Bianchi v Boserio

[2001] QDC 221

DISTRICT COURT OF QUEENSLAND

CITATION:	Bianchi v Boserio [2001] QDC 221
PARTIES:	VINCE BIANCHI (Plaintiff) SHEREE ANN BOSERIO (Defendant)
FILE NO/S:	81 of 2000
DIVISION:	Trial
PROCEEDING:
ORIGINATING	Cairns
COURT:
DELIVERED ON:	24/5/01
DELIVERED AT:	Cairns
HEARING DATE:	4/12/00
JUDGE:	White DCJ
ORDER:	Judgment for the defendant with costs.
CATCHWORDS:
COUNSEL:	J. Henry for the plaintiff C. Ryall for the defendant
SOLICITORS:	MacDonnells for the plaintiff Farrellys for the defendant

1. The plaintiff and defendant were boyfriend and girlfriend when they were at school. They effectively lived in a de facto relationship until sometime in the first half of 1998. They have four children who were aged 18, 15, 13 and 11 at the time of trial. It appears that the relationship was unstable at times but by around 1994 they were living together. At about that time the plaintiff established an automotive, panel- beating and spray-painting business in Tolga. According to the plaintiff he was to be the sole owner of the business but it appears that for income tax purposes it is accepted by the parties that they became equal partners in such business. The parties both worked in the business.

2. Throughout the life of the business until the parties separated in early 1998 it suffered from a chronic cash shortage. Substantial overdrafts and loans of various amounts were obtained. Various forms of security were provided in order to obtain such finance. Evidence was given of some of the details of these matters but in my view the detail is not particularly material and there is no need for me to set it out.

3. In about September, 1994 each of the parties took out a life insurance policy over the life of the other. It appears likely that this step was taken at the suggestion or insistence of their bank manager so as to provide additional security for the parties’ debts. In any event the purpose for which the policies were taken out is not material in my view.

4. The plaintiff Mr. Bianchi became the owner of policy No. 5263,495/3. The terms and conditions of the policy are contained in ex.14. The schedule to the policy is ex. 4. It notes that the life insured is Sheree Ann Boserio. The sum insured was $100,000. Not only did it insure the life of the defendant but provided a “trauma recovery benefit for the same sum” effectively insuring the defendant in respect of a variety of serious illnesses or disabilities. Premiums in respect of the two relevant insurance policies were paid from the joint bank account of the parties which was used as the operating account for the panel-beating business.

5. Towards the end of 1996 the defendant was found to be suffering from cervical cancer. This required operative treatment. She eventually recovered but of course there is a real risk that the cancer may re-occur and she requires ongoing checkups as a precaution. Cervical cancer was within the definition of “major trauma” in the insurance policy for the purposes of the trauma recovery benefit. With the assistance of their insurance agent, Peter Ashby, a claim was made on the policy owned by the plaintiff in respect of the defendant’s life to the National Mutual Life Association of Australasia (hereinafter referred to as “National Mutual”). After appropriate investigations National Mutual accepted the claim and by letter dated 19 February, 1997 to the plaintiff notified him that payment of the claim had been approved (ex.7). So as to finalise the claim they required an extract of the defendant’s birth certificate, an application for payment form to be signed by the plaintiff, and the policy document.

6. On 25 February, 1997 the defendant wrote a letter to National Mutual (ex.8) with certain attachments. One of these documents was an application for payment form which consisted of two pages. These two pages are in evidence as exhibits 9 and 10. It seems to be accepted that the policy document could not be found so as to be sent to National Mutual in accordance with its requirement of the 19 February, 1997. It was therefore necessary to fill out a document in respect of the missing policy. I am satisfied that such a document was filled out and a copy of it is in evidence as ex.11. Ex. 19 is a copy of ex.10 except for handwritten notations beside the signature of the plaintiff on ex. 10 and a notation on the bottom of ex.10 commencing “please credit etc.”. The plaintiff does not dispute that his signature appears on ex.10 and therefore ex.19. However, he claims to have no recollection at all of signing the document or in respect of any of the circumstances in which it was signed and in which the finalisation of the claim occurred. He did, however, know that the claim had been made and accepted by National Mutual. The plaintiff disputes that his signature appears on ex.11. The defendant says that it is his signature. Although this disputed signature is not directly relevant to the issues in the case, it is one about which I think a finding needs to be made and I will consider it a little later.

