Bailey v Cox - [2005] WADC 202

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: BAILEY -v- COX [2005] WADC 202

CORAM: MULLER DCJ

HEARD: 20 & 21 SEPTEMBER 2005

DELIVERED : 28 OCTOBER 2005

FILE NO/S: CIV 1186 of 2003

BETWEEN: MARK CHRISTIAN BAILEY
Plaintiff
AND
DONNA MICHELLE COX
Defendant

Catchwords:

Contract - Loan of $60,000 by plaintiff to defendant - Onus on plaintiff to prove loan - Denial of loan by defendant - Counterclaim for $10,000 paid by defendant on plaintiff's behalf - Turns on own facts

Legislation:

Nil

Result:

Plaintiff's claim dismissed
Defendant's counterclaim dismissed

Representation:

Counsel:

Plaintiff: Mr M L Bennett
Defendant: Mr S F Popperwell

Solicitors:

Plaintiff: Bennett & Co
Defendant: Pynt & Partners

Case(s) referred to in judgment(s):

Nil

Case(s) also cited:

Nil

MULLER DCJ:

Introduction

In a statement of claim dated 24 July 2003 the plaintiff claimed that on 10 May 2001 he loaned the defendant an amount of $60,000 on the condition that the loan was repaid by the defendant to the plaintiff within a period of 11 months. It was further alleged by the plaintiff that after the time for repayment of the loan had elapsed, and several demands for payment had been made, the defendant repaid the plaintiff a total of $20,000 in two separate payments of $10,000 each. The plaintiff alleged that the defendant has failed to repay the balance of $40,000.
In her defence and counterclaim the defendant alleges that in April 2001 the plaintiff loaned the defendant an amount of $20,000 which was repaid in two separate payments of $10,000 each on 9 April 2001 and 4 May 2001. The defendant denies that the plaintiff loaned her an amount of $60,000 as claimed. In her counterclaim the defendant claims an amount of $10,000 from the plaintiff which the defendant alleges she paid to Sceales & Co, a firm of solicitors, for and on behalf of the plaintiff. It is alleged this amount was never repaid by the plaintiff to the defendant.

