (albeit that this was raised for the first time only shortly before the hearing) say that the requisite funds were sourced from Iran (with the assistance of a money lender in Sydney).

5. As to the late emergence of evidence in relation to an Iranian bank account (in Mr Mehmani’s name), it appears that a forensic decision was taken on the part of the defendants not to obtain or serve any such evidence at an earlier time (see T 275.36ff). I was informed by Counsel for the defendants that it was not until the plaintiffs had issued a notice to produce on 2 February 2018 and the Registrar was hearing the defendants’ (ultimately unsuccessful) application to set aside that notice to produce that it became apparent that the plaintiffs were seeking to “probe a suspicion” that certain funds held in the defendants’ bank accounts were in fact the funds provided by the plaintiffs; and were seeking to probe the defendants’ ability to service the loan which had been taken out with Bankwest.

6. That led to the service of Ms Doss’ second affidavit affirmed 12 March 2018 and an affidavit affirmed on the same date by a retired money exchanger (Mr Homayun Abedini) on which the defendants now rely as evidence of the deposit of funds into Ms Doss’ bank account that they say emanated from moneys belonging to Ms Doss in Iran (with which it is said that Ms Doss was able to fund the acquisition of the house without the plaintiffs’ assistance). Much of Mr Abedini’s affidavit was the subject of objection by the plaintiffs and either read as an assertion or read provisionally subject to the basis of the matters deposed to being adduced in oral evidence at the hearing. I deal in due course with the substance of Mr Abedini’s evidence.

Background

7. Set out below is a chronological summary of the events allegedly giving rise to the present dispute, on one or other side’s version of the facts. As adverted to above, much of what is said by either side is disputed by the other. I will deal in due course with the necessary factual findings to be made.

Events leading up to the purchase of the Kellyville property

The parties

8. Mr Miraki emigrated to Australia from Iran in about 2000 (see his first affidavit affirmed 5 December 2016 at [3])). His evidence is that he was acquainted with Ms Doss, who he says was a family friend, prior to arriving in Australia (see [4] of his first affidavit). This is disputed by Ms Doss. Ms Doss’ evidence is that she did not meet Mr Miraki until 2002 when she and her husband attended the plaintiffs’ wedding (see [8] of her first affidavit affirmed 8 September 2017).

9. The defendants’ evidence is that they were married in Iran in April 2000 and emigrated to Australia in 2001 (see Ms Doss’ first affidavit at [5]; [10]; Mr Mehmani’s affidavit affirmed 8 September 2017 at [5]; [10]; cf Mr Miraki’s first affidavit at [4] which puts the marriage as being in the late 1990’s).

10. The defendants’ evidence is that, upon arrival in Australia, Ms Doss (who was then twenty-one) commenced studying (first at a high school and then at Bankstown College) and Mr Mehmani commenced work as a contract painter (Ms Doss’ first affidavit at [10]; Mr Mehmani’s affidavit at [10]).

11. The plaintiffs met each other in Australia in 2001 and were married in 2002 (Mr Miraki’s first affidavit at [6]; Ms Miraki’s affidavit affirmed 1 June 2017 at [7]). As already noted, and this is not disputed, the defendants attended the plaintiffs’ wedding in 2002.

12. Both Mr Miraki and Ms Miraki gave evidence that Mr Miraki became “good friends” with Mr Mehmani (and Mr Miraki deposed that he also became good friends with Ms Doss) (see Mr Miraki’s first affidavit at [7]; Ms Miraki’s affidavit at [9]). This is denied by the defendants (see Ms Doss’ first affidavit at [9]; [78]; Mr Mehmani’s affidavit at [9]; [72]). Each deposed that he or she had never set foot in the plaintiffs’ house (see Ms Doss’ first affidavit at [77]; Mr Mehmani’s affidavit at [71]).

13. Ms Doss was adamant in cross-examination that she was never on good terms with Mr Miraki and her cousin (T 227.33; 227.36); that she did not know Mr Miraki in Iran (i.e., before she came to Australia) (T 227.48); and that between 2003 and 2010 she never had conversations with Mr Miraki, never saw him, never spoke to him and never personally lent him money (T 228.3-228.25). Ms Doss denied that her husband and Mr Miraki were good friends and accused Mr Moshtael (someone described in the defendants’ affidavit evidence as a “family friend” and “friend” (see [32] below), who was called in the plaintiffs’ case and who gave evidence, amongst other things, of the close relationship between Mr Miraki and Mr Mehmani) of being a liar (T 228.30-228.46):

Q.    In fact they [Mr Mehmani and Mr Miraki] were such good friends that Mr Moshtael described them as being like offsiders or buddies that were always together.

A.    Mr Moshtael can say anything that he can made up but they never been the good friends.

Q.    He’s a liar is he?

A.    Who?

Q.    Mr Moshtael?

A.    Of course.

Q.    Is he?

A.    Yes.

Q.    He was your friends [sic] wasn’t he?

A.    He wasn’t my friend. He was Harry’s friend for a short time and after they just..(not transcribable)..they not friend anymore.

14. Similarly, in cross-examination Mr Mehmani distanced himself from any suggestion of friendship with either Mr Miraki or Mr Moshtael. In particular, he rejected the proposition that he was a friend of Mr Miraki or used to go out with him together or hang around a lot with him; saying that they had been colleagues and that they used to buy paint from Parramatta (T 243.1ff).

15. Pressed in cross-examination about contact with Mr Miraki over the years, there was the following exchange with Mr Mehmani (T 254.28-254.34):

Q.    But you’ve had contact with him over the years haven’t you?

A.    Look, even he didn’t know we are buying the house okay. My brother in law has bringing everything up and that’s why we separate, okay. This is just, you know, kind of jealousy and family problems.

…

A.   He didn’t know even my address.

16. Pausing here, the first statement extracted above is unintelligible insofar as Mr Mehmani’s answer seemed to divert from a denial of contact with Mr Miraki to issues with his brother-in-law and marital problems; and the last statement extracted above appears inconsistent with the evidence given by Mr Mehmani as to threats made by Mr Miraki in relation to the property and the basis on which the apprehended violence order was made – which clearly suggest that Mr Miraki knew Mr Mehmani’s address at least at some point – see [68]-[70] below.

Mr Mehmani’s work as a contract painter

17. Mr Miraki’s evidence is that, from 2002 to 2005, he and Mr Miraki worked together intermittently as contract painters (see Mr Miraki’s first affidavit at [8]). The defendants gave evidence that that Mr Mehmani worked with Mr Miraki for a much shorter time, being about two months in 2003 (Ms Doss’ first affidavit at [73]; Mr Mehmani’s affidavit at [69]).

18. At some stage prior to 2008 (which was when the company went into liquidation), Mr Mehmani set up his own business (Atlas Building Maintenance Pty Ltd). He says this was after a dispute with Mr Miraki over payment in relation to a particular job on a building site in Campbelltown where Mr Miraki was doing some contract work for a company called Rapid Constructions (as to Mr Mehmani’s evidence about that dispute, see Mr Mehmani’s affidavit at [13], [15], [17] and [18], all read subject to relevance, and [20], again read subject to relevance and as an assertion, subject to weight, in relation to the statement that Mr Mehmani’s business had been operating profitably).

19. As to Mr Mehmani’s evidence about Rapid Constructions, Mr Miraki (in his second affidavit affirmed 4 October 2017 at [5]-[6]) recalls that in or around 2003 he carried out subcontracted painting work with a company known as Rapid Constructions and that he subcontracted some of that work to Mr Mehmani but says that at some time after the work commenced Mr Mehmani (not to his then knowledge) commenced dealing with Rapid Constructions directly. He denies that he ever refused to pay Mr Mehmani for work relating to Rapid Constructions. Mr Miraki further deposes that he was not happy that Mr Mehmani decided to deal with Rapid Constructions directly (since that meant he obtained no benefit from sourcing the work).

Alleged joint investment in the purchase and sale of used cars

20. Mr Miraki gave evidence (see his first affidavit at [9]) that between 2002 and 2005 he and the defendants would invest together in purchasing used and/or damaged cars, repairing them and on-selling them for profit. He says that generally he would provide payment in cash to the defendants for his share of the purchase price for the vehicle, the vehicle would be registered in the name of one or other of the defendants, he would provide a further payment towards the costs of repairing the vehicle, and the vehicle would then be sold and he would recoup his contributions plus a share of the profits in line with the contributions made. He says that the funds were generally funds of his wife and that she is the account holder in the family and all accounts are in her name (see Mr Miraki’s first affidavit at [10]).

21. Pausing here, Mr Miraki deposes that it is customary in Iranian culture for the husband to enter into investments, albeit with the wife’s knowledge and consent. Ms Miraki gave evidence to the same effect regarding this aspect of Iranian culture – see [12] of her affidavit. In the statement of claim there is also an allegation that “[c]onsistently with Iranian custom”, the alleged agreement was wholly oral (see [10] of the statement of claim filed 27 February 2017). The defendants broadly deny the existence of the Iranian culture to which the plaintiffs depose (see Ms Doss at [76] of her first affidavit; Mr Mehmani at [70]) (and similarly they deny the allegation made in the pleading that, consistently with Iranian custom, the agreement was wholly oral: see [10] of the defence filed in court on 31 March 2017). The defendants in turn also invoked Iranian culture (in support of their argument that no funds were advanced to Ms Doss) insofar as it was put to Mr Miraki in cross-examination that it would generally be inappropriate for a man to call upon a married woman without the husband being present (see T 83.48) and in Mr Mehmani’s evidence that Ms Doss did not visit the Kellyville property during the renovations while Mr Moshtael was there (T 258.23-258.26).

22. Suffice it for present purposes to note that there was no expert evidence adduced from any anthropologist or sociologist as to Iranian culture or custom in any respect and hence I treat both sides’ accounts of that culture or custom as having no more weight than as statements of their respective undertakings of that culture (in effect, as assertions).

23. Returning to the allegation that Mr Miraki and the defendants engaged in joint investments in motor vehicles, Ms Doss denies that she or her husband had any involvement with Mr Miraki in selling or purchasing cars (Ms Doss’ first affidavit at [80]). This is also denied by Mr Mehmani (see his affidavit at [74]). There was evidence of, and Ms Doss was questioned in cross-examination about, a succession of car purchases and sales in a relatively short period of time (see T 209-221). However, this was in the period from 2009-2011, not in the period (2002-2005) during which the plaintiffs depose to joint investments in cars for resale. Ms Doss, having initially denied (at T 216.11) that she bought and sold a lot of cars (“No, I never”) qualified that answer by saying “Well, we always buy brand new cars” (T 216.14). Her explanation for the turnover in vehicles in 2010/2011 is not directly relevant to the present dispute (other than insofar as Ms Doss explains one of the deposits in her Commonwealth Bank account as referable to the sale of a particular vehicle – to which I refer in due course – and insofar as the plaintiffs point to the acquisition and sale of vehicles in this period as an illustration of what was submitted in the context of the Iranian bank account withdrawals, being that there were “unexplained” sums of money “floating around” – T 273.50 – see at [224] below).

Alleged demand by Mr Miraki for money in 2005

24. Mr Mehmani has deposed (in paragraphs of his affidavit that were read subject to relevance) to a sequence of events in 2005 in which he says: that Mr Miraki requested money from him (in the sum of $25,000), threatening to sell his (Mr Mehmani’s) home without him knowing and then suggesting that Mr Mehmani refinance his home for the purpose of paying Mr Miraki; that he and his wife paid Mr Miraki $22,000; that he regularly asked for the money back and Mr Miraki said words to the effect that he did not have it or would pay him later; that Mr Mehmani threatened to take legal action and that after this Mr Miraki presented him with a cheque dated 1 October 2005 for $15,000 but asked him not to bank it “just yet”, and then threatened, if Mr Mehmani tried to sue him or to present the cheque, to “send my people over”, saying he had “connections in the union” and would send them to Mr Mehmani’s job sites (see Mr Mehmani’s affidavit at [21]-[28]).

