Cavasinni v Cavasinni

[2001] NSWSC 223

CITATION:	Cavasinni v Cavasinni [2001] NSWSC 223
CURRENT JURISDICTION:	Equity Division
FILE NUMBER(S):	SC 3225/98; 1342/99
HEARING DATE(S):	6, 7 and 8 March 2001
JUDGMENT DATE:	30 March 2001
PARTIES :	3225/98 Ferdinando Cavasinni (P) Michael Cavasinni (D1) Francesco Cavasinni (D2) 1342/99 Michele Cavasinni (P1) Bice Cavasinni (P2) Ferdinando Cavasinni (D1) Bianca Cavasinni (D2)
JUDGMENT OF:	Young J

COUNSEL :	3225/98 F P Carnovale (P) J N West QC and D K L Raphael (D) 1342/99 J N West QC and D K L Raphael (P) F P Carnovale (D)
SOLICITORS:	3225/98 Andresakis & Associates (P) Smith Monti Costa (D) 1342/99 Smith Monti Costa (P) Andresakis & Associates (D)
CATCHWORDS:	CONTRACTS [7][17]- Whether a contract- Agreement between brothers to sell land- Whether intention to be bound other than in honour- Whether formal exchange contemplated. CONTRACTS [122]- Abandonment- What must be established. CONVEYANCING [67]- Trust- When does vendor become trustee for purchaser? EQUITY [119]- Statute of Frauds- Part performance- Acts must be unequivocal.
LEGISLATION CITED:	Conveyancing Act 1919, s 54A Limitation Act 1969, ss 27(2), 36, 47
CASES CITED:	Balfour v Balfour [1919] 2 KB 571 Chang v Registrar of Titles (1976) 137 CLR 177 Cooney v Burns (1922) 30 CLR 216 DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423 Eccles v Bryant [1948] Ch 93 Edwards v Skyways Ltd [1964] 1 WLR 349 Firth v Slingsby (1888) 58 LT 481 Fitzgerald v Masters (1956) 95 CLR 420 Francis v Francis [1952] VLR 321 McCann v By-Dezign Pty Ltd [2001] NSWSC 161 McWilliam v McWilliams Wines Pty Ltd (1964) 114 CLR 656 Masters v Cameron (1954) 91 CLR 353 Moravia v Levy (1786) 2 Term Rep 483; 100 ER 260 Paal Wilson & Co a/s v Partenreederei Hannah Blumenthal [1983] 1 AC 854 Road Australia Pty Ltd v Commissioner of Stamp Duties [2001] 1 Qd R 327 Treweeke v 36 Wolseley Road Pty Ltd (1973) 128 CLR 274 United Dominions Corp Ltd v Bryan Pty Ltd (1985) 157 CLR 1 Wakeling v Ripley (1951) 51 SR (NSW) 183 JC Williamson Ltd v Lukey & Mulholland (1931) 45 CLR 282 Young v Queensland Trustees Limited (1956) 99 CLR 560
DECISION:	See paras 80, 106, 107, 108.

THE SUPREME COURT

OF NEW SOUTH WALES

EQUITY DIVISION

YOUNG J

FRIDAY 30 MARCH 2001

3225/98 - CAVASINNI v CAVASINNI
1342/99 - CAVASINNI v CAVASINNI

JUDGMENT

1    HIS HONOUR: These two sets of proceedings concern two disputes between branches of the Cavasinni family. The disputes can be classed “the land claim” (1342/99) and “the money claim” (3225/98).

2    The parties are two families. The paterfamilias of the plaintiffs in 1342/99 is Michele or Michael or Mick Cavasinni whose wife is Bice and whose son is Frank. The paterfamilias of the other faction is Ferdinando, known as Fred, whose wife is Bianca. I will call Mick’s faction “the plaintiffs” and Fred’s faction “the defendants” for ease of reference. In evidence the parties were referred to by their first names and I will continue this practice in these reasons, without, of course, meaning any disrespect to anyone.

3    The land claim concerns a rectangular strip of land 10 metres by 32.615 metres being part of Lot 1 in DP 208823 of which Fred and Bianca are the registered proprietors. I will refer to this strip as “the disputed strip” in these reasons.

4    The money claim concerns the balance of accounts on a joint venture between Mick, Frank and Fred to develop town houses at Merrylands.

5    These reasons are structured as follows:

(1) The facts on the land claim;

(2) The issues arising on the land claim (I will specify the sub-issues when I reach that heading in these reasons);

(3) The result of the land claim;

(4) The facts on the money claim;

(5) The issues on the money claim;

(6) The result of the money claim.