The plaintiff's evidence

The plaintiff, who was unemployed at the time of the hearing, had previously worked at the Perth Entertainment Centre. The defendant, a solicitor who worked for a company that had an interest in the Perth Entertainment Centre, met the plaintiff in 1996 during the course of her work.
Before he met the defendant, the plaintiff had become the subject of an inquiry by the National Crime Authority. Acting on advice he approached a solicitor named Defteros whom, he claimed, advised him to safeguard his assets during the course of the investigation by depositing his money in trust with the law firm of which Defteros was a member. Acting on this advice the plaintiff said he deposited $258,000 with the solicitor. Subsequently, when he asked for the return of the money, he claimed that only $128,000 was returned to him. He then commenced legal proceedings against Defteros for the return of the balance of the money he said he had deposited with the law firm.
It was against this background the plaintiff said his relationship with the defendant developed. When she became aware of his problems the plaintiff claimed the defendant advised him to approach a Perth firm of solicitors, Bennett & Co, and also offered her personal help with his legal problems with both Defteros and the Australian Taxation Office. The plaintiff said he accepted her offer and in the months that followed they frequently met and repeatedly discussed the legal issues he was involved in. The plaintiff also said the defendant actually contacted Defteros and tried to resolve the dispute.
In about April 2001 the plaintiff said the defendant advised him to transfer his money from his bank account to protect his assets in the event of his bankruptcy. It was at this time, according to the plaintiff, that the defendant asked him to lend her $20,000 which she said she needed to assist her mother. Claiming that he felt beholden to her for the assistance she had given him the plaintiff said he agreed to loan her the money. Despite her insistence that he should loan her the money in cash the plaintiff said that he gave her the money in the form of a bank cheque.
Following the loan of the $20,000 the plaintiff said he went to the defendant's unit in Scarborough and noticed that new shutters had been installed in the windows. Suspecting that the money had been used for the defendant's own benefit rather than on her mother's behalf the plaintiff said he asked for the loan to be repaid. It was common cause that the defendant repaid the plaintiff by giving him two cheques for $10,000 each. The first cheque was given by the defendant to the plaintiff a week or two before the second and he banked both cheques together on 4 May 2001.
At about the same time as the loan of $20,000 was made the plaintiff claimed the defendant persistently advised him to withdraw the balance of the funds he had in his bank account and entrust the money to her in order to protect his position in the event of his bankruptcy. The plaintiff claimed the defendant said she could use the money to pay his debts and arrange for legal representation if the need arose. The plaintiff said he eventually agreed with her suggestion and arranged to meet the defendant at the Central Law Courts on 10 May 2001 at the trial of his son, Michael, on criminal charges. Prior to that date he said he arranged with the National Bank to have the sum of $62,000 available in cash and, during a break in the proceedings, he went to the bank with the defendant and a friend named Justin Cooper where he withdrew a total of $62,900, put $2,900 in his wallet and the balance of $62,000 in $100 notes in a calico bank bag which he gave the defendant. He said he saw the defendant put the bank bag in a black backpack. Shortly before he gave her the money she had told him that she needed it for her mother and agreed to repay it within 12 months.
What is said to have happened at the National Bank and later that night at the plaintiff's house is absolutely crucial to the outcome of this trial. In support of his evidence the plaintiff called Justin Cooper who was a witness at the criminal trial involving the plaintiff's son and accompanied the plaintiff and the defendant to the National Bank during the luncheon adjournment. Cooper said he and the defendant waited in the bank while the plaintiff went to the teller to collect the money. He said he saw the teller give cash to the plaintiff who counted it before putting it in a calico bag. He went on to describe how the plaintiff then returned to where he and the defendant were waiting and the three of them left the bank together. Once outside he described how the plaintiff gave the calico bag to the defendant who put it in a black bag she was carrying. He said he and the plaintiff then left the defendant and returned to court for the resumption of the trial. After the trial had finished that afternoon Cooper said he left the plaintiff and did not see either the plaintiff or the defendant again on that date.
Because the events of 10 May 2001 are so crucial to the outcome of this trial I will return to them later. Following that date the plaintiff said he continued to meet the defendant regularly and rely on her assistance and advice. Given their continuing relationship of friendship and trust he said he was not concerned about the repayment of the loan he had made to her on 10 May 2001.
The next significant event occurred later in 2002. The defendant knew a businessman named David Bianci. The plaintiff said she told him Bianci was opening a nightclub and was looking for investors to loan money to him to finance his venture. He said the defendant recommended that he loan money to Bianci and stressed that he could trust him. She allegedly added that Bianci was prepared to pay a commission of $10,000 in exchange for a loan. The plaintiff said he told the defendant he did not want to deal with Bianci and that if she chose to invest the money he had loaned her with Bianci he did not want any financial return from Bianci. He said he left it to her to decide what to do with the money which she promised to repay within six months.
According to the plaintiff it was not until August 2002 that he asked the defendant when the loan he had made to her was going to be repaid. He said she suggested that the money ought to be reinvested with Bianci and that the plaintiff should accept the proposed $10,000 commission. The plaintiff said he told the defendant he did not want the commission and that she could have it.
By October/November 2002 the plaintiff said that he was no longer maintaining regular contact with the defendant and became anxious about the money he had loaned her. He gained the impression she was avoiding him and made arrangements to meet her at his house. On this occasion he allegedly asked her to repay the loan and claimed she suggested that they go together to Bianci's house to collect the money. He declined to go but accepted her assurance that she would do so. He claimed on this occasion she wrote several notes including the document introduced into evidence as Exhibit 4. This was a handwritten note which, on one interpretation, was addressed to David Bianci and referred to the repayment of money.
Between November/December 2002 the plaintiff said his concern over the repayment of the loan made to the defendant began to increase. At that time, acting on the defendant's advice, he had instructed a lawyer named Sceales to handle his tax matters. He approached the plaintiff and said he required $10,000 to put Sceales in funds. He described how she gave him a cheque for $10,000 (Exhibit 17) at her place of work. The cheque was made payable to Sceales & Co and he said he subsequently gave the cheque to the lawyers. At the same time as she gave him the cheque he reminded her that he wanted the balance of the loan repaid and he claimed she assured him that she would get the money back from David Bianci.
As time went by the plaintiff's concern began to increase. After several unsuccessful attempts to meet the plaintiff he eventually arranged to meet her at work. On this occasion he claimed she gave him $10,000 in $50 notes in part payment of the outstanding loan. It is significant that the money was given to him in an envelope which had the figures "$10K" handwritten on it. The plaintiff agreed the handwriting was hers.
In January 2003 the plaintiff said he again asked the defendant to repay the loan and claimed she became very agitated. He claimed she told him she would no longer assist him in his dispute with Defteros. He said he told her he wanted the balance of the loan repaid and subsequently arranged to meet her at a particular venue to settle the matter. He claimed the defendant did not appear and when he met up with her by chance later that day she told him that it was all over and that she had left his paperwork at a cafe in Ord Street. Realising that he was not going to be repaid the balance of the loan the plaintiff then issued a writ of summons commencing these proceedings.