7. Ultimately, the money was paid, according to instructions to National Mutual, into the bank account of the defendant. The plaintiff in this action claims to recover the amount paid from the defendant.

8. As I have mentioned the panel-beating business was suffering from a chronic cash shortage and badly needed an injection of funds. Shortly after the defendant received the payment from National Mutual she made the first of three deposits into the joint bank account of the business. Details of these deposits are as follows:-

7 March 1997	$20,000.00
20 June 1997	$14,000.00
25 February 1998	$10,000.00

The plaintiff agrees that he knew about these payments. He also agrees that the defendant made these deposits on the basis that she was loaning the money to the business and that he knew that that was the basis of the payments at the time they were made. There is no suggestion on the part of the defendant that he in any way argued with this basis or asserted a claim to be entitled to the money at the time the payments were made. There are in evidence two income tax returns for the partnership between the plaintiff and the defendant for the years ended 30 June, 1997 and 30 June, 1998. The balance sheets attached thereto show that the advances from the defendant to the business were treated as loans in the books of account of the partnership. However, the plaintiff claims to have no knowledge of such matters and no ability to understand them.

1. The parties separated in early 1998. It is also apparent that they desired to separate their financial affairs also at that time. I get the impression that the separation did not occur on friendly terms and that is probably the explanation for a degree of animosity displayed by each party to the other during the course of their evidence. In order to formalise the end of their joint financial dealings and, in particular, in order to dissolve the partnership which owned the panel-beating business, they consulted a solicitor from Malanda who prepared, on their instructions, a deed of dissolution of the partnership. Clause 3 of that deed reads as follows:-

   “In consideration for the transfers hereinbefore provided the continuing partner shall pay to the retiring partner the sum of $44,000 free from interest by calendar monthly payments of a minimum of $500.00 per calendar month with the first payment to be made on 31st day of July, 1998 and subsequent payments calendar monthly thereafter, provided always that the said consideration shall be paid in full on the sale of the said business by the continuing partner.”

   The deed was signed by both parties. For the sake of completeness the deed specified the plaintiff as the continuing partner and the defendant as the retiring partner. “The transfers hereinbefore provided” basically provided that the plaintiff would be become sole proprietor of the business and its assets and would assume responsibility for all of its liabilities. It may be noted that clause 3 of the deed does not expressly provide that the $44,000 to be paid by the plaintiff to the defendant was a repayment of the loan of $44,000 by her to the partnership business. However, it is obvious from her evidence that that was what she had in mind as to the meaning of clause 3 of the deed. As to the plaintiff’s understanding he was asked in evidence in chief how he came to sign the deed and he answered –

   “Well, Sheree when she left me she was still coming to work from time to time and whenever she did turn up she was always telling me when am I going to pay her back her money and I just told her that I couldn’t afford to pay her $44,000. So I said that I’d pay her off. So I – when we rang Geoff Prior and Associates from Malanda and got Geoff to draw this up this agreement that I’d pay her off $500 a month.”

2. In my view, from that evidence it is clear also that the plaintiff understood clause 3 of the deed to mean that the $44,000 referred to therein was in fact the repayment of the loan by the defendant to the partnership business.