6    The hearing of both proceedings took place before me on 6, 7 and 8 March 2001. Mr West QC and Mr D Raphael appeared for the plaintiffs and Mr Carnovale appeared for the defendants.

(1) The facts on the land claim

7    In 1983 there were discussions between Mick and Fred as to Mick buying a small piece of Fred’s land for $10,000.

8    Mick says that in about November 1983 Fred said to him, “Why don’t you buy the whole piece of land 10 metres wide right across my block. That will leave my block being squared off, instead of with a corner piece. I’ll sell the whole strip to you for $20,000”. Mick said he replied, “Okay if that’s what you want, I agree with that.” Mick says that the parties’ cousin Mario Cavasinni was with them and participated in the discussions.

9    About a week later, Fred and Mick went to the offices of Maclarens, solicitors, and spoke to Chris Maley who was their solicitor. Mr Maley did not give evidence in the case. Mick says that he and Fred told Chris Maley what they had agreed and Mr Maley said, “I will prepare all the necessary papers. You will need to get a surveyor to draw up the plans. Do you want to use your own surveyor or do you want me to get one for you?” Mick replied, “You get the surveyor and do all the paper work”. Fred agreed with Mick that the parties would leave it to Mr Maley to do all the “paper work”.

10    Mick says that by the end of March 1984, sketches had been received from the surveyors and that he went to Mr Maley’s office and pointed out which was the correct plan and Mr Maley said, “I will check this with Fred”. Mick then gave Mr Maley a cheque for $470 for costs and disbursements. Later Mick went to Mr Maley’s office again and was told to take the plans to Holroyd Council to be approved. At Mr Maley’s suggestion, Mick wrote a covering letter to the Council which accompanied the plans when they were submitted to the Council on 3 April 1984. The Council approved the plans, under delegated authority, the next day, subject to a certificate from the then Metropolitan Water Sewerage and Drainage Board under s 34B of the that authority’s Act. That certificate was issued on 18 October 1984. However, there were conditions attached to the approval including the provision of a linen plan accompanied by six copies and a further fee of $60 and demolition of sheds and structures on new lots and clearing of building materials to Council’s engineer’s satisfaction. These conditions numbered 3 and 4 in the Town Clerk’s letter of 27 April 1984 were never fulfilled. No plan was ever sealed or registered.

11    Fred says that there was a conversation in early 1984 in which Michael said, “Will you sell me the strip of land?” Fred said, “Yes for $20,000” and Michael said “Okay”. He also agrees that there was a meeting with Mr Maley about the matter. He says that at that meeting Mr Maley said, “We have to do a lot of things. We have to get a surveyor. We have to put an application to the Council. If the Council approves it I will have to prepare some documents and I will have to get you back here again for you to sign them.” Fred said that that was the last he heard about the matter. He had no knowledge of any plans being lodged with the Council or any approval having been granted by the Council and the first time he saw any of these documents was in 1999, after Mick commenced the present agitation for specific performance.

12 Thus both parties acknowledge that words such as those on which Mick relies as contractual were said. The issues I have to decide lie elsewhere. Again, I note that Mick agrees that there has been no compliance with s 54A of the Conveyancing Act, but says that there were many acts of part performance.

13    There is a strong dispute as to whether the purchase money was paid. Mick says that “a few days later” (it is not quite clear what this means but I think it means a few days after the visit to Mr Maley’s office) in the evening he went with his wife Bice to Fred’s home. He says the day before Fred had said, “I need the money in cash. I owe the Commonwealth Bank money and I don’t want to put it in the Bank because they will grab it and I will have no money to pay contractors on the Skye Close property. Can you give it to me in cash?” This referred to the purchase price for the land. Mick says he replied, “Yes I will bring it in cash”. He did so and handed it to Fred in the presence of Frank and Bice. Frank counted the cash in front of Fred before Mick handed it to Fred. Bice was present.

14    Fred denies receiving any cash, or indeed, any part of the $20,000. Bianca confirms that she never received any money from Mick or Bice in respect of the disputed land, nor did she ever see any cash or other moneys being paid to Mick and denies that the events set out in various affidavits of the opposing faction, which allegedly took place in her presence, did so take place.

15    Frank says, “I was … present at … around October-November 1984, when my father handed my uncle $14,000 in cash. In fact I counted the $14,000 before it was given to him. My uncle said to my father in my presence immediately after the cash was handed to him, ‘thank’s a lot, that pays off the balance of the strip of land’ My father said ‘that’s a good deal done’.” In an earlier affidavit Frank had said, “I saw my father hand my uncle the sum of $6,000 in cash. I was present and saw my father hand my uncle a sum of $14,000 in cash which amount I counted. At the time my uncle said to me and my father ‘thank’s a lot, I need this to pay my contractors of the Lot 4 job’. My father said ‘good that’s your share of what you need to pay’.”