25. I note that nowhere does Mr Mehmani explain how it is that he thought, assuming he took the threat seriously, that Mr Miraki could make good his threat to sell Mr Mehmani’s home without Mr Mehmani knowing; nor is there any evidence as to in whose names the home then occupied by the defendants was registered – this being before the acquisition of the Kellyville property and before the acquisition and sale of a property at Winston Hills. Further, this evidence is inconsistent with Mr Mehmani’s denial that he had any contact with Mr Mehmani in the period between 2003 and 2007 or that Mr Miraki knew where he was living – see [15] above; [68] below.

26. Ms Doss (at [19] of her first affidavit) gives evidence as to sums totalling $22,000 being paid to Mr Miraki; and (at [23]) to having a copy of the cheque for $15,000 to which her husband had referred. A copy of a cheque dated 1 October 2005 drawn in the business name “Cool Painting Services” in the sum of $15,000 and made payable to Mr Mehmani (in his former Iranian name) was in evidence (Exhibit 2, p 252).

27. In respect of this allegation, Mr Miraki denies that he ever demanded the sum of $25,000 from the defendants; denies that the discussions deposed to by the defendants in relation to this issue took place; and denies receipt of the sum of $22,000 from either of the defendants (see Mr Miraki’s second affidavit at [7]). He says that he recalls giving a cheque for the sum of $15,000 to Mr Mehmani but his recollection is that Mr Mehmani had asked him for a loan and that he drew the cheque but then Mr Mehmani collected the funds from him in cash and he (Mr Miraki) never came around to collecting the cheque from Mr Mehmani (see Mr Miraki’s second affidavit at [8]).

Purchase and sale by defendants of property in Winston Hills

28. Ms Doss’ evidence is that in about December 2007 she and her husband purchased a house in Winston Hills, which they renovated and sold in about June 2008 (see her first affidavit at [24]). There was no evidence as to the source of the funds for this purchase. Its relevance is moot in circumstances where, (although the later purchase of the Kellyville property is said to have been at a time when the defendants were in financial difficulties and funds received from an earlier property sale might have been relevant to this), there were intervening events – such as Mr Mehmani’s bankruptcy – that are likely to have been more relevant when assessing Ms Doss’ ability to fund the purchase of a house in 2010.

Purchase of Ms Doss’ ute by Mr Miraki

29. The defendants each gave evidence Mr Mehmani bought a new Toyota Land Cruiser in about November-December 2007 for Ms Doss to replace her Holden Rodeo ute (see Mr Mehmani’s affidavit at [29]ff; Ms Doss’ first affidavit at [25]). According to Mr Mehmani, Mr Miraki asked Mr Mehmani to sell the ute to him and collected the ute from Mr Mehmani’s house but did not pay the monthly instalments owing on the ute to the financier (see Mr Mehmani’s affidavit at [29]-[30], read subject to relevance). Mr Miraki admits that he purchased a Holden Rodeo ute from Mr Mehmani in or around 2007; does not recall the amount that was paid but says his recollection is that Mr Mehmani was paid in full; and says he was not aware at the time of purchasing the vehicle that there was finance owing (see Mr Miraki’s second affidavit at [9]). (Again, the evidence of the defendants on this issue is inconsistent, at least to that extent, with Mr Mehmani’s denial of contact with Mr Miraki in the period 2003 to 2007 – see above at [15]).

Alleged request for funds by defendants in 2008

30. Ms Miraki has deposed that, in or around 2008, the defendants (along with their twin children) visited her and her husband and asked her husband for money to fund the heart surgery of Mr Mehmani’s mother in Iran; and she says that her husband gave $10,000 to the defendants (see Ms Miraki’s affidavit at [13]-[15]). Both Mr Mehmani and Ms Doss deny that there was any such conversation; deny that Mr Mehmani’s mother needed heart surgery and deny the receipt of the sum of $10,000 (see Mr Mehmani ‘s affidavit at [33]; Ms Doss’ first affidavit at [81]).

31. Pausing here, the evidence in relation to the birth of the defendants’ children, as given by Ms Doss in cross-examination, was that her twins were born in November 2008 and they were born in Iran not in Australia (see T 194.41-44); and, as I understand her evidence, the couple already had one child when the twins were born (see T 194.35-38). If so, Ms Miraki’s recollection that the twins were with the defendants when the defendants visited on the occasion referred to in her affidavit at [13] (assuming such a visit did take place) cannot be correct.

Defendants’ return to Iran and sale of Toyota Land Cruiser

32. Ms Doss deposes that on about 5 September 2008 she and her husband returned to Iran, intending to be there for an “undecided” time (see her first affidavit at [28]). Both she and Mr Mehmani give evidence (see [34]-[37] of Mr Mehmani’s affidavit; [28] of Ms Doss’ first affidavit) as to an arrangement made in September 2008 with Mr Moshtael (described by Ms Doss as “our family friend” and by Mr Mehmani as “my friend”) for him to sell Ms Doss’ Toyota Land Cruiser on their behalf. Ms Doss says that Mr Moshtael drove the couple to the airport on the day of their flight to Iran in the Land Cruiser. Mr Mehmani says that on their return from Iran (see below as to the time of their return) he asked Mr Moshtael about the car and was told that Mr Miraki had taken “it” from him (it is unclear whether “it” here means Land Cruiser or the money from its sale) (Mr Mehmani’s affidavit at [35]). Mr Mehmani says he spoke to Mr Miraki, who told him that he, Mr Miraki, had sold the car for $50,000 and made “good money out of the car”. Mr Mehmani says that he has not received any payment from the sale of the car. Ms Doss gives similar evidence (see [28] of her first affidavit) as to the lack of any payment for the Land Cruiser.

33. Mr Miraki admits that he purchased a Land Cruiser from Mr Mehmani in or about 2008 (see [11] of his second affidavit). He does not recall the amount that was paid but his recollection is that the purchase price was reduced in return for him forgiving earlier loans provided to Mr Mehmani.

34. Mr Martin Moshtael (formerly known as Mostafa Moshtael) gave evidence in the plaintiffs’ case. He recalls (see [23] of his affidavit affirmed 12 March 2018, which was read subject to relevance) dropping Mr Mehmani off at the airport but denies that Mr Mehmani instructed him to sell a Toyota Land Cruiser for him (see also the evidence given at T 111). According to Mr Moshtael, his recollection is that Mr Mehmani asked him to hand over the keys to the car to Mr Miraki. In cross-examination he said that he did so by leaving the keys on the tyre of the vehicle:

Q.   And it is the case that you handed the keys over to Mr Miraki because Mr Miraki asked you to give him the keys.

A.    No, he asked me because he said I owe the money. I have to pay the money to Miraki, Mr Miraki. I don't know what's going on. “Just go and give the key to him and leave the car to him.” That’s why I leave the car on the side of the road. I put the key there and then he - Mr Miraki take the key.

Q.    Where did you leave the key?

A.    On the - the side of the road because I don’t want to involve anything because the car - and then he left the country. I find it. The car doesn’t have the ownership paper. He’s bankrupt. I didn’t know anything about - I thought he was--

Q.    So you left the key in the ignition.

A.    No, no, no, on top of the tyre.

Q.    On the top of the tyre.

A. Yes. [T 111.28ff)

Defendants’ return from Iran

35. As noted above, the defendants went to Iran in about September 2008. Ms Doss’ evidence is that her husband went to Iran in about late May 2008; that she and their son joined him in Iran on 17 July 2008; that the three returned to Australia and then went back to Iran in about late September 2008 (see her first affidavit at [74]). Ms Doss’ evidence is that Mr Mehmani then returned to Australia in about late December 2008 or early 2009 and that she returned with their (by then) three children on 27 March 2009 ([74]). It is clear that Ms Doss must have returned by at least June 2009 as she gave evidence that she had helped her brother to acquire a particular car (that was registered in her name) after her return from Iran and the date of that sale appears to have been 5 June 2009 (see T 210.49). Mr Mehmani’s evidence initially was that he returned from Iran in late 2009 but he then accepted that he was made bankrupt after his return from Iran (and the date of his bankruptcy was in July 2009), so he must have returned by at least July 2009 – and it is consistent with Mr Moshtael’s evidence that Mr Mehmani lived with him for a time on his return from Iran that Mr Mehmani returned earlier than Ms Doss did.

Mr Mehmani’s bankruptcy

36. As adverted to above, on 27 July 2009, Mr Mehmani was made bankrupt. In cross-examination he agreed that he had declared himself bankrupt (T 246.6). His evidence in cross-examination was that his bankruptcy followed the winding up in December 2008 of a company of which he was a director (Atlas Building Maintenance Pty Ltd). He said that the company was “wound down” in 2008 because he was “stuck in Iran” (T 245.2-245.5). He stated that while he was in Iran someone had put “something like” $50,000 worth of paint on his account (with a paint supplier) and that he could not pay the bills (referring in this context to “dodgy stuffs” that had been done) (see T 245.39). Mr Mehmani said that he came back to Australia (in late 2009) and declared himself bankrupt because “when [he] was in Iran everything was messed up” (T 246.12). He did not remember to whom he owed money or how much he owed. He also said that in around March or April 2010 he and his wife opened another company under his wife’s name, ABM Painting Services (and he acknowledged that as a bankrupt he could not be a director of that company).

Defendants’ separation

37. The defendants separated at some stage for a time (Mr Mehmani said this was in 2014 (T 248.5) but it may be that this was sometime earlier, having regard to Ms Doss’ evidence in the witness box that she was separated for a short period and appearing to put this as being in the period around 2011/2012– see below at [39]). Indeed, as I understood Mr Mehmani’s evidence in the witness box, he and his wife were again separated as at the time of the hearing (see T 248.5) though nothing turns on this. What is relevant, however, is Mr Mehmani’s evidence that in December 2010 (when the Kellyville property was acquired) the couple were living together as a family (T 248.21).

38. I note in passing that the issue of the couple’s marital problems is one instance where Mr Mehmani’s evidence conflicted with what was recorded in contemporaneous documents – in that Mr Mehmani was taken in cross-examination to a report made by his bankruptcy trustee to creditors in August 2009 in which it was reported that in Mr Mehmani’s statement of affairs Mr Mehmani had listed, as one of the main causes of insolvency, “domestic discord or relationship breakdown”. In the witness box, Mr Mehmani denied having told his bankruptcy trustee that one of the reasons for his insolvency was relationship problems. (As adverted to above at [15], when answering questions in a different context – that of his contact with Mr Miraki – Mr Mehmani attributed the breakdown of his relationship at that time to jealousy on the part of his brother-in-law.)

Evidence of Centrelink payments to Ms Doss

39. There was evidence that, at least from around July 2010 to October 2010, Ms Doss was receiving fortnightly Centrelink “parenting payments” (paid into a St George account used apparently only for that purpose) of more than $440 (which the plaintiffs suggest meant that her income was not more than $62 per fortnight for that period). (I note that the statements of the St George account in question – Exhibit B – indicate that as at October 2010, the parenting payments were $285.16 per fortnight.) There was also some evidence that there had been an overpayment of moneys from Centrelink which had been required to be repaid (see Ms Doss’ cross-examination at T 207.14). Ms Doss accepted that she continued to receive parenting payments in 2011 and 2012 “[f]or short period of time, yeah, I was separated” (T 207.2) (which Exhibit B confirms) but denied she received the payments for the whole of that period.

Purchase of the Kellyville property

40. In terms of the chronology, this brings me to the events of 2010 in relation to the acquisition of the Kellyville property. I will set out in due course the alleged oral agreement as pleaded (see [73] below). At this stage, I summarise the varying accounts set out in the parties’ affidavits of what happened in relation to the purchase.