3. The plaintiff made a few payments of $500 per calendar month but then decided he didn’t want to pay anymore. The defendant then sued the plaintiff for monies owing by him to her pursuant to clause 3 of the deed. A copy of the plaintiff’s defence to the defendant’s action in the Magistrates Court is in evidence and it contains no assertion of any right or claim to recover the proceeds of the insurance payment from her. In fact, the plaintiff’s conduct at the time the defendant made the advances to the panel-beating business, his acceptance of the treatment of such advances in the partnership tax returns, his understanding of the true reason behind clause 3 of the Deed of Dissolution of Partnership which he signed, in my view are all inconsistent with a belief that he was entitled to the insurance claim money paid by National Mutual and deposited into the bank account of the defendant. I therefore prefer the evidence of the defendant as to the circumstances in which the documents sent to National Mutual in February 1997 were signed. I am satisfied that the plaintiff knowingly signed the authority nominating the defendant as the payee who was to receive the money from National Mutual.

4. As to ex. 17, the printing in the body of the form itself is significantly different to the printing on ex. 8 which is that of the defendant. I am therefore satisfied that the defendant did not prepare ex. 11. However, the printing on ex. 11 is very similar to that on the notation on the bottom of ex. 10 which I find was written on the original of ex. 9 and 10 after the document was printed by the defendant and signed by the plaintiff. There is no evidence identifying the person who filled out ex. 11 and made the notation at the bottom on ex. 10. I find that it was neither of the parties to this action. However, the letter to National Mutual written by the defendant on 25 February (ex. 8) on its face purports to suggest that the letter had the policy document attached. The fact that ex. 11 needed to be filled out at all suggests that in reality the policy document could not be found. On the face of it ex. 11 was filled out and signed the day after ex. 8 was written. It seems unlikely that when ex. 8 was written the defendant, or the plaintiff for that matter, would have in their possession a form relating to a lost or destroyed policy. Therefore it would have been necessary to obtain such a form and if the date on ex. 11 is correct that would have been obtained within 24 hours. The defendant recalls the insurance agent, Peter Ashby, being involved in the preparation of documents needed to have the claim paid. One possibility comes to mind. It may be the case that Mr. Ashby was involved in assisting in the preparation of these documents and when it became apparent that the policy document could not be found he may have provided the blank form of ex. 11 and assisted in its completion. He may have also been responsible for writing the additional details on the bottom of ex. 10. I make no positive finding about this because I do not consider that the evidence is sufficiently detailed to do so. I simply make the point that it is a possibility as a small point to further explain my finding that I am satisfied that the defendant did not engage in any misleading or deceptive conduct in the preparation of the various documents which led to the payout of the claim. As to the signature on ex. 11 the evidence is rather unsatisfactory. The plaintiff denies that it is his signature. It certainly has a less smooth appearance than the admitted signature of the plaintiff which appears on ex. 10. The defendant says that the plaintiff did sign ex. 11 because she saw him do so. There has been no expert analysis of the disputed signature and comparison with the proved signature. The documents themselves which are in evidence are copies only. On the other hand there are sufficient similarities in the structure of the proved and disputed signatures to allow in my view for them being written by the same hand with perhaps the signature on ex. 11 being written in a physically awkward situation or an uneven surface. What is more to the point is that if the defendant was going to forge the plaintiff’s signature on any document at all it would have been on ex. 8 rather than ex. 11. There is no reason at all to believe that the plaintiff would not have been willing to sign ex. 11 had he been asked to do so. On the balance of probabilities therefore I find that the signature on ex. 11 is that of the plaintiff.

5. In summary therefore I am satisfied that the plaintiff knew when he signed ex. 10 that he was authorising National Mutual to pay the proceeds of the claim to the defendant. By reason of his inconsistent conduct to which I have referred I am satisfied that he intended the defendant to have the permanent benefit of the money. In my view that is sufficient to make out the defendant’s assertion that the plaintiff made a gift of the claims money to her. Subject to the question of mistake which I will discuss shortly, I am satisfied that the reason why the plaintiff assigned the benefit of the claims money to the defendant was because she was the one who had in fact suffered from the major trauma which led to the claim under the policy being successful.