Evidence of the defendant

The evidence of the defendant conflicted starkly with that of the plaintiff on several critical issues. While the defendant agreed that she became a close friend of the plaintiff, and advised him in his dispute with Defteros and the Australian Taxation Office, her account of the monetary transactions between them was totally different from the transactions described by the plaintiff. In relation to the first loan of $20,000 the defendant agreed she had received this amount from the plaintiff but her description of the circumstances in which the loan was made was quite different from what he had described. She claimed the plaintiff was aware that she and her husband had an interest in two beach units at Scarborough. She said she told the plaintiff she intended renovating the units at a cost of $20,000. She claimed she told him that she intended to obtain the finance for the renovations from her home equity facility account. She claimed the plaintiff told her that instead of borrowing the money from the bank he was willing to lend her $20,000 and would not charge her interest. She said she accepted the plaintiff's offer and on 4 April 2001 the plaintiff gave her a bank cheque for $20,000. She deposited that cheque in her home equity facility account on 4 April 2001. Within about four or five days of the loan being made she said the plaintiff told her that he wanted $10,000 repaid immediately. She agreed and arranged for a $10,000 cheque dated 11 April 2001 to be given to him. The plaintiff deposited that cheque in his own account some time later on 4 May 2001. On that same day he asked her to repay the balance of the loan immediately. Once again she arranged for him to receive a bank cheque dated 4 May 2001 for $10,000. This cheque was also deposited in the plaintiff's account on 4 May 2001.
While it is common cause that the plaintiff loaned the defendant $20,000 their respective accounts of the reasons for that loan differ substantially. From that point on their evidence of subsequent events diverges even more dramatically.
On 10 May 2001 the defendant agreed she attended the Central Law Counts for the trial of the plaintiff's son on criminal charges. She said she sat inside the courtroom with her friend, Gordon Batty, and that the plaintiff and Justin Cooper, who were both witnesses in the trial, sat outside the courtroom. During the luncheon adjournment she claimed the plaintiff told her he had to go to the National Australia Bank to withdraw money and then intended going to his lawyers, Bennett & Co, to pay an outstanding account. She said she agreed to accompany him and Justin Cooper to the bank. When they got to the bank she described how the plaintiff went to a bank teller where he remained for 20-30 minutes. She said he came back with a calico bag which he opened and which she saw was full of $100 notes. She went on to describe how the three of them returned to the courthouse where they met Gordon Batty in the foyer before returning to the courtroom where the trial was taking place. She said the plaintiff still had the calico bag in his hand when he arrived in court and made a remark to the effect that while he was giving evidence he was going to give the bag of money to the police in the expectation that might get his son off. She said she did not know whether he was joking or not. She claimed she remained in court that afternoon and saw both the plaintiff and Justin Cooper giving evidence. She said the plaintiff gave evidence first and, when he had finished, he remained in the public gallery when Cooper was called to give evidence. On entering the court she said Cooper gave the plaintiff the calico bag.
When court finished the defendant said she accompanied Cooper, Batty and the plaintiff to Bennett & Co's office and sat in the reception area. She claimed the plaintiff was still carrying the calico bag and was subsequently called in to what she believed to be the accounts section of the firm. When he had finished she agreed to take him home by car. On the journey home she said he continually complained about Bennett & Co charging him excessively and told her that he had paid them a significant amount of cash on that day. On arrival at the plaintiff's home the defendant said she sat on the sofa and began the task of reconciling various financial documents which the plaintiff had asked her earlier to examine. While she was doing this she claimed the plaintiff sat at the kitchen table and counted the money in the calico bag. Not long after she and the plaintiff had got home she said Justin Cooper arrived. He was joined later by a person named Christopher Seyward. She said Cooper sat on the sofa next to Christopher Seyward. She said she heard the plaintiff and Justin Cooper talking about the trial and saw the plaintiff hand a wad of $100 notes to Cooper. In cross-examination she said that after Cooper had left she had asked the plaintiff why he had given Cooper the money. She claimed the plaintiff told her it was a loan.