Mr Miraki

41. Mr Miraki’s account of events (see [15]ff of his first affidavit) is that, in or about early 2010, the defendants came over to his house at West Pennant Hills; that he and his wife were at home at the time; and that there was a discussion in which Ms Doss and Mr Mehmani said that they wanted to invest in property and Mr Mehmani said:

We can invest in property. We can find a house that needs a lot of work, renovate it and then sell it for a profit. We work in the construction industry, so we would be able to renovate at a cheaper cost than others.

42. Mr Miraki says that he said he would think about it; that he discussed it with his wife; and that there was a further discussion in about late April 2010 at his home with the four of them in which Ms Doss said they had been looking at properties around Kellyville; that the prices for an old home were around $600,000 and that she and Mr Mehmani were thinking “if we can buy a house as we discussed, we will live there instead of renting and when we sell, we can share the profits”.

43. Mr Miraki says he agreed that the plaintiffs would start giving Ms Doss money so she could show the bank she had the money for a 20% deposit and the stamp duty; and that he told Ms Doss that whatever he gave her to buy the property and for the renovation would be his share and that the profit would be split (after he got back his contribution) according to their respective proportions. He says that he then gave her $10,000 in cash that he had in the safe and said he would give her the money in stages “until we are ready to buy” (see [18] of his first affidavit).

44. He then deposes to further payments (withdrawn from his wife’s Commonwealth Bank credit card account) in cash of: $30,000 on or about 30 April 2010; $30,000 in May 2010; $24,000 in June 2010; $65,000 in August 2010; and $49,500 in September 2010 (totalling $198,500). He says that he provided the cash sums to Ms Doss and did not deal with Mr Mehmani (as his wife was more comfortable with him dealing with Ms Doss) (see [20]-[22]).

45. Mr Miraki says that in about early October 2010 he had a further conversation with the defendants in which Ms Doss acknowledged that he had given them just under $210,000; that they had spoken with their broker “and we should have no problem getting a loan”; and she asked him to check out a property they had found at Kellyville (see [23] of his affidavit). Mr Miraki says that he and Mr Mehmani inspected the house (see [24]). He says he recalled that he thought the house was “exactly what we were looking for” as it was in poor condition and needed a lot of repairs.

46. Mr Miraki does not recall whether the property “was for sale or auction” but recalls that the purchase price was $610,000 (see [25]).

47. Mr Miraki then gives evidence as to a discussion with Ms Doss in relation to how much they needed to borrow (see [26]) and deposes that he made further payments to her from October 2010 to 13 December 2010: $25,000 in October 2010; $68,500 in November 2010 and $23,000 before settlement in mid-December 2010 (see [28]). He says he made another $25,000 payment in late December 2010 (after settlement, when Ms Doss told him she had not taken into account the stamp duty) (see [29]; [30]).

48. Mr Miraki’s evidence is that the settlement of the property took place in mid-December 2010 and that the defendants and their children moved into the property in about January 2011. He deposes to a conversation with the defendants as to the renovations ([32]), saying that he and Mr Mehmani arrived at a figure of $150,000 for the renovation costs ([34]); and that in about late January 2011 Ms Doss asked if he would be able to pay the costs of the renovations up front as that would help them with the mortgage ([35]).

49. Mr Miraki deposes that (in or about February 2011) he received $130,000 in cash from a third party (his now deceased former lawyer, Mr Szekely) and that he gave that to Ms Doss to deposit ([38]); and that he withdrew a further $15,000 from the Commonwealth Bank credit card account on 30 March 2011 and gave those funds to Ms Doss ([41]).

50. Mr Miraki says that renovation works took place throughout 2011 ([42]) and that he had limited involvement in dealing with the renovations ([43]). He deposes that in about November 2011 he had a conversation with the defendants in which Mr Mehmani said the money for the renovations had been used up and the cost was going to be probably another $50,000 to $60,000 ([44]). He says that after that he paid $15,000 from his wife’s ANZ bank savings account on 18 November 2011 ([45]); that he paid $30,000 in late December 2011 (that he had borrowed from a friend, Adam Burgess) ([47]) and another $10,000 in about January 2012 (see [48]-[49]).

51. In cross-examination, Mr Miraki gave an account of how the sums were paid to Ms Doss. He made clear that the moneys were not transferred electronically to Ms Doss’ account but were withdrawn in cash. There was the following exchange in cross-examination (T 71.4-71.24):

Q.   … Why wouldn’t you transfer the funds electronically?

A.    Why we did not transfer it?

Q.    Correct.

A.    Do you need an explanation why we did it this way? Is that how you’re asking? Is that your question?

Q.    I’m asking you why are these funds withdrawn in cash instead of just simply transferring it electronically.

A.    Okay. The conversation agreement we had was if we put loan from business account to her - because she doesn’t work for us - if we transfer money to them, the bank is going to say, “Where do you work? What’s the story with this money?” and all that. So they had to have proof of saving before they get the loan, and the second reason for that was I was advised by the bank manager at the time, “If you would like to get bigger credit limit with your car and your accounts all that, like an overdraft or whatever facility, you got to put on a lot of transaction, larger and larger, so the bank see the ability of paying and all that sort of” – that’s how we did it so - and - and on top of that, the money was given to them in cash and I believe she did deposit the cash into her account. You can see that.

52. Mr Miraki was cross-examined as to the manner in which the cash was given to Ms Doss. It was put to him that he had not just turned up unannounced at Ms Doss’ then residence in order to give her money; and that he had not made any attempt to explain how he contacted Ms Doss or where he met her in order to give her money. He said (T 85.6-85.15):

A.    We always spoke. We always basically met up and they collect the cash from me. That did happen.

Q.    I would like you to answer my question. In your affidavit, your first affidavit, and your second affidavit--

A.    Yeah.

Q.    You have made no attempt to explain how you contacted Ms Doss.

A.    How should I contact her? You call people on the phone or you go there. That’s--

53. As to where he met Ms Doss to hand over the money, Mr Miraki said “Well, most the time they used to turn up and pick up the cash next to the bank in Cherrybrook and, yeah, okay” (T 85.35-85.36). Mr Miraki was then asked (T85.43-85.48):

Q.    And in fact you have not identified how you contacted Harry Mehmani to provide him with money.

A.    Kind of you call someone, “Can I have money?” “Come over here”.

Q.    But you don’t say that in any of your affidavits.

A.    Sorry, I haven’t said it but I have given them the money.

54. As to the absence of detail on these matters from his affidavits, Mr Miraki said “Sorry, look, I’m a very simple person” (T 86.5). He nevertheless was adamant in rejecting the suggestion that he had never given one cent to Ms Doss or Mr Mehmani and the suggestion that he never contacted them to give them any money, saying “I did give them the money” and “We always spoke. We always met and they always received the money … Every time we withdraw the money, I have passed it to them. They got it from me” (T 86.9-86.16).

55. As to the proposition that it was inappropriate in the Iranian culture for him to have attended upon a married woman in the absence of her husband and given her significant moneys, Mr Miraki’s response (in the absence of his wife from the court room at his request) was (T 83.41-84.34):

Q.     My question to you is it would be inappropriate.

A.    Sure.

Q.    Because you say that you have attended upon Ms Doss and given her significant moneys.

A.    Yes, I have done it.

Q.    And I want to suggest to you that it would be inappropriate for you to attend upon Ms Doss without Mr Mehmani’s knowledge.

A.    I don’t know if I should talk about this or not. I don’t think it’s appropriate to bring this up. I know Helen from a long time ago before she gets married and there is a long history. We don’t want to bring it up in court or in the affidavit. I don’t think it’s right to talk about it but I have - this goes back to my..(not transcribable)..back then and--

…

A.    Well, we are not going to do anything wrong. We’re just doing some business dealing there and everyone are aware of this. My wife knew what we’re doing at the time. She was informed and the husband and - me and Harry are very good friends, become very good friends when they came here. They were in our wedding and I knew Helen and her family from when I was a little boy and there is a lot going on from back then till - but I don’t want to go through the history but all I can say is she - when I got married to my wife, I realised she - Helen or Mariam [sic] - she changed her name to Helen after - is my wife’s first cousin. That’s how, you know - yeah--

56. As to the first of the two instances in which Mr Miraki said that he advanced moneys obtained from third parties – the loan from the late Mr Szekely – the only evidence came from Mr Miraki (who became emotional in the witness box when speaking about his late friend and lawyer). Mr Miraki said there was nothing in writing as to this loan but that he had attempted to contact the estate of Mr Szekeley in relation to the moneys in question (T 76.5-76.50):

Q.    And there was no written agreement between him or you?

A.    Unfortunately, the guy passed away from cancer in 2015. And we tried to contact his family a number of time, but we've been unsuccessful, and I really would like this matter to go back to him, or his - like, his son and his wife. I tried in Facebook, your Honour. This - or find some information about his son, but - or his family, but I wasn’t successful. I really missed him. He was a nice guy.

Q.    What - why were you making contact, sorry? Can you clarify what - when were you making contact?

A.    The one - the $130,000 belonged to that person, and the money should go back to him.

…

Q.    Yes. There was no written record.

A.    Between me and William?

Q.    ..(not transcribable)..

A.    Such a nice guy he was. He was my solicitor for a long time, and the level of trust and friendship was right there, didn’t have to write things or do things like that.

Q.    So the answer to--

A.    Same as - same as what I had with Helen and Harry. I mean, the friendship and the respect was there.

…

Q.    Is it the case there was no written record.

A.    No. No, no, no. No, between me and William. Never.

57. As to the second of those instances, evidence was called in the plaintiffs’ case from Mr Burgess. He was cross-examined. He deposes to a discussion in around late 2011 in which Mr Miraki asked if he could borrow $30,000 “for the Kellyville property investment I’m in”; and that he, Mr Burgess, withdrew $30,000 from his bank account on 23 December 2011 and gave it to Mr Miraki (see [4]-[6] of his affidavit affirmed 12 March 2018). He says that within a month of giving that money to Mr Miraki, he went for a drive with him one night to the property and Mr Miraki told him that was the property he was investing in ([7]); and that, after a number of requests for payment, in about early 2013 Mr Miraki repaid him the $30,000 in cash ([9]-[10]).

Ms Miraki

58. Ms Miraki gives a similar account to Mr Miraki’s of the conversation in early 2010 at her home with the defendants in relation to the proposal to invest in property (see her affidavit at [17]-[18]) and to the discussion a few months later (see [20]).

59. Ms Miraki has deposed that she was never made aware, nor was she ever interested in knowing, the details of the payments and the investment or of the details of the expenditure (see [22]-[24]) but says she was aware that the investment property was to be renovated. She deposes in general terms to discussions with her husband about withdrawals from her Commonwealth Bank account from which she says she was aware that the withdrawals were to contribute to the property; and deposes to awareness of withdrawals from her ANZ bank account to contribute to renovations.

Ms Doss

60. Ms Doss’ evidence is that she and her husband never discussed their financial affairs with the plaintiffs (see [30] of her first affidavit). Her account is that she and her husband viewed the property in Kellyville in 2010 ([31]); that they visited the property on 30 October 2010 and placed a cash deposit on it in the sum of $1,525 the following day and settled the purchase of the property in December 2010 ([32]). She believes that she exchanged contracts with the vendors “most likely” on 31 October 2010 ([33]).

61. Ms Doss instructed solicitors to act on the purchase on about 8 November 2010 ([34]); she applied for finance from Bank of Western Australia Ltd (BankWest) in November 2010 to borrow $488,000 ([40]), signing a loan contract on 12 November 2010 ([40]); she caused a cheque to be made out in the sum of $87,203.34 on about 9 December 2010 ([38]); and the balance owing on settlement was funded from the finance obtained from BankWest ([38]). Ms Doss gives evidence of the renovations (at [42]) including as to payments made in relation to the renovations.