16    Frank then said, “One weekend soon after my father paid the $14,000, my father and my uncle and I disconnected the water supply to the sheds on the strip of land, and we also disconnected the electricity which was being supplied to the sheds from a light pole in my uncle’s back yard. I remember my uncle saying to me ‘I’m sure this land will be a big improvement to your home. I certainly needed the money your father paid me’.” Frank also says that within a month of the money being paid he saw his uncle and father constructing a new fence with concrete retaining wall and a five foot high fence made out of wire mesh.

17    Mario Cavasinni, a cousin of both the major protagonists, gave corroborative evidence of the conversation for selling the land and he also said that a few years ago when he was with Fred at the Obruzzi Club, Fred said, “I wish I hadn’t sold that land to Michele. My daughter Connie is getting married and I want to build a house for her on that land.” Bice Cavasinni says too that about five years ago Fred came over to her house and said, “I want you to sell that land back to me because I want to build a house for my daughter” to which both she and Mick said, “The land is ours now and we don’t want to sell it back to you.”

18    So far I have dealt with the competing version of the facts as to the payment of the $14,000.

19    The purchase price was $20,000. Mick says that he and Fred wished to buy a unit in a unit trust known as “the Tudor Unit Trust” which was developing some land in Merrylands. The trustee was Grandtron Pty Ltd. Mick says that he paid $12,000 of his own funds to Grandtron Pty Ltd and two units were issued, one in Fred’s name and one in Mick’s name for a $5,000 investment. The additional $1,000 appears to have either been a premium or commission, the evidence does not show which. Mick produced the receipt for the $12,000 and the certificates of unit holders’ entitlements were produced though for some reason or other they had strange dates on them.

20    Mick’s case is that the $6,000 paid by Mick for Fred’s unit from Mick’s own money was a loan and there was an agreement to offset that loan against the $20,000.

21    Fred’s version is that he and Mick were at that stage involved together in a concreting business which is conducted by a company D’Aroma Concrete Pty Ltd, which is trustee for a unit trust, which at the relevant time was held for both Mick and Fred. Fred says that he at all times thought that the purchase price of the units in the Tudor Unit Trust came from the moneys to which they were jointly entitled from D’Aroma Concrete. At no stage had Mick ever told him otherwise, nor had Mick ever had any agreement with him for any set-off.

22    The fact-finding exercise that has to be performed involves assessing the credibility of the witnesses, principally Mick, Fred and Frank. This assessment must be done in the light of the whole of the evidence both on the land claim and on the money claim.

23    However, the principal focus of the facts on the land claim are whether the $14,000 and the $6,000 were paid or not. I will deal with this in more detail in section (2)(c) of these reasons. However, it is clear that both factions were involved in the concreting business and that operating in a cash economy was not as strange to them as it might be to other members of the community.

24    The facts which are put forward on the question of part performance are further considered in section (2)(g).

(2) The Issues Arising on the Land Claim

25    It seems to me that I must analyse the following issues:

(a) Was the oral agreement intended to create legal relations?

(b) Was that agreement subject to a condition precedent that formal contracts for sale were to be exchanged?

(c) Was the purchase price paid?

(d) Do the defendants hold the disputed strip on trust for the plaintiffs?

(e) Was the agreement abandoned?

(f) Is the land claim statute barred?

(g) Is there proof of acts of part performance?

I will deal with each of these issues in turn.

26 (2) (a) It is clear that in certain family situations and in situations between members of a church or a social club and the like, that what looks like a binding agreement is in fact never intended to be a legally binding agreement at all. The classic example is Balfour v Balfour [1919] 2 KB 571, discussed in the 7th Australian edition of Cheshire & Fifoot’s Law of Contract (Butterworths, Sydney, 1997) pages 184 and following.

27 In Edwards v Skyways Ltd [1964] 1 WLR 349, 354-5, Megaw J said, “Where the subject-matter of the agreement is some domestic or social relationship or transaction… the law will often deny legal consequences to the agreement, because of the very nature of the subject-matter. Where the subject-matter of the agreement is not domestic or social, but is related to business affairs, the parties may, by using clear words, show that their intention is to make the transaction binding, in honour only, and not in law; and the courts will give effect to the expressed intention.” His Lordship also said at 355, “The onus is on the party who asserts that no legal effect was intended, and the onus is a heavy one.” See also Wakeling v Ripley (1951) 51 SR (NSW) 183.

28    There is no evidence in any of the surrounding circumstances which would indicate that the parties did not intend legal relations. Indeed, the mere fact that money passed or was agreed to pass and that Mick spent