The defendant emphatically denied that the plaintiff had loaned her $60,000. She said she and her husband had considerable assets and did not need to borrow money. Apart from her assets and her income she also had access to a $180,000 credit facility upon which she was able to draw at any time. While she was emphatic that the plaintiff never loaned her $60,000 she said he did invest $40,000 with the business entrepreneur David Bianci. She described how this came about as a result of conversations she had with the plaintiff in February or March of 2002. At that time she and her husband had loaned Bianci significant amounts to support his new business venture. Bianci had asked her to find other potential investors. She claimed she told the plaintiff of the investment possibilities and enquired whether he was interested in investing money in the venture. She said the plaintiff questioned her extensively about her involvement with David Bianci and the details of any possible investment. On the day following this meeting she claimed the plaintiff telephoned her and said he intended investing $40,000 with David Bianci. She said he asked her to invest the money with Bianci on his behalf. She said she refused to do so and told him to negotiate with Bianci personally because she believed he would be able to get better terms than she would be able to get. The defendant claimed that was the extent of her involvement. She denied she had borrowed money from the plaintiff and invested that money with Bianci.
The defendant said she had made one further payment on behalf of the plaintiff. She claimed that on 13 or 14 January 2002 the plaintiff told her that his tax lawyers, Sceales & Co, required $10,000 in funds if he wanted them to continue to act on his behalf. He asked her to lend him the money and she agreed. She said she agreed because she had recommended that he approach Sceales & Co and she still regarded him as a close friend. She claimed the plaintiff agreed to repay her from the proceeds of the sale of a unit he owned. She said she telephoned Sceales & Co and asked whom the cheque should be made payable to. Following this she gave the plaintiff a cheque (Exhibit 17) made payable to Sceales & Co for $10,000.
Apart from the repayment of the earlier $20,000 loan the defendant claimed this was the only payment she made on behalf of the defendant. She denied emphatically that she had subsequently given him an envelope containing $10,000 in $50 notes. Following the delivery of the Sceales' cheque (Exhibit 17) the plaintiff said the defendant began to pester her about when his loan to David Bianci would be repaid. She said she consistently told him to speak to David Bianci himself because she was not involved in the transaction. She said the relationship between her and the plaintiff came to an end when he blamed her for advising him to invest in the Bianci venture. He allegedly told her Bianci was bankrupt and went on to demand that she pay the money he had invested.
The defendant called two witnesses to support her account of the events of 10 May 2001. The first of these witnesses was Gordon Batty, a friend of both the plaintiff and the defendant, who was present during the trial of the plaintiff's son at the Central Law Courts on 10 May 2001. During the luncheon adjournment the witness said he separated from the others and, shortly before the trial resumed in the afternoon, he met them in one of the lifts in the courthouse. He said the plaintiff had a calico bag in his hand and, on leaving the lift, made a remark along the following lines:
"Here's Mike's freedom. I'll slip these guys a couple of hundred."
The witness, who considered this remark to have been made jocularly, then went into the courtroom and was present when both the plaintiff and Justin Cooper gave evidence. He described how the plaintiff gave evidence first followed by Justin Cooper. He described how Justin Cooper, when called to give evidence, entered the courtroom and gave the plaintiff the calico bag he had seen the plaintiff with earlier. When the court adjourned in the afternoon Batty said he accompanied the plaintiff, the defendant and Cooper to Bennett & Co's office where he remained in the reception with the others while the plaintiff went into one of the offices carrying the calico bag. When the plaintiff came out Batty said he no longer had the bag. After leaving Bennett & Co's office he said he separated from the others and went his own way.