62. Ms Doss deposes that she personally repaid the monthly instalments due to BankWest and says that no monthly instalments were paid from any funds from the plaintiffs ([41]). She deposes that she and her husband did not seek any funding from the plaintiffs for any costs or renovations; did not discuss any renovations with the plaintiffs; and did not receive any moneys from the plaintiffs to complete the renovations ([47]).

63. Ms Doss denies any discussion with Mr Miraki regarding the purchase of the property ([49]); denies attending the Ardestani residence ([50]) on the occasions alleged in early 2010 and denies the discussions and words attributed to her and her husband in the plaintiffs’ affidavits ([51]). She denies making any request for money; ever receiving any money from the plaintiffs for any purpose; and denies any discussion in relation to an investment at any time ([53]; see also [55]). In particular, she denies receiving any of the sums referred to in Mr Miraki’s affidavit ([69]). She also denies any agreement between herself and Mr Miraki in relation to the purchase of the property ([82]).

Mr Mehmani

64. Mr Mehmani’s account of events in relation to the purchase is similar to that of his wife (see his affidavit at [38]ff). In particular, he denies receipt of any moneys from the first and second defendant ([sic], presumably he means the first and second plaintiff) to complete renovations ([50]); denies any discussion with the plaintiffs as to the renovations or as to the purchase ([51]); denies attending the residence of the plaintiffs on the occasions alleged in early 2010 ([52]) and says he has never set foot in the house of the plaintiffs ([71]); denies any discussion in relation to investment in the property or requesting moneys for investment purposes or receipt of any moneys from the plaintiffs (see [53]-[56]; [65]-[66]; [68]); and says he never discussed his financial circumstances “let alone any financial difficulties at any time with Mr Miraki ([75]).

Late 2012

65. It is not disputed that whatever the nature of the relationship in the preceding period (Mr Miraki asserting that he and the defendants were good friends; the defendants adamantly denying that there was such a friendship), by late 2012 the relationship between the parties was not a positive one.

66. Mr Miraki says that the final stages of the renovations took a strain on his relationship with the defendants ([50] of his first affidavit); that in early 2012 he persisted in requests for a breakdown from the defendants regarding the payments he had made and where they were spent and often asked for copies of the loan accounts ([51]); that by mid to late 2012 the relationship had completely broken down and he was no longer on speaking terms with the defendants ([52]); and that this took a strain on his marriage and the dispute affected his wife’s relationship with her extended family.

67. Mr Miraki also says that he kept approaching the defendants requesting the property be sold or that they pay him his share ([53]). This is supported to some extent by the defendants’ evidence, at least to the extent that they give evidence of demands for money made by Mr Miraki (although I note that there is no evidence of demands being made for the specific monetary amounts now being claimed; rather, the evidence is that the claims were for far smaller sums – see [68] below).

68. Mr Mehmani deposes to having received text messages from Mr Miraki in about August-September 2012 demanding payment of money (in sums of $10,000 and $20,000) and to threats received in about September 2012 to burn his house down and “send the bikies over” if he did not pay him $20,000 or give him paint (Mr Mehmani’s affidavit at [57]; [58]), following which he and his wife contacted the police and an application was made for an apprehended violence order ([59]; [61]). Mr Mehmani also deposes to the making of a further threat by Mr Miraki ([62]) that he would make Mr Mehmani pay “one thousand times more than this” saying that “five hundred dollars is lunch money”.

69. Ms Doss also deposes to a threat made to her husband by Mr Miraki of burning their house down; and that she and Mr Mehmani approached the police and subsequently applied for and obtained an apprehended violence order against Mr Miraki (see [58]; [60] of her affidavit).

70. A final Apprehended Domestic Violence Order, naming Mr Mehmani as the protected person, was made in the Parramatta Local Court on 23 April 2013 restraining Mr Miraki for a period of 12 months from 11 December 2012 from, among other things, harassing or threatening Mr Mehmani or any person with whom the protected person has a domestic relationship. The orders also prohibited Mr Miraki from going within 200m of the Kellyville property and from approaching or contacting Mr Mehmani otherwise than through the latter’s legal representative (see Exhibit 2, pp 219-220). It appears that Mr Miraki did not contest the making of that order but, in cross-examination, he accused the defendants of going to the police and making things up (see T 86.38) because he was “chasing” them for repayment of his money.

Sale of Kellyville property

71. In about December 2014 the Kellyville property was sold. Ms Doss deposes that at about the same time, in December 2014, she sought to refinance the existing mortgage over the Kellyville property with the National Australia Bank (see her first affidavit at [63]). Ms Doss has deposed that before settlement of the Kellyville property she and her husband purchased a property at Beaumont Hills and that the purchase of this property was financed through NAB, as part of which she refinanced the BankWest mortgage over the Kellyville property ([64]). Ms Doss has deposed that settlement of the sale of the Kellyville property occurred sometime in either January or February 2015. The Kellyville property was sold, as noted earlier, for $905,000. The Beaumont Hills property was acquired for $925,000.

Pleadings

72. These proceedings were commenced by way of summons filed 5 December 2016, in which both interlocutory and final relief was sought. As to the final relief, various declarations were sought, including declarations as to: an express trust (according to the alleged arrangement in relation to the Kellyville property) to the extent of the plaintiffs’ alleged contributions to the purchase price and improvement of the said property; an equitable charge over the Beaumont Hills property; alternatively, a resulting trust (as to a 57.38% interest in the property and as to the extent of the alleged contributions to the improvement of that property); estoppel; breach of contract; and breach of trust or breach of fiduciary duty. Equitable compensation was also claimed.

73. The matter then proceeded by way of pleadings. In the statement of claim filed 27 February 2017, the alleged agreement was pleaded as follows (at [9]):

The Agreement – April 2010

9   In about late April 2010, the parties had a second meeting at the Plaintiffs’ house and the following agreement to invest in real property was made (Agreement):

a.   The Plaintiffs would contribute funds owned by Sepideh to the purchase price of a property in Kellyville for around $600,000;

b.   The property was to be bought in Helen’s name;

c.   The Defendants would renovate and live in the property rent-free for at least approximately 12 months, after which it would be sold;

d.    The Plaintiffs would further contribute funds owned by Sepideh to the cost of renovation;

e.   The total cost of the renovation would be agreed later;

f.   Upon sale, and from the proceeds of sale (Proceeds), the Defendants would repay all of the Plaintiffs’ contributions (to both the purchase price and the cost of renovation) to the Plaintiffs;

g.   Upon sale, and from the Proceeds, the Plaintiffs and the Defendants would split the net profit (net of all the Plaintiffs’ contributions and Defendants’ contributions) in proportion to the respective contributions of the Plaintiffs and the Defendants. [my emphasis]

74. It is alleged that “[c]onsistently with Iranian custom”, the agreement was wholly oral ([10]). (As noted above, this was denied by the defendants.)

75. It is further alleged that, at the second meeting (it is not clear from the pleading to what any ‘first’ meeting refers), “the 12-month term was discussed and agreed so as to avoid the Defendants becoming liable for capital gains tax” ([11]) and that the agreement was made on the basis that “the respective husbands would take an active role in the management of the investments” (there presumably referring to the acquisition of property, since no other investments are identified in the pleading) (see [12]).

76. It is alleged that at the meeting at which the agreement was made, the parties agreed that the plaintiffs would immediately commence providing funds from Ms Miraki’s bank account, which would “go towards [Ms Doss] obtaining a 20% deposit so that she would be able to obtain finance” ([15]) and that the plaintiffs immediately provided $10,000 in cash to the defendants “as the first instalment of the Plaintiffs’ contributions under the Agreement” ([16]).

77. The statement of claim then pleads a series of withdrawals by Mr Miraki in cash from his wife’s Commonwealth Bank credit card account from 30 April 2010 and then in May, June, August and September 2010 (see [17]-[21]) (being the two “instalments” of $30,000 each and “instalments” of $24,000, $65,000 and $49,500 respectively to which Mr Miraki deposes in his first affidavit) and that further funds were provided in the period October to December 2010 (of $25,000, $68,500, $23,000 and $25,000 respectively, again as deposed to in his first affidavit), again in cash drawn from the said account ([25]-[29]).

78. The pleading alleges that in around early October 2010 the defendants confirmed to Mr Miraki that the plaintiffs had provided almost $210,000 to Ms Doss “by way of contributions to the purchase price” and that Ms Doss “would now seek to obtain a bank loan” ([22]) and that at around the same time the defendants said that a particular Kellyville property (the subject property) “could be the right property for the Agreement” ([23]). It is alleged that, soon after, Mr Miraki inspected the property with Mr Mehmani and that Mr Miraki informed the defendants “that the Plaintiffs agreed that they were content with the Property being the subject of their investment agreement under the Agreement” ([24]).

79. Funds for the renovation of the Kellyville property are alleged to have been provided to the first defendant in February and March 2011: a sum of $130,000 in cash which had been provided by the late Mr Szekely ([36]-[38]) and a sum of $15,000 in cash drawn from the same Commonwealth Bank credit card account as the earlier sums ([40]). It is alleged that later in 2011 and early in 2012 Mr Miraki provided to the first defendant amounts drawn from Ms Miraki’s ANZ Savings Account (of $15,000 on around 18 November 2011 ([43]) and $10,000 on around 12 January 2012 ([48])); as well as an amount in December 2011 of $30,000 said to have been obtained by Mr Miraki as a loan from Mr Burgess.

80. Thus it is alleged that the plaintiffs contributed in total the sum of $200,000 to the cost of renovation of the property ([49]). It is alleged that, to the plaintiffs’ knowledge, the defendants contributed no funds to the cost of renovation of the property ([50]). The amounts allegedly contributed to the purchase of the property total $350,000. Thus the allegation is that the plaintiffs paid $550,000 to the defendants in relation to the Kellyville property over the relevant period. The plaintiffs allege that they were entitled to be reimbursed those funds and that they are entitled to a 67.9% share of the net profit (calculated on the basis of the original purchase price, the sale price of the Kellyville property in February 2015, and the total cost of the renovations) of $95,000 (i.e., $64,506.17) (see [57]-[58]).

81. It is alleged that the defendants failed to inform the plaintiffs that they had exchanged contracts in relation to the property or inform them as to the proposed sale of the property ([55]); failed to inform the plaintiffs of the settlement of the sale of the property before or after it occurred ([56]); failed to reimburse the funds of $550,000 that the plaintiffs had paid ([57]); and failed to pay to the plaintiffs their proportionate (67.9%) share of the net profit on the sale ([58]).

82. The relief claimed in the statement of claim includes: declarations that the alleged arrangement was agreed between the parties and as to the amounts owing pursuant to that agreement (see prayers 1 and 2); a declaration that the Beaumont Hills property was purchased with the proceeds of sale (prayer 3); a declaration that the defendants breached the agreement by the purchase of the Beaumont Hills property and the failure to pay to Ms Miraki any of the amounts owing under the agreement (prayer 4) and a claim for damages (prayer 5).

83. Further, a declaration is sought that Ms Doss holds the Beaumont Hills property on trust for Ms Miraki to the extent of $614,506.17 (the Amount) (prayer 6) or, in the alternative, that Ms Doss is the chargee of an equitable charge on the said property securing the payment of the Amount (prayer 7).

84. A declaration that the defendants have committed breaches of trust or breaches of fiduciary duty is sought by prayer 8.

85. In the alternative to prayer 5, equitable compensation or an account of profits is sought (prayer 9).

86. In the further alternative (it would seem, though this is not stated, in the further alternative to prayer 6) the plaintiffs seek a declaration that Ms Doss held the Kellyville property on resulting trust for Ms Miraki to the extent of her contribution to the purchase price (being $350,000 or 57.38%) (prayer 10); and, further to prayer 10, equitable contribution in respect of the plaintiffs’ $200,000 contribution to improvement of the property (prayer 11).

