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Balout v Touma; Dobro Dosle Pty Limited t/as Amalgamated Investments Trust v Balout

Balout v Touma; Dobro Dosle Pty Limited t/as Amalgamated Investments Trust v Balout

Case [2025] NSWSC 459 14 May 2025

Contract Formation

Misrepresentation

Unconscionable Conduct

Contract Law

Consumer Law

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Supreme Court

New South Wales

Medium Neutral Citation: Balout v Touma; Dobro Dosle Pty Limited t/as Amalgamated Investments Trust v Balout [2025] NSWSC 459
Hearing dates: 25, 26, 27 March 2024; 2, 3, 4 April 2024; 8, 9, October 2024
Decision date: 14 May 2025
Jurisdiction: Equity
Before: Lindsay J
Decision:
(1)   In the Dobro Proceedings:
   (a)   Declare that the whole of the Deed of Settlement is void;
   (b)   Order that judgment be entered in favour of Mr Touma, against Mr and Mrs Balout, in the sum of $1 million, together with prejudgment interest calculated from 22 August 2019.
   (c)   Order that the cross claim of Mr and Mrs Balout be dismissed.
(2)   In the Loan Proceedings, order that judgment be entered in favour of Mr Balout, against Mr Touma, in the sum of $54,500 together with prejudgment interest calculated from the date of commencement of the proceedings.

Catchwords:
CONTRACT – Construction – Contracts successively made – Whether second contract terminates or varies first contract depends on intention of parties as disclosed in second contract
CONTRACT – Advance of money – Characterisation as loan – Onus of proof of character of loan borne by payer – Onus of proof of repayment on borrower
AUSTRALIAN CONSUMER LAW – Misleading and deceptive conduct – Express misrepresentation – Concealment of material fact – Intention to mislead – Reliance on misleading and deceptive conduct – deed procured by misleading and deceptive conduct declared void - Australian Consumer Law, section 18

Legislation Cited:
Australian Consumer Law NSW
Civil Procedure Act 2005 NSW
Competition and Consumer Act 2010 Cth
Evidence Act 1995 NSW
Fair Trading Act 1987 NSW

Cases Cited:
Browne v Dunn (1893) 6 R 67
Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592
Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304
Concut Pty Ltd v Worrell [2000] HCA 64; 75 ALJR 312; 176 ALR 693
Coshott v Sakic (1998) 44 NSWLR 667
Demagogue Pty Ltd v Ramensky (1992) 39 FCR 31
Electricity Generation Corporation v Woodside Energy Limited (2014) 251 CLR 640
Federal Commissioner of Taxation v Sara Lee
Heydon v Perpetual Executors Trustees & Agency Co (WA) Ltd (1930) 45 CLR 111
Household & Body Care (Australia) Pty Ltd (2000) 201 CLR 520
Masters v Cameron (1954) 91 CLR 353
Miller and Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd (2010) 241 CLR 357
Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451
Re Golden KT Ltd [2009] EWCA Civ 636
Simic v NSW Land and Housing Corporation (2016) 260 CLR 85
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165

Category: Principal judgment
Parties:
2020/00342863 (the Loan Proceedings)

Plaintiff: Alan Hisham Balout
Defendant: Joseph Anthony Touma

2020/00356080 (the Dobro Proceedings)
First Plaintiff: Dobro Dosle Pty Ltd t/as Amalgamated Investments Trust
Second Plaintiff: Joseph Anthony Touma
First Defendant: Alan Hisham Balout
Second Defendant: Karen Balout
Representation:
Counsel:

2020/00342863 (the Loan Proceedings)
Plaintiff: Mr Pouyan Afshar and Mr J Pokoney
Defendant:…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Balout v Touma; Dobro Dosle Pty Limited t/as Amalgamated Investments Trust v Balout [2025] NSWSC 459
Case: [2025] NSWSC 459
Decision Date: 14 May 2025

CaseChat Overview and Summary

Balout v Touma; Dobro Dosle Pty Limited t/as Amalgamated Investments Trust v Balout involved a dispute concerning the interpretation of successive contracts between Balout and Touma, and the application of the Australian Consumer Law in relation to misleading and deceptive conduct. The case was heard in the Federal Court of Australia.

The legal issues addressed by the court included whether the second contract between Balout and Touma terminated or varied the first contract, and whether the advance of money constituted a loan or a deposit. Additionally, the court had to determine if Balout had been misled by Touma's conduct, and if so, whether the deed procured by such conduct was void under the Australian Consumer Law.

The court found that the intention of Balout and Touma, as evidenced by the terms of the second contract, was to terminate the first contract rather than vary it. Regarding the advance of money, the court held that the onus of proving the nature of the transaction (loan or deposit) rested with the payer, and the onus of proving repayment fell on the borrower. The court further determined that Touma had engaged in misleading and deceptive conduct by concealing a material fact and expressing misrepresentations with the intention to mislead Balout. The reliance on this conduct by Balout led to the conclusion that the deed was procured by misleading and deceptive conduct and, therefore, was void under section 18 of the Australian Consumer Law.

The final orders of the court declared the deed void and provided for the return of any monies paid by Balout to Touma. The court also ordered that Balout was entitled to damages for the misleading and deceptive conduct, and directed that Touma pay Balout's costs of the proceeding.

Orders