Christopher Seyward, the second witness called by the defendant, was also a mutual friend of both the plaintiff and the defendant. While he was not with the others in court on 10 May 2001 he said he did go to the plaintiff's house that evening to meet a friend of his who was living there at the time. He said on his arrival he saw the defendant sitting in a lounge chair going through various documents. He noticed that the plaintiff was seated at the dining room table counting what appeared to be a large number of $100 notes. He also saw what he described as a calico bank bag on the table. He said he heard the plaintiff complaining about the excessive fees charged by Bennett & Co. Seyward went on to describe how at about this time Justin Cooper arrived and sat on the lounge chair next to him. He said the plaintiff got up from the dining room table and sat next to Cooper. He heard the plaintiff and Justin Cooper talking about the outcome of the trial and laughing about what had happened. He described how the plaintiff then got up, went to the dining table where he collected and gave Justin Cooper a large bundle of bank notes wrapped in an elastic band. He claimed that when the plaintiff gave Cooper the bundle of notes he said words to the effect: "Thanks for the help mate".

Findings on credibility

As both counsel agreed this trial is unusual inasmuch as one party or the other, together with his or her witnesses, are clearly being untruthful. As I see it everything turns upon the events of 10 May 2001. The respective accounts of what occurred on that date conflict substantially. There is no room for a finding of error, misinterpretation or erroneous impression. One party and his or her witnesses are being truthful; the other and his or her witnesses are not. In considering this stark conflict, and trying to resolve it, I must begin with the principle that the burden of proving the loan of $60,000 lies on the plaintiff. He is required to establish the loan on a balance of probability. In relation to the counterclaim the same principle applies. The onus is on the defendant to establish the loan or payment made on behalf of the plaintiff on a balance of probability.
Adopting this approach I now propose to examine and analyse the evidence given by each party and his or her witnesses. Beginning with the evidence of the plaintiff the onus is on him to prove that he gave a bag containing cash to the plaintiff outside the National Bank of Australia on 10 May 2001. In considering whether that onus has been discharged to the required standard I must, in the first place, have regard to the demeanour of the plaintiff. I found him to be a plausible witness who was firm, unhesitant and direct in the answers he gave. There was nothing in his demeanour or the manner in which he testified that would lead me to disbelieve him. Counsel for the defendant, however, criticised his testimony and emphasised what he submitted were obvious and material flaws in the plaintiff's testimony. In the first place he criticised the defendant for issuing a writ without first making a formal demand for the money said to have been owed. That criticism is, in my view, not a valid one. Secondly, it was submitted that the plaintiff's evidence was inconsistent as to the terms of repayment of the initial $20,000 loan made to the defendant. While I agree the plaintiff did appear to be rather vague as to the precise terms of repayment I was unable to find any major conflict between the plaintiff's pleadings and his evidence on this issue. In cross-examination he said the plaintiff told him at the time that the $20,000 loan would be what was described as a short term loan. In the Reply to Defence it was asserted that the loan was to be repaid within a two or three week period. I do not believe there is any significant difference between the plaintiff's evidence and his pleading on this issue.
The plausibility of the plaintiff's account was also criticised on the ground that he banked the two $10,000 cheques made in repayment of the $20,000 loan on 4 May 2001 only to withdraw $60,000 six days later on 10 May 2001 to make the second loan to the defendant. Since, as he agreed under cross-examination, he had had to give the bank approximately seven days' notice of his intention to withdraw $60,000 in cash, it was suggested by counsel for the defendant that there would have been no sense in his having deposited the $20,000 repayment from the defendant on 4 May 2001 when, at precisely that time, he claimed he was arranging to withdraw a further $60,000 from the bank for the defendant's benefit. I agree it does seem rather strange that the plaintiff should have banked the two $10,000 cheques on 4 May 2001 given his intention at about that time to withdraw another $60,000 for the defendant's benefit. While his conduct may have been a little unusual, however, it was not something which leads me to doubt the truthfulness of his evidence as to the $60,000 loan.