87. Prayer 12 is a further alternative claim for relief (seemingly again an alternative to the relief sought in prayer 6), being a claim for restitution of the sum of $550,000 paid by the plaintiffs to the defendants in respect of the agreement.

88. Interest is claimed on any of the amounts claimed, pursuant to s 100 of the Civil Procedure Act 2005 (NSW); as well as costs and interest on costs.

Evidence

89. For the plaintiffs, affidavits were read from the following witnesses: Mr Miraki, Ms Miraki, Mr Moshtael and Mr Burgess, each of whom was cross-examined; as well as from Mr Ali Norri (a former director of a company, A1 Best Air Conditioning Services Pty Ltd, to which reference had been made on Ms Doss’ BankWest loan application – a matter of relevance only insofar as it goes to her credit and dispels any suggestion of income during 2009/2010 from that source). Mr Norri was not cross-examined. His evidence, unchallenged, was that he had no recollection of a person by the name of Helen Doss or Maryam Mohammadi Aghdam ever being employed by A1 Best Air Conditioning Services Pty Ltd and that during his time as a director the company had engaged external accountants (relevant since the BankWest application stated Ms Doss’ occupation as that of accountant) (see [6] of Mr Norri’s affidavit sworn 16 April 2018).

90. For the defendants, affidavits were read from the following witnesses: Ms Doss, Mr Mehmani, and Mr Abedini (who gave evidence that he was formerly in the business of “acting as an intermediary to assist with customers transferring money from Iran to Australia” and deposed to certain dealings with Ms Doss in relation to the transfer of funds to her Commonwealth Bank account on five particular occasions from October through to December 2010). Objection was taken to the lateness of the evidence sought to be adduced from Mr Abedini and to its form and content. I rejected much of the contents of Mr Abedini’s affidavit but gave leave for the defendants to adduce evidence from him orally in chief in relation to various aspects of his affidavit evidence, provided a written outline of that evidence was served in advance of the hearing. Each of the defendants was cross-examined, as was Mr Abedini.

Evidence as to withdrawals/deposits

91. It is convenient at this stage to note the evidence adduced by the respective parties as to the various bank account withdrawals and deposits.

• Source of moneys said to have been paid to the defendants

92. In the statement of claim, fifteen payments in all are alleged to have been made to the defendants referable to the alleged agreement: the first nine prior to settlement of the purchase of the Kellyville property and the balance thereafter. Mr Miraki annexed to his first affidavit copies of various Commonwealth Bank Business Card statements for his wife’s credit card account for the period from 10 April 2010 to 5 January 2011 (Annexure A), a copy of page 3 of the statement for the same account for the period from 5 March 2011 to 4 April 2011 (Annexure B), a copy of page 1 of his wife’s ANZ savings account statement for the period from 29 September 2011 to 29 December 2011 (Annexure C), and a copy of page 1 of the statement for the same ANZ savings account for the period from 29 December 2011 to 29 March 2012 (Annexure D). Each of those statements shows withdrawals to which Mr Miraki refers in his affidavit as withdrawals of the sums which were then provided to the first defendant.

93. What is apparent from those statements is that there is not a precise correspondence between amounts withdrawn from Ms Miraki’s accounts and the sums said to have been advanced on particular dates. Further, it is apparent that on some days there were a number of separate transactions from different branches. As to this, Mr Miraki’s evidence in cross-examination was (T 67.30-67.35):

Q.    … Why is it you don’t take the moneys out in one hit?

A.    Okay. They don’t have money sitting there all the time and the large withdrawals, they tell you, sir, “You can get 20 from here. You can go to another branch, get 20, and then ten grand from another branch”. That’s how - how you do it or, “Come back in the afternoon and we’ll have more money for you”. That’s how we have done it.

94. In the table below, I have set out in the right hand column the alleged source of each of the payments alleged to have been made to the defendants referable to the alleged agreement, by reference to Mr Miraki’s evidence and to the copy bank account statements adduced in evidence.

Date	Amount	Comments
Late April 2010 (Mr Miraki’s first affidavit at [18])	$10,000	This is the sum allegedly provided in cash from the safe at the plaintiffs’ West Pennant Hills home when the agreement was struck in about late April 2010. Mr Miraki said that this money came from the bank account of a company called Finish Corp (T 59.36).
30 April 2010 (Mr Miraki’s first affidavit at [20])	$30,000	This amount corresponds with the 30 April 2010 withdrawal from CBA Cherrybrook in the sum of $30,000 (Annexure A p 14; see T 60.8-60.25).
May 2010 (Mr Miraki’s first affidavit at [21])	$30,000	This amount corresponds with the 4 May 2010 withdrawal from CBA Cherrybrook in the sum of $30,000 (Annexure A p 14; see T 61.14).
June 2010 (Mr Miraki’s first affidavit at [21])	$24,000	According to Mr Miraki (T 63.47-63.50), this amount was comprised of funds withdrawn in three separate transactions: on 11 June 2010 from CBA Cherrybrook in the sum of $10,000 (Annexure A p 17); on 16 June 2010 from CBA Carlingford in the sum of $8,000 (Annexure A p 18); and on 28 June 2010 from CBA Haberfield in the sum of $6,000 (Annexure A p 19).
August 2010 (Mr Miraki’s first affidavit at [21])	$65,000	This corresponds with four separate withdrawals: on 2 August 2010 from CBA Castle Towers Castle Hill in the sum of $15,000 (Annexure A p 21); on 6 August 2010 from CBA Carlingford in the sum of $20,000; on 6 August 2010 from CBA Cherrybrook in the sum of $20,000; and again on 6 August 2010 from CBA Cherrybrook in the sum of $10,000 (all at Annexure A p 23). (See T 66.35-67.35; this being where Mr Miraki was asked why he did not make the withdrawals “in one hit”.)
September 2010 (Mr Miraki’s first affidavit at [21])	$49,500	This corresponds with another four withdrawals: on 6 September 2010 from CBA Castle Towers Castle Hill in the sum of $9,000 (Annexure A p 24); on 20 September 2010 from CBA Pennant Hills in the sum of $20,000 (Annexure A p 24); on 27 September 2010 from CBA Cherrybrook in the sum of $5,500 (Annexure A p 25); and on 29 September 2010 from CBA Cherrybrook in the sum of $15,000 (Annexure A p 25). (See T 68.32-69.27.)
October 2010 (Mr Miraki’s first affidavit at [28])	$25,000	This corresponds with two withdrawals: on 13 October 2010 from CBA Cherrybrook in the sum of $10,000 (Annexure A p 27); and on 25 October 2010 from CBA Cherrybrook in the sum of $15,000 (Annexure A p 28).
November 2010 (Mr Miraki’s first affidavit at [28])	$68,500	This corresponds with four withdrawals: on 10 November 2010 from CBA Cherrybrook in the sum of $13,500 (Annexure A p 29); on 23 November 2010 from CBA Cherrybrook in the sum of $25,000 (Annexure A p 30); on 29 November 2010 from CBA Cherrybrook in the sum of $16,000 (Annexure A p 30); and on 30 November 2010 from CBA Cherrybrook in the sum of $14,000 (Annexure A p 31).
Mid-December 2010 (Mr Miraki’s first affidavit at [28])	$23,000	This corresponds with two withdrawals: on 9 December 2010 from CBA Carlingford in the sum of $14,000 (Annexure A p 32); and on 13 December 2010 from CBA Cherrybrook in the sum of $9,000 (Annexure A p 33).
Late December 2010 (Mr Miraki’s first affidavit at [30])	$25,000	This corresponds with two withdrawals: on 21 December 2010 from CBA Carlingford in the sum of $15,000; and on 22 December 2010 from CBA Cherrybrook in the sum of $10,000 (both at Annexure A p 33).
February 2011 (Mr Miraki’s first affidavit at [38])	$130,000	This is the sum said to have been borrowed from Mr Szekely.
30 March 2011 (Mr Miraki’s first affidavit at [41])	$15,000	This corresponds with a withdrawal on 30 March 2011 from CBA Carlingford in the sum of $15,000 (Annexure B).
18 November 2011 (Mr Miraki’s first affidavit at [45])	$15,000	This corresponds with the total of two withdrawals made on 18 November 2011 from the ANZ savings account (in the sums of $5,000 and $10,000 withdrawn, respectively, at the Cherrybrook and Castle Hill branches) (Annexure C).
December 2011 (Mr Miraki’s first affidavit at [47])	$30,000	This is the amount said to have been borrowed from Mr Burgess.
12 January 2012 (Mr Miraki’s first affidavit at [49])	$10,000	This corresponds with a withdrawal of that amount from the ANZ savings account on that day (no branch is indicated on the statement) (Annexure D).
Total	$550,000

Deposits into Ms Doss’ Commonwealth Bank account

95. Exhibited to Ms Doss’ first affidavit (which exhibit was Exhibit 2 in the proceedings) were copies of Westpac and ANZ Bank accounts in the name of ABM Painting Services Pty Ltd and copies of various statements for a Commonwealth Bank account in Ms Doss’ name. As to the latter, Ms Doss’ evidence is that this account was used to fund the deposit payments and mortgage repayments to BankWest for the Kellyville property (see her second affidavit at [7]).

96. The Commonwealth Bank statement for the period 15 October 2010 to 8 December 2010 (Exhibit 2, p 199) records an opening balance of nil on 15 October 2010, followed by a deposit on 15 October 2010 of $22,500. This deposit is said by Ms Doss to represent the proceeds from the sale of a Toyota Land Cruiser (see her second affidavit at [8]), about which she was cross-examined (T 209.45-216.43) (the records produced by the RMS in relation to the vehicle showing, first, that no notice of disposal was lodged by Ms Doss in respect of it; and, second, that the number plates for the vehicle were returned on 2 November 2010, although Ms Doss suggested that this could be what happens when a vehicle becomes registered in another state).

97. Relevantly, there are five credit transactions that have been numbered (1-5) in handwriting on the copy of the 15/10/10 – 8/12/10 bank statement exhibited to Ms Doss’ first affidavit (Exhibit 2, pp 199-200), as follows:

08 Nov   CASH DEPOSIT (1)         $84,000

08 Nov LITTLE PARAND 2121 (2)      $30,000

08 Nov   CASH DEPOSIT (3)         $ 8,000

11 Nov CASH DEPOSIT (4)         $16,000

…

07 Dec Cash Dep Branch Chatswood (5)   $32,000

98. In cross-examination, Ms Doss accepted that those transactions were relevant (T 223.19) but had not been explained in her affidavit. She said that she had marked them:

Because exactly I remember these dates, we about to give money to the real estate for 10% deposit and I knew exactly these five transactions is from the purpose to buy the house, and those came from overseas. [T 223.14]

and that she had not sought in her affidavit to explain those transactions because she thought “8 November, it’s [sic] automatically proves it” (T 223.25). Each of those five transactions is said by Ms Doss to represent moneys sourced from Iran.

99. In all, however, Ms Doss identified in her second affidavit (at [15]) eight amounts as having been transferred from her husband’s bank account in Iran “via Mr Abedini” to her Commonwealth Bank account: those being the five numbered on the copy bank statement, as well as the following amounts: 20 December 2010 - $1,800; 28 February 2011 - $2,500; and 28 February 2011 - $8,000.

Ms Doss’ evidence as to the process of transfer of funds from Iran

100. Ms Doss deposed in her second affidavit that her husband has a bank account held with the bank called Pasargad in Iran and that she has access to that account electronically (see at [10]). Her evidence is that during the period 2011 to 2012 she arranged for funds to be transferred from that account to her Commonwealth Bank account ([10]), through an intermediary in Australia (Mr Abedini) ([11]) because there were sanctions in place at about that time in Iran which made it impossible simply to transfer the funds directly into her account.