6. In his reply the plaintiff pleads that any assignment of the claims money was ineffective because the authority signed by him did not conform to the requirements of s.200(2a) of the Life Insurance Act 1995. In my view that subsection has no application to the present case. When the plaintiff signed the authority to the insurer to pay the claims money to the defendant the insurer had already admitted the debt due to the plaintiff arising out of the defendant’s illness. The document signed by the plaintiff was nothing more than an instruction to the insurer as to how to make the payment. In my view the plaintiff did nothing more by executing that document than assign the debt due to him from the insurance company to the defendant.

7. There is evidence which might possibly (and I put it no higher than possibly) support a conclusion that at the time the claim was made both the parties believed that it was the defendant and the defendant only, who was entitled to receive the claims money from National Mutual because she was the one who had suffered the illness which gave rise to the claim. In some circumstances a person who pays money, or for that matter assigns a debt, may recover the money if the payment or assignment is made by reason of a mistake. However, this is not the way the plaintiff’s claim to recover the money is framed. The claim is expressed to be for “the sum of $110,250 being monies received by the defendant to the use of the plaintiff.” The action for money had and received can arise in a variety of ways. In this case the basis upon which it is pleaded that the defendant receive the money to the use of the plaintiff is contained in paragraph 4 of the Statement of Claim which is as follows:-

   4.          On or about 25 February, 1997 –

(a)	the defendant represented to the insurer that she had the plaintiff’s authority to receive payment of the amount payable to the plaintiff under the policy for and on behalf of the plaintiff and in full discharge of the insurer’s liability to the plaintiff under the policy; and
(b)	the defendant requested the insurer to pay her the amount payable to the plaintiff under the policy.

Particulars

The defendant’s representation and request was conveyed to the insurer in writing in the form of a document entitled Application for Payment that was completed in part by the defendant and signed by the plaintiff on or about 25 February.”

There are some ambiguities with this pleading. Counsel for the defendant submitted that it is inadequate, because it does not specifically plead the capacity in which the plaintiff claims the defendant receive the money. Relating the plaintiff’s evidence to paragraph 4 of the Statement of Claim, the implication is that the plaintiff signed the application for payment without knowing what he was signing and the effect of it. As I have already indicate I reject such a suggestion and I am satisfied that the plaintiff knew what he was doing. Even if there are some deficiencies in the pleading, it is not necessary to decide this case on such a point because the plaintiff’s claim is simply not made out on any basis upon which it might be construed to have been brought in the Statement of Claim.

1. It is clear however that the plaintiff does not make his claim on the basis of any payment or assignment made pursuant to a mistake, whether of fact or law. It is of course possible in appropriate circumstances for a judge to amend pleadings so as to bring those pleadings into line with the evidence, and to properly resolve the real issues in dispute between the parties. Obviously a judge should only resort to such action in limited or exceptional circumstances. In this case I am not prepared to resort to such a course. In my view it would be completely unfair to the defendant to do so.

2. It emerged during evidence that the defendant may have possibly had some claims against the plaintiff. For instance, payments were made in respect of a mortgage loan for a house which was owned solely by the plaintiff from the joint bank account of the parties for the panel-beating business. There is some evidence that the plaintiff also purchased such things as a speed-boat for himself with money from such account. In addition the defendant signed the Deed of Dissolution of Partnership, virtually giving up any claims to the business and against the plaintiff arising out of the business as long as she was paid the $44,000 which she had loaned to the partnership. It is not to the point that, in terms of the commercial desirability, the plaintiff may not have received very much in the way of value under that deed. What he did receive was the whole of the business for himself. It is obvious by his signature on the deed that that is what he was wanting and he was prepared to agree to pay the $44,000 to the defendant in order to get it. In summary therefore I am of the view that if the plaintiff had made his claim on the basis of the repayment of money made by reason of a mistake the defendant could well have approached the litigation in a substantially different or more extensive way. In my view it would not be appropriate for me to amend any pleadings to deal with any issue of mistake. The plaintiff must be presumed to have chosen to bring the claim on the basis pleaded and having failed on that basis must fail completely. I propose therefore to give judgment for the defendant with costs.