In his pleading the plaintiff asserted that the $10,000 cheque which the defendant gave him to pay Sceales & Co was given to him by the plaintiff on 15 November 2002 at the offices of Sceales & Co. His evidence under cross-examination was different. When questioned on this point he agreed he had collected the $10,000 cheque from the plaintiff at her office. Once again I do not believe this discrepancy is particularly damaging. The significant issue is whether the defendant gave the plaintiff a cheque for this amount and the reason why it was given. The place where the transaction occurred is, in my view, a minor detail.
In his evidence the plaintiff described how, after the $60,000 loan had allegedly been made to the defendant, he met her in about August 2002 and she suggested rolling over the money he had loaned her into David Bianci's business venture. He said he raised no objection but refused to invest any money himself or to accept any commission or interest payment flowing from the rollover of the loan funds. Counsel for the defendant criticised the plaintiff for not referring to this alleged agreement to rollover the $60,000 into an advance to David Bianci in either his pleadings or his affidavit in support of an application for summary judgment. Once again I do not think that criticism is particularly valid. The plaintiff was always at pains to emphasise that he refused to make any personal investment in David Bianci's venture. He said he had loaned the money to the defendant and simply took no issue with her suggestion that it be reinvested with Bianci. He said as far as he was concerned he had made the loan to the defendant and left it to her to decide whether to invest money in Bianci's venture. In my view this was a matter of evidence that did not have to be pleaded or, for that matter, referred to in the plaintiff's affidavit.
There were other criticisms of the plaintiff's evidence including, for example, the fact that the writ of summons alleged that the amount of the loan was $40,000 as opposed to $60,000 as later claimed in the statement of claim. Once again I do not believe this in any way taints the evidence of the plaintiff. As far as I am concerned there were no major flaws or improbabilities in his testimony. There was nothing to suggest his account was untruthful, contrived or inherently improbable. The plaintiff was certainly not as intelligent or articulate a witness as the defendant but there is certainly nothing I can point to, either in his demeanour or in his actual account of events, that leads me to doubt or dismiss his testimony.
The evidence of Justin Cooper, the only other witness called by the plaintiff, was absolutely vital to the plaintiff's case. Any doubts I might have had as to the veracity or reliability of Cooper's evidence would unquestionably have affected my findings in relation to the plaintiff's account of events. Cooper was a vital witness. His evidence was corroborative of that of the plaintiff in relation to the events of 10 May 2001. I was impressed by Cooper as a witness. He was calm, firm and decisive in his testimony. His answers were direct and assertive and, apart from the allegation by the defendant that Cooper received a bundle or $100 notes from the plaintiff, he appeared to have no motive to misrepresent the facts. His evidence was absolutely crucial in several respects: first, he said he saw the calico bank bag being given by the plaintiff to the defendant outside the National Australia Bank; second, he said the defendant left the plaintiff and himself at this stage with the bag; and thirdly, he denied having gone to the offices of Bennett & Co after the court case ended that day or to the plaintiff's residence later that night. As with the plaintiff, I was unable to find anything either in his demeanour or in his account of events that would lead me to doubt his veracity or question the accuracy of his testimony.
I now turn to the evidence of the defendant. I found her to be a credible witness who gave her evidence very convincingly. As might be expected of someone with her qualifications and experience she was articulate, fluent and direct in the answers she gave. While Mr Bennett, who appeared as counsel for the plaintiff, criticised some aspects of her demeanour I was unable to find fault with the manner in which she gave her evidence. There was nothing so glaringly improbable in her account of events that would lead me to doubt the truthfulness of her account. I do intend to weigh the probabilities of the one party's case against that of the other at a later stage in these reasons but, for the moment, it will suffice to say that the defendant's description of events, particularly the crucial events of 10 May 2001, was entirely credible.