101. Ms Doss annexed to her second affidavit copies of bank statements from the Pasargad bank account for the period 20 June 2010 to 18 December 2017, which she said she had printed from accessing her husband’s account electronically ([13]), and which she had caused to be translated into English using a function on the website ([14]) (see Annexure D). Ms Doss deposed at [13] that “all our savings in Iran” were in Iranian currency (rials) (my emphasis) – thereby seemingly suggesting that she regarded the money as representing joint savings (not moneys solely belonging to her and not moneys obtained from the sale of a wedding gift – see Mr Mehmani’s evidence to that effect – T 251.50; below at [193]).

102. Ms Doss’ account of the process adopted in arranging the transfer of funds from Iran (see [12] of her second affidavit) is that: first, she issued an authorisation by facsimile to the bank manager in Iran for her brother-in-law to collect a cheque for the sum that she wanted transferred; second, that when her brother-in-law collected that cheque he would deposit it in a bank account controlled by Mr Abedini’s agent in Iran and that agent would then transfer those funds to Mr Abedini’s bank account in Australia; and, third, when the funds arrived into Mr Abedini’s account in Australia he would advise her by telephone that the funds had arrived and she would request him to transfer those funds into her Commonwealth Bank account, which would occur by cash deposit or by funds transfer.

103. Taken in cross-examination to the translation of the Iranian bank account statement (ironically to Annexure D about which objection had been made to the admission into evidence and the tender of which was ultimately rejected – see T 239.4), Ms Doss said that: this account was opened when they were in Iran in 2009 (T 223.42), before her husband was made bankrupt in Australia (T 223.45); and that it was opened “[b]ecause we were in Iran and we need to have a bank account” (T 223.48). Entries in relation to 250 transactions (the “Last 250” according to the header to the printout) from that account, from 20 June 2010 through to December 2017, were recorded in Annexure D.

104. The two particular entries that Ms Doss had identified initially in her oral evidence in chief as transactions which were transfers from the Iranian account to Mr Abedini’s account were: transaction number 39 (a withdrawal of 1,409,000,000 rial; that Ms Doss accepted was in rough terms about A$133,000) (T 224.36-41); and transaction number 42 (a withdrawal of 996,060,080 rial) (which the plaintiffs’ counsel suggested was about A$96,000) (T 224.38).

105. Ms Doss accepted that there were a number of regular credits into the account (T 224.10-224.27); and that, before each of the withdrawals she had identified, there were one or more credit transactions (T 224.43-225.3; T 225.26). (In re-examination, Ms Doss said for the first time that those amounts represented interest from the deposit in the account – T 234.1.)

106. Ms Doss’ evidence in cross-examination was that she does not have any documents at all that were sent to the bank in Iran (T 226.16); she has no copies of the documents that she says were sent to her brother-in-law in Iran (T 226.20); and that “[w]e don’t do emails” (T 226.23). Ms Doss said that she had no emails from Mr Abedini for 2010 or 2011 (T 226.44) nor any other documents or receipts from him (T 226.46-50).

Mr Abedini’s evidence as to the transfer of funds from Iran

107. Mr Abedini’s evidence was given orally in chief (an outline of evidence having been served shortly before the hearing in the circumstances to which I adverted earlier) and before the evidence of the defendants, because of health reasons (T 139). Those health reasons related to a diabetic condition. The significance of this is that Ms Doss and Mr Mehmani were present in Court during his cross-examination and at least Mr Mehmani gave answers in cross-examination by reference to things Mr Abedini had been cross-examined about earlier that day.

108. Mr Abedini gave evidence that he retired in 2017; that he was involved in the money exchange business between 1998 and 2012 (under the business name “Karoon”) and that he had a Persian restaurant from 2007 to 2015 (T 140). His explanation in his oral evidence in chief as to the money exchange business he operated was (T 141.2-142.2):

A.    Money exchange business is the accepting money from here from the client and we pay them in our country, on country Iran to whatever they nominated. When, they, they gave the name, they gave the bank details to deposit to their account in Iran. The other side of the people. For example, some people want‑‑

HER HONOUR

Q.    So, sorry. You’re taking money in Australia‑‑

A.    Yes.

Q.    ‑‑in Australian dollars‑‑

A.    Mm-hmm.

Q.    ‑‑and you’re crediting some bank account in Iran?

A.    Iran, and I do the same from Iran. If somebody wants to bring money from Iran to Australia, we accepting money to their account in Iran and we gave them the money here. In their account, or sometimes they need the cash, you give them the cash.

…

MR RATNAM

Q.    And if you could just explain to her Honour, when you say, “Crediting into an account in Iran,” what do you mean by that? What is the process or arrangements?

A.    Okay. They bring money to be contracted with client, and they ask, they let us know if they are going to bring money from overseas. We agree with the rate, and we gave their details in our agent in Iran, and bank details in Iran. They deposit money to their account, and they let us, let me know. I check with the agent. If the deposit was okay, it's okay. We pay them here.

Q.    And can you just explain, when you say you pay them here‑‑

A.    Mm-hmm.

Q.    ‑‑I understand with the sanctions in Iran, a physical transaction from Iran cannot be transferred to an Australian‑‑

A.    No.

Q.    ‑‑account.

A.    Yes.

Q.    So, if a credit is made in an account in Iran‑‑

A.    Mm-hmm.

Q.    ‑‑how is it that you pay a customer or a client here in Australia?

A.    Yes. Normally we get the, we taking the money from the people wanted to send to overseas in Australian dollar, and we exchange it for the people that wants to bring from Iran to, oh, to Australia.

109. Mr Abedini explained that he had been registered with AUSTRAC from 2001 to 2012 and that he would be assessed for compliance by AUSTRAC every two to three years. In cross-examination, Mr Abedini was questioned as to his assessment by an assessment team from AUSTRAC on 14 November 2011 and the subsequent assessment report dated 22 December 2011 that he had received from AUSTRAC. Mr Abedini agreed that at that stage (i.e., late 2011) he carried on his business as a money exchanger through three entities (Karoon; Green Back International; and Silk and Green Gate (see Exhibit 5, p 3)); and that he had told the officers from AUSTRAC that he held separately managed bank accounts with the Commonwealth and the National Australia Bank purely for the purpose of handling remittance funds. He said that in 2010, however, he was only conducting business through Karoon (T 156.5). Asked about its business transactions, he said (T 156.10):

Q.    But you operated a separate account for Karoon’s business transactions?

A.    Not the separate. I used all of them for my client.

Q.    Well‑‑

A.    Whatever it was easy for them, they deposit.

Q.    No. I’m talking about your business.

A.    Yes.

Q.    You conducted a separate bank account for your business activities. Didn’t you?

A.     In 2011, yes.

Q.    Not in 2010?

A.    No. 2010 it was my personal account in..(not transcribable)..in Commonwealth, with the Commonwealth and National Bank in my personal. Nothing with the Commonwealth.

Q.    You told AUSTRAC that you’d been doing this business for a number of years.

A.    Yes.

Q.    But it was only in 2011 that you started operating a separate bank account. Is that right?

A.    Yes.

Q.    When did you open that account?

A.    2011. I think it’s early 2011.

110. He agreed that he told the AUSTRAC officers that he kept books of account, and that he had a notebook which recorded customer transactions; and an address book containing customer information. He did not recall that he had hard copies of customer identification records but said he did have “the handbook” (T 157.49). He said that he had not kept those documents (T 158.4):

Q.    Where are those documents now?

A.    It’s 8 years. I couldn’t keep this much long. It’s 2010. Now we’re in 2018.

Q.    Well one of the other things that they told you was that you were to keep those records for 7 years.

A.    7 years.

Q.    Yes.

A.    And it was 8 years.

Q.    So you threw them out when?

A.    I don’t know. Maybe last year.

Q.    Well when did you throw them out?

A.    Last year.

Q.    Yeah? Did you have them in March 2017?

A.    Yes. I did have it.

Q.    You had them in March 2017?

A.    Yes.

Q.    So they’re the documents you referred to. Is that right?

A.    Yes. Yes.

Q.    And even though you knew there was a court case, you decided to throw the documents out, did you?

A.    I didn’t know this was with. I just wanted to get it certificate.

Q.    Mm.

A.    I didn’t know this much. They said to me it’s something didn’t say, “This is the..(not transcribable)..they said they need a certificate. I gave it a certificate. Still..(not transcribable)..given everyone came to me and say, “Certificate, give me certificate for any transaction,” I have to gave to them if I got the record.

Q.    And that would be a good reason why you wouldn’t want to throw things out, wouldn’t it?

A.    Yeah.

Q.    Mm?

A.    No. I couldn’t, because I haven’t got enough room to keep all of this document.

Q.    You haven’t got enough room for a notebook?

A.    Yes. [my emphasis]

111. Mr Abedini professed nevertheless that he could get the details of the people who deposited amounts of money in his accounts from his agent in New York (T 159.7-159.15):

Q.    Where would you get it?

A.    Off the record. We got it from my agent in New York. They got the record, they pay the people. All of the payment - they got a record. Date, name, everything.

A.    He said to me, give me money, and then he said I need my money it doesn’t mean $550,000 – he’s been asking for $550,000.

Q.    Well, that’s what he said to you in August or September 2012.

A.    He’s been in house business, he’s been selling house since he’s came here. How come he’s paid me to buy them house. Why he didn’t buy house and do it himself?

Q.    Sorry, you said - I merely asked you this question: In August or September 2012, he sent you a text message and said, “I need my money.” Didn’t he?

A.    He’s been threatening me to give him money.

Q.    Mr Mehmani, it was a simple question--

A.    My money could be $10 could be $1 million. How come you telling me $550,000?

Q.    No, I’m simply saying to you that he sent you a text message in August or September 2012 saying words to the effect, “I need my money.”

A.    He’s been asking for money.

Q.    You say you never received any money from him at all.

A.    Nothing. How come his father, his mother, why didn't buy for them, buy the house for them? Why he didn’t buy for his wife family? He’s smarter than this, to give me money without any proof or anything.

Q.    Thank you. Is the answer to that question, “No”?

A.    No.

Q.    I take it that’s yes? The answer is, “Yes,” to my question?

A.    Which question?

Q.    You’re saying he didn’t lend you any money. Is that right?

A.    He didn’t lend me any money, no.

Q.    And I’m suggesting to you that he did.

A.    No.

Q.    And the purpose of the loan was to enable you to buy the house at Womboyne Place, and to renovate it.

A.    All made up story.

Q.    And one of the reasons why you wanted to do that, was because at that stage you were bankrupt, and you were trying to re-establish yourself. Isn’t that right?

A.    How come I was bankrupt and we’ve been already working?

Q.    I’m sorry, just answer my question.

A.    I had no time for the house. I was working for ABM Painting.

Q.    You were trying to re-establish yourself at a time when you were in financial difficulty. Isn’t that right?

A.    If even someone re-establishing himself, Navid help them? Navid don’t help anyone. He just, everyone knows, evillest person in the Iranians. [my emphasis]

200. Mr Mehmani disputed the amount of work that Mr Moshtael had done to the house; and disputed that he and his wife had a discussion about getting money from Mr Miraki. There was in that context the following (T 257.17-257.26):

Q.    I don’t know. Did you say to your wife that you were going to speak to Navid about getting some money?

A.    No. No-one's stupid to pay $550,000 without any track. You know that. Are you trying to make us, like, liar to prove he’s like, you know, 100% right? Never, ever speak about Navid. You know why? Because him and Roy is, you know, setting up to, my business went down because of them. After I came back from Iran, I hate him. I didn’t speak to him. Okay? I don’t know why this has come up, and like, you know, I have every proof he didn’t pay me one cent. He doesn’t pay. He took his family to the Court because of money. His brother, his mother, his father.

201. Counsel for the plaintiff sought to have the last answer struck as being unresponsive to the question asked. I allowed it subject to weight. It indicates the more argumentative and emotional stance adopted towards the end of Mr Mehmani’s cross-examination (as evidence by the accusation at T 256.25 extracted above).

202. In re-examination, Mr Mehmani gave the following evidence (T 258.14-258.26):

Q.    Some questions were just asked about Mr Moshtael being in the presence of your wife and yourself during the renovations‑‑

A.    Yeah.

Q.    ‑‑at Kellyville. When Mr Moshtael was in your house in Kellyville doing the renovations‑‑

A.    Yeah.

Q.    ‑‑where was your wife? When - and I’m asked when‑‑

A.    She never, ever came to the house until it’s finished. Because - you know - even in our culture when we are working in somewhere with the mans, woman doesn’t come to the house. If even they come to the house, they don’t come in front of someone. They come at night. And Moshtael was working for me.

203. I can place little weight on Mr Mehmani’s evidence. His memory was unreliable and his animosity towards Mr Miraki was evident.

Mr Abedini

204. Mr Abedini was an unreliable witness. His memory of even recent events was unclear. So for example, when questioned about when he had been approached to provide an outline of the evidence he was going to give orally, Mr Abedini did not appear to have a clear recollection of what had occurred only the previous week. His evidence at first was that he did not see anyone in the last week and had not been contacted by anyone in that last week. He said that he thought he was first contacted about the hearing just a few days before he received the subpoena.

205. Questioned as to a written outline of his evidence in which reference was made to a deposit of 1,470,115,500 into his Melli Bank account on 6 November 2010, Mr Abedini said he could not remember the exact amount. Shown the statement he explained that the amount in his outline of evidence was wrong by a small amount because he went to the wrong column – the balance column not the credit column. He said that the exact amount credited to his account was “just a little bit less than 147”. Mr Abedini accepted that there was a similar error in relation to the 21 November 2010 deposit. He did not accept that, prior to the deposits, there was virtually nothing in the account but was not able (without seeing the statement) to give the exact amount.

206. When queried as to when he gave the solicitors the numbers contained in his outline of evidence he said it was yesterday (which would have been a Sunday) and then that it was on Friday last week. At this stage, he became somewhat agitated in the witness box (T 165.23-165.43):

A.    No, sorry. It was on Friday. I do apologise. I am diabetes, and I - it's - at the moment, it's uncontrolled – it’s uncontrolled. My level of sugar is going up and it’s not good for me. I am here to give this evidence in the - my best acknowledgment, this money came to my account in Iran, and I gave it to them. Whatever happen after or before that is nothing to do with me. I don’t want to have the - a lot of pressure, because I can’t tolerate. My physically, I am not well enough. That’s why I retire.

Q.    Mr Abedini, is there some reason why you lied about not speaking to the solicitors last week about your outline of evidence?

A.    Okay. I just - I couldn't - I thought it's Monday, because it's a lot of pressure is the whole things it just make me nervous. I thought it was Monday I saw the solicitor. I make it - I made a mistake. I thought today is Tuesday, and Monday is yesterday. I just miscalculate everything. I can’t tolerate any pressure. Believe me.

Q.    The amount--

A.    I am nothing to do with this case. I don’t want to be involved in this case. The only thing I did, I bring the money from overseas and I gave the evidence, whatever I had. I can do no more than this. I can - listen to me. If you want to put the pressure on me, I can’t tolerate it.

207. I took a short adjournment at this point, following which Mr Abedini indicated that he was feeling better and the cross-examination resumed. His recollection did not improve.

208. Mr Abedini himself acknowledged the limits of his memory in general. Questioned as to whether there was some reason that he did not do the transfers electronically from his account to Ms Doss’ account he said that there was not but then added that sometimes people wanted the transfer straight away and that electronic transactions sometimes take 24 hours or 48 hours. There was then the following exchange (T 168.15-168.20):

Q.    And did she tell she wanted it straight away?

A.    Yes. Maybe.

Q.    Maybe? You don’t remember, do you?

A.    No. Eight years ago. How come I can remember exact conversation I did have with her or anyone else? [my emphasis]

209. Mr Abedini was asked about payments totalling $235,000 that he received from Ms Doss (pausing here I note that this is the evidence to which Mr Mehmani later referred) (i.e., about $130,000 on 6 November; about $90,000 on 21 November and $15,000 on 24 February) and his evidence that he had repaid to Ms Doss: $122,000 on 8 November, $16,000 on 11 November, and $32,000 on 7 December. Mr Abedini explained the difference by saying that he paid the rest in cash when they came to his restaurant (though there was nothing to this effect in his written outline of evidence or in the affidavit he had earlier affirmed.) He said that the cash payment was “supposed to be” or “should be” at the “end of the November or first of the December or middle of the December” (T 170.44-170.45). He then agreed that he had no recollection (at that moment) of having given the defendants any cash at all.

210. Mr Abedini said he had known the defendants “[b]ack to 2003, 2004” (t 171.11), because they used to come to his restaurant. He said they knew he was a money exchanger and that back in 2003 or 2004 he had sent some small amount of money (a maximum $1,000) to Iran for them. However, his evidence as to when he operated the restaurant is inconsistent with this timeline.

211. Counsel for the defendants readily accepted that Mr Abedini’s practices were “unorthodox” but submitted that he was an independent witness who had made it plain that he did not want to be giving evidence (and who, I could conclude, was “not here to come and be the knight in shining armour for the defendants” – T 279.18). As to the unreliability of his evidence, the defendants’ submission, as I understand it, was that this was in some way explicable by reference to Mr Abedini’s diabetic condition affecting his demeanour (and reference was made to his stressed state in the witness box at the time an adjournment was offered by me and accepted by him). I cannot possibly make such a finding. I have nothing against which I can judge Mr Abedini’s demeanour in the witness box so as to be able to form the view that it was affected by his health condition. It seemed to me, rather, that his agitation in the witness box followed on from his inability to explain how it was that he had come to give the evidence he had given in chief as to the particular transactions identified by him. Hence his outburst that he did not want to be involved in the case. (Indeed, the most credible part of his evidence was when he made it plain that he did not want to be in the witness box at all.) Whether or not the cause of Mr Abedini’s difficulty in recollection was due to his health, his evidence was both unreliable and implausible.

212. Thus I can place no weight on Mr Abedini’s evidence. His memory was unreliable; his assertion that he could remember the transactions in question (though acknowledging difficulty in other aspects – see T 168.15-20 extracted above) was implausible in the extreme. His explanation as to the lack of records (i.e., that he had them in March 2017 and then had destroyed them because he had insufficient room to keep them and because seven years had passed) was implausible. He has clearly reconstructed his memory of events from the documents shown to him and from Ms Doss’ own identification of the transactions that he understood he was being asked to “certify”. He was not a credible witness.

Plaintiffs’ submissions

213. The plaintiffs argue that the totality of the evidence supports the position contended for by them, namely that there was an agreement which was reached in April 2010 pursuant to which various loan advances were made to the defendants which then culminated in the purchase of the property at Kellyville and that further advances were then made for the purpose of the renovations to that property. The plaintiffs say that it was contemplated that there would be a mortgage raised to support the purchase and that the property would then be “flipped and sold, turned over as an investment” and the parties would share the profits in that venture.

214. The plaintiffs say that a series of cash amounts was advanced to Ms Doss with the expressed intention that the amounts were to be applied to the purchase of the property and to give her the wherewithal to establish her capacity to borrow money on a mortgage (at a time when Mr Mehmani was a bankrupt and was not himself in a position to become a registered proprietor of the property).

215. The plaintiffs accept that the versions of events given by them and by the defendants are diametrically opposed. They place weight, however, on two pieces of independent evidence that they submit assist their position: first, the evidence of Mr Moshtael (described in the defendants’ affidavit evidence as a “friend”) to the effect that when he was working on the renovations at the Kellyville property he heard conversations between the defendants in the context of moneys due to workmen as to when Mr Miraki was going to pay the money (see T 101.11-102.6); and, second, the evidence of Mr Burgess: first as to the $30,000 advanced to Mr Miraki on the basis of the explanation that Mr Miraki gave him in 2010 that he was involved in buying a house for renovation; and then as to the further conversation in 2011 following which Mr Burgess said he and Mr Miraki drove past the Kellyville property and Mr Miraki identified it as being the property in which he was investing.

216. As to Mr Moshtael’s evidence, it is submitted that this supports the plaintiffs’ evidence as to moneys being provided to the defendants in the context of the renovations (though not as to any particular amount(s) so paid). As to Mr Burgess’ evidence, it is submitted that there is a temporal nexus between the events he describes and the events alleged by the plaintiffs (that time being 2010-2011); and that his evidence therefore dispels the suggestion by the defendants that the plaintiffs’ claim is an invention aimed at exacting some kind of retribution against the plaintiffs.

217. The plaintiffs submit that the evidence establishes that the financial position of the defendants in the period up to December 2010 was not strong – Ms Doss having returned from Iran with her newborn twins some time early in 2009 and (on her own evidence) then having worked only on a part-time basis, largely from home, for Mr Fahanipour from A1 Best Air Conditioning Pty Ltd for five or six months earning at best $5,000 or $6,000 by way of commission, and being in receipt of a Centrelink parenting income during at least part of that period; and Mr Mehmani being a bankrupt.

218. Reliance is placed on the evidence as to the acquisition of a motor vehicle for $50,000 in August 2010 (T 217.12ff), with money that Ms Doss said came from Iran, as indicating that there is “a moving sea of something underpinning [Ms Doss]’ life, and it’s not money that’s earned from any reliable or quantifiable source, it’s money that has come from elsewhere” (T 266.21ff).

219. As to the evidence from Mr Abedini about the Iranian money exchange transactions, the plaintiffs submit that it is clear that Mr Abedini had no recollection about any of them and that he simply signed a letter at Ms Doss’ request certifying the transactions that she herself had numbered on a copy bank statement – in other words, that Mr Abedini said what he was asked to say (see T 271.4).

220. The plaintiffs attach significance to the fact that although the defendants were well alive to the issue about the Iranian account in March 2017, it was only a few days before the hearing (on 12 March 2018) that Ms Doss’ second affidavit deposing to these transactions was served, that being “the first mention of any money coming from Iran; the first mention of any bank account [in Iran]; and the first attempt to give some rational explanation for the mysterious appearance of $170,000 … the money having been deposited into the account after the exchange of contract” (T 271.14). The plaintiffs emphasise that there is no evidence of any authority ever being given to the bank manager at the Iranian bank to do anything in relation to the account; no evidence that Mr Mehmani’s brother-in-law collected a cheque and delivered it to Mr Abedini’s agent; and no details as to how the money was to be deposited into Mr Abedini’s Iranian bank account (T 271.45).

221. The plaintiffs note that the explanations given by Mr Abedini and Ms Doss as to what was to happen when the funds arrived into Mr Abedini’s bank account in Australia varied: Ms Doss’ account being that she would be advised by telephone and she would then request the transfer of the funds, which would occur by cash deposit or funds transfer; Mr Abedini’s account being that he was telephoned by Ms Doss, he told her that the funds had been deposited, and then, when he had some money, he would arrange for it to be deposited in her account. The plaintiffs say that there was never any funds transfer and submit that the money never actually arrived in Mr Abedini's account. The plaintiffs accept that there was some coincidence in the amount of $84,000 that was shown as having been withdrawn from Mr Abedini’s account on 8 November 2010 and the sum of $84,000 being deposited into Ms Doss’ account on 8 November 2010, but they say that there is nothing that links any of the other payments, nor did Mr Abedini give any reliable explanation as to why there were three deposits made into Ms Doss’ account on 8 November 2010 (cash; a deposit from “Little Parand”, and $8,000 from an unnamed customer of Mr Abedini).