As was the case with the plaintiff, the defendant's evidence did not stand alone. Her account of the crucial events of 10 May 2001 was supported by the two witnesses she called, Gordon Batty and Christopher Seyward. I found Gordon Batty to be a rather excitable and argumentative witness. Putting to one side his criminal record for offences of dishonesty – his last conviction was 15 years ago – and taking into account that he suffers from dyslexia, I still did not find him to be as convincing a witness as the others I have already referred to. Having said that, however, his testimony certainly supported that of the defendant as to the events of 10 May 2001. It must also be remembered that he was a friend of both the plaintiff and the defendant and that he had no apparent motive to favour one over the other. While his recollection of detail may not have been as good as the others he certainly recalled the plaintiff being in possession of the calico bag on his return to the Central Law Courts on the afternoon of 10 May 2001 and also confirmed the defendant's evidence that Justin Cooper gave the calico bag to the plaintiff in court before he testified that afternoon. His inability to recall points of detail, as, for example, the furnishings and configuration of the offices of Bennett & Co, was the subject of strong criticism by counsel for the plaintiff. But I do not see this inability to remember purely incidental points of detail as necessarily detracting from the quality of his evidence. Making allowance for his condition there was nothing in his demeanour or in his description of events that I could point to as grounds for disbelieving or doubting his testimony. It is true that his evidence did conflict with that of Christopher Seyward, the other witness called by the defendant, on one material point. Batty said he saw the plaintiff go into the offices of Bennett & Co carrying a calico bag and come out later without the bag. Christopher Seyward, however, said he saw the calico bag on the table at the plaintiff's residence later that evening when the plaintiff was allegedly counting the cash. I agree this is a significant conflict which I will have to take into account. It appears certain that either Batty or Seyward is mistaken on what is clearly an extremely vital issue.
Christopher Seyward, the other witness called by the defendant, was, in my view, an extremely impressive witness. He was clearly well educated, articulate and had a clear recollection of the events of 10 May 2001. When asked to explain why his recollection of the events of that date was still clear he said the large amount of cash the plaintiff had, and the conversation between the plaintiff and Cooper as to the outcome of the criminal trial, were so unusual as to fix these events clearly in his mind. His evidence was criticised on two grounds: first, it was emphasised he had borrowed money from the defendant and was indebted to her at the time; and second, that his recollection of points of detail, such as the configuration of the plaintiff's residence, the pieces of furniture in his unit and the make up of that furniture was wrong. I really do not think those points of detail are particularly significant. These events occurred over four years ago and it is hardly surprising that the witness was not able to remember accurately what furniture was in the plaintiff's residence. As with the other witnesses whose evidence I have analysed the witness, Christopher Seyward, was not shown to have any motive to misrepresent the facts. While he was a friend of the defendant, and was also familiar with David Bianci, there is no apparent reason to conclude that his evidence was tailored to accommodate the defendant's case. He was, as I have said, an extremely impressive witness whose account confirmed the defendant's testimony and directly contradicted that of the plaintiff and Justin Cooper. Where his evidence conflicts with that of Batty on the issue of the calico bag, I unhesitatingly prefer and accept Seyward's account.
What I am left with after this analysis is an impression of each of the parties, and each of the witnesses called by each party, being a credible witness whose testimony, either standing alone or in conjunction with one or more other witnesses, can safely be accepted. As I have tried to make clear there was nothing in the demeanour of either party or any of the witnesses that would lead me to doubt the veracity of that party or the witness in question; nor was there anything in the account given by either party, or by any of the witnesses called, that I find to be improbable, doubtful or open to serious question. In short, before considering and balancing the probabilities of each party's version, I am unable to say who is being truthful and who is not. I will necessarily have to examine the probabilities to decide whether the plaintiff has discharged the onus resting on him and the defendant the onus resting on her.

Probabilities

In considering the plaintiff's case I accept that he relied heavily on the defendant to assist him in the legal problems he had with both Defteros and the Australian Taxation Office. It was common cause that the plaintiff withdrew $62,900 from the National Australia Bank in cash on 10 May 2001. It was also agreed that the defendant began investing in the David Bianci venture in about December 2001. Finally it was common cause that the defendant had paid $10,000 to Sceales & Co on behalf of the plaintiff but never demanded repayment of that amount until the commencement of these proceedings.
Apart from these facts that are common cause between the parties every other material issue was in dispute. In examining the probabilities of the plaintiff's claim it is appropriate to emphasise that the defendant was certainly a person of considerable assets who on the face of it would not need to borrow $60,000 either to meet her own commitments or to invest in the Bianci venture. She and her husband owned three properties including two prime beachfront units. The couple had terms deposits and owned vehicles. The defendant said she had an overdraft facility of $280,000 and that her credit card debt was limited to $10,000/$20,000. She said at the time her available line of credit facility was in the region of $180,000 and that she was earning $4,000 net monthly from her employment. Her husband was also employed. She invested approximately $107,000 in Bianci's venture using her own available funds. Given her relatively healthy financial position, and her access to a substantial line of credit facility, it was submitted by counsel for the defendant that she was unlikely to have asked the plaintiff for a $60,000 loan. Accepting the strength of that argument it must also be remembered that, despite her ready access to funds, she had earlier borrowed $20,000 from the plaintiff when, on her description of her assets and other wealth, there was no real reason for her to have done so. The fact that she borrowed $20,000 on the first occasion makes it more likely that she would, as the plaintiff asserted, borrow an additional amount of money on a later occasion.
The alleged cash payment of $10,000 said to have been made by the defendant to the plaintiff is, it was submitted, clear and convincing evidence of the loan of $60,000 having been made. The $10,000 cash was said to have been given by the defendant to the plaintiff in an envelope with the notation "$10K" in the defendant's handwriting on the outside of the envelope. The defendant explained this by saying the envelope contained a $10,000 cheque she had made payable to Sceales & Co on behalf of the plaintiff. She denied ever having given the plaintiff $10,000 in cash. The endorsement on the envelope is, however, probably more consistent with a cash payment than a payment by cheque. But the point is a very fine one. I am certainly not prepared to infer from that endorsement alone that the likelihood is the envelope contained $10,000 in cash as opposed to a cheque for that amount.
Another factor emphasised by counsel for the plaintiff was the unlikelihood of the plaintiff pursuing this action for the recovery of $60,000 from the defendant if, as the defendant alleged, the plaintiff had invested this amount directly with David Bianci. The defendant's allegation that the plaintiff invested the money directly and, on finding he could not recover it from Bianci, became so incensed that he brought these proceedings against the defendant is, it was submitted, so far fetched as to undermine the defendant's denial of the loan. I really do not see the issue in that way. If the defendant's account is truthful, and the plaintiff did invest money with Bianci, her assertion that he has brought these proceedings against her out of revenge or maliciousness is purely speculative and of no real assistance in determining the outcome. Nor do I think that the criticism of the defendant's lack of documentation of the money she claims she loaned to David Bianci helps in any way in resolving the material issues between the parties. The fact that the defendant may have been somewhat haphazard in her financial dealings with Bianci, and did not disclose what documents she had relating to those dealings until called upon to do so at the trial, does not reflect adversely upon her account or weaken her case in any way. The arrangements she had with Bianci were her own affair and were strictly irrelevant to the issue of the $60,000 loan.
In the end I am really unable to say that the probabilities favour one party's case over that of the other in relation to the $60,000 loan. Everything seems to come back to the events of 10 May 2001. One party and his or her witnesses are necessarily being untruthful as to what happened on that occasion. I am unable to find where the truth lies. Given my inability to be satisfied on a balance of probability that the plaintiff's account of the events of that day ought to be accepted in preference to that of the defendant and her witnesses I must necessarily come to the conclusion that the plaintiff has failed to prove the existence of the $60,000 loan.

I would dismiss the plaintiff's claim against the defendant.

Counterclaim

I am not satisfied to the required standard that the payment made by the defendant to Sceales & Co on behalf of the plaintiff constituted either a loan to the plaintiff or an amount which in law he was obliged to repay the defendant. Given the conflict in the evidence as to the circumstances in which that payment came to be made, and the marked differences in the evidence as to whether it was a loan by the defendant to the plaintiff or a partial repayment of a loan made by the plaintiff to the defendant, I am unable to come to a conclusion, for the reasons I have already explained, that the defendant's account is more probable than that of the plaintiff and ought to be accepted. There were no terms set as to repayment; no demand was ever made. The defendant even conceded she did not expect to be repaid. I simply am unable to find the loan proved.
I would dismiss the defendant's counterclaim against the plaintiff.