222. The plaintiffs point out that there is no record in the evidence in relation to Mr Abedini’s Commonwealth Bank account showing any receipt of money from Iran. Moreover, the plaintiffs note that there is a discrepancy between Mr Abedini’s evidence that he received around $230,000 from Ms Doss via someone in Iran and the letter in which he certified that $170,000 (the total of the five transactions identified by Ms Doss) was received and paid.

223. As to the Iranian bank account, the plaintiffs say, first, that the explanation given by Ms Doss (T 234) that the monthly entries showing payment into the account of 78,179,452 rial (the explanation being that this was interest from the deposit that was in the account) cannot be correct in circumstances where the balance of the account at the time of the first such deposit (20 June 2010) was only 22,000 rial (that proposition being demonstrated by the fact that when the deposit was made on 20 June 2010 the account balance increased to 102,000,000 rial) (see Annexure C to Ms Doss’ second affidavit at p 30). Whether or not (as Counsel for the plaintiffs informed me at T 272.45) the monthly entries were the equivalent of sums varying with the exchange rate from $8,834 in June 2010 to $8,599 in August 2010, the proposition seems unarguable that (arithmetically) one would not receive that amount as interest each month when the balance of the account at the time was substantially less than the amount claimed to be interest.

224. The same conclusion is said to follow when the various credit transactions (identified in the bank account statement as numbers 36, 37 and 38) are added together (credits of $35,999; $50,329; and $37,810) and the debit at transaction 39 ($133,855) is deducted therefrom. Thus it is submitted that the credit transactions are clearly not interest and that they are “clearly large sums of money, clearly floating around unattached, and without any explanation whatsoever” (T 273.49)

225. The plaintiffs’ submission is that the defendants were effectively persons “of no real means” as at November/December 2010 yet they received sums totalling around $235,000 by some means. The plaintiffs’ position is that the explanation that these amounts were taken out of an account in Iran by some unexplained means should not be accepted and that the real explanation for these moneys is that the plaintiffs gave them a large amount of cash to provide them with the wherewithal to purchase the property and then to undertake the renovation of the house.

226. The plaintiffs submit that their case is cogent and persuasive; and that the explanation proffered by the defendants in March 2018 was no explanation at all, “because it simply highlighted the existence of an unexplained series of cash movements – [a] series of movements from a bank account into the account and out of the account - and then sought to give it some means of moving the money on shore through the offices of a money launderer”. (Pausing there, objection was taken by the defendants to the description of Mr Abedini as a “money launderer” and I make it clear here that I make no such finding.)

Defendants’ submissions

227. The defendants maintain that the Kellyville property was purchased from their own personal funds and from the finance received from BankWest. They rely on the bank statements tendered to show payments they made on their own account in relation to costs associated with the renovations.

228. As to the criticism made by the plaintiffs of the lateness of any explanation being proffered for the source of the funds, the response in effect was that a forensic decision was made not to adduce such evidence (see T 276.8) on the basis that up until 15 March 2018 the only evidence that was before the Court was evidence in relation to a contribution case (the plaintiffs’ evidence at that stage being comprised solely by the affidavit evidence served in September 2017).

229. The defendants’ position seems to be that it was only during the hearing of their application to set aside the notice to produce served on them in February 2018 that it became apparent that the plaintiffs were seeking to probe the suspicion that certain funds held in the defendants’ bank accounts were in fact the funds provided by the plaintiffs which assisted in the defendants obtaining finance from BankWest; that funds deposited into the defendants’ bank account at various times were in fact funds advanced by the plaintiffs; and that the defendants’ ability to service the loan facility was achieved from funds advanced from the plaintiffs.

230. The defendants say that they had previously mounted their case on the lack of proof that funds were ever advanced to them and the fact that the Kellyville property was purchased through their own means. It was in that context, they say, that Ms Doss’ 12 March 2018 affidavit was served, explaining why and how certain funds were deposited into her bank account, and that Mr Abedini’s affidavit was subsequently prepared.

231. Turning to the substantive issues in dispute (whether there was an agreement between the parties as alleged and whether any money was advanced by the plaintiffs as alleged) the defendants maintain that there is no satisfactory proof that money was ever advanced by the plaintiffs to the defendants and that hence the plaintiffs’ case fails.

232. The defendants point to the fact that the amount drawn down on the BankWest facility was the sum of $487,832.94 (Exhibit 8) and that, as at the time the NAB refinanced the loan, by 28 January 2015 (Exhibit 2 p 145), the debt position for the BankWest account was $459,035.78, meaning that only $28,797.16 had been paid off the loan since 2012. It was submitted that if the defendants had received moneys over that period then there would have been payments made into this account to lessen mortgage repayments or lessen the principal owing under the facility.

233. The defendants maintain that a credible explanation has been given for the large transactions coming into this Commonwealth Bank account (referring to a schedule handed up headed “Defendants’ Explanation for Cash and Cheque Deposits into the CBA Westpac Account”); that being that the payments into that account were deposits by (or perhaps more precisely, given his evidence, through the intervention of) Mr Abedini.

234. Reliance was also placed on the evidence that showed that as at the relevant time large sums of money were being received into the bank account of the company controlled by Ms Doss (ABM Painting Services) (see Exhibit 7 – an ANZ bank statement for the period from September 2010 to 28 March 2012), from third parties said to be contractors. The defendants argue that this shows that the defendants did have financial means at the time (albeit through the company account).

235. The deposit paid under the contract for sale of the property came from cheques drawn on Ms Doss’ Commonwealth Bank account (on 22 November 2010 a payment of $59,475 to the real estate agent and on 9 December 2010 a cheque drawn for the sum of $87,203.34). It is submitted that at the time those cheques were drawn Ms Doss had cash to pay for the deposit ($84,000 having been “injected” into the account) and that further sums of $30,000, $8,000, and $16,000 were obtained through Mr Abedini. (Although in submissions, reference was made to the $84,000 having been transferred electronically, Mr Abedini’s evidence was that it was deposited in cash.)

236. The defendants emphasise that Mr Miraki lodged no caveat and took no steps to register any security; nor did he take any step until the hearing to explain that the majority of the sums said to have been advanced to the defendants comprised a number of withdrawals. The defendants further point to the lack of any explanation in Mr Miraki’s affidavit as to how he contacted Ms Doss or where he met her on the occasions on which he says he advanced sums to her (though it should be noted that in cross-examination Mr Miraki was asked about where payments were made – see T 85).

Determination

237. The insuperable difficulty I face in this case is that there were no contemporaneous documents evidencing the alleged transaction and I do not consider any of the principal witnesses (Mr Miraki, Ms Doss and Mr Mehmani) to be reliable witnesses for the reasons to which I have earlier adverted. Ms Miraki was not an unreliable witness as such but she had little, if any, first-hand knowledge of what occurred and was reliant on her husband’s account of events. Moreover even if her account of the conversations giving rise to the alleged agreement is accepted, that evidence was in general terms and I am by no means persuaded that it establishes the existence of a concluded agreement on the terms pleaded or at all; nor does it assist to establish what sums, if any, were advanced to the defendants.

238. There are certainly aspects of the evidence that are consistent with Mr Miraki’s account of events – the strongest being Mr Burgess’ account of having been shown the property at the time Mr Miraki had asked him for a loan and it being described to him by Mr Miraki as the house in which he was investing. However, that does not overcome the doubts I have based on the lack of any written evidence of the agreement. Mr Moshtael’s evidence I would largely discount given the view I formed of his overall unreliability as a witness.

239. There are also aspects of the defendants’ account of events that I have difficulty accepting – such as the denial of any contact between the couples at all in the period from 2003 to 2007 (which is inconsistent with Mr Mehmani’s own version of events). And I am by no means able to accept the account given of the way in which moneys were transferred from Iran.

240. Both versions of events have their own implausible aspects – it is, at the very least, fiscally imprudent to lend $550,000 to a third party (albeit one related to the family) without any documentation at all; on the other hand the manner in which the money exchange was said to have been effected (also relying on no more than word of mouth and putting trust in someone met at a restaurant) is, as was conceded by Counsel for the defendants, unorthodox.

241. Whether any aspect of those dealings would be explicable by reference to Iranian culture or custom is something that was left wholly unexplained on the evidence.

242. Another implausible aspect of the matter is the sudden opening of a bank account in Iran in 2009 into which proceeds of sale of an hitherto apparently undisclosed piece of real estate (said to have been a wedding gift – thus presumably from around 2000) are said to have been deposited. Those assets were not disclosed by Ms Doss in either of her bank applications in relation to the property acquisitions in question (nor was the holding of an account in Iran in his name – whoever may have been entitled to the funds there deposited – ever disclosed to Mr Mehmani’s bankruptcy trustee). One might have thought that if this was indeed an asset available to Ms Doss (or to the defendants jointly) from as early as 2000 it would have been put forward as an asset when she gave details of her financial position to the brokers as part of the process of applying for loans with the respective banks. I accept that the defendants do not bear an onus in this regard, but the evidence of Ms Doss and Mr Mehmani must be tested having regard to the fact that ownership (and sale) of land in Iran would be peculiarly within their knowledge and ability to prove. The fact that there is nothing to corroborate the assertions by Mr Mehmani as to the existence of land in Iran being given to Ms Doss as a wedding gift (and that there was no reference to this by Ms Doss) makes it difficult to accept that explanation of events, even accepting the coincidence between a withdrawal of around $84,000 from the Iranian bank account and the deposit of sums totalling that amount in Ms Doss’ Commonwealth Bank account not long thereafter.

243. How Ms Doss managed, without much by way of income in Australia and while her husband was bankrupt, to acquire the Kellyville property remains a mystery to me – the most that can be said of the Iranian bank statements is that they demonstrate that there were moneys in another jurisdiction to which regular deposits (said to be of interest but clearly not referable to interest on balances in the account at the relevant time) and from which various withdrawals were made; and which might (if they did indeed end up in Ms Doss’ Australian bank account, whether with or without Mr Abedini’s assistance as intermediary) have been relied on to support the borrowings that were made. There is simply too much left unexplained in relation to the Iranian bank accounts and the explanation as to how funds arrived in Australia to make any findings in relation thereto.

244. I think it not unlikely that some sums were provided by Mr Miraki to Ms Doss at some stage (not least because this would provide an explanation for Mr Miraki’s alleged harassment of Mr Mehmani) but I simply cannot be satisfied when or in what amount. In reaching the figure of $550,000, Mr Miraki appears simply to have added up the large cash withdrawals from time to time from his wife’s accounts and attributed those to loans to the defendants. The account of the loan from the late Mr Szekely (and Mr Miraki’s attempts to repay it) is inherently implausible. I accept Mr Burgess was willing to lend Mr Miraki large amounts of money without any documentation but there is nothing to establish that that money went to Ms Doss.

245. It is trite to note that the onus of proof lies on the plaintiffs. In circumstances where I am left with real doubts as to which version of events is the truth, I am unable to conclude that on the balance of probabilities the plaintiffs have discharged their onus and therefore their claim must fail.

246. I have said nothing about the claims made for relief based on alleged breaches of fiduciary duty, or the doctrine of resulting trust, or for equitable contribution to the improvements to the property, restitution or the like. Each of those claims (none of which was the subject of any considered submission at the hearing) depends upon an acceptance of the account of events proffered by Mr Miraki on the balance of probabilities and hence those claims must follow the same fate as the claim based on the alleged agreement.

Conclusion

247. For the above reasons, I make the following orders:

1. Dismiss the plaintiffs’ claim with costs.

2. Order that the plaintiffs cause to be removed any caveat lodged under the Real Property Act 1900 (NSW) by the first plaintiff or the second plaintiff in relation to the land situated at 11 Vivaldi Place, Beaumont Hills being lot 6 of DP1023156.

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Amendments

31 July 2018 - Orders - '7 Vivaldi Place' amended to '11 Vivaldi Place'

Decision last updated: 31 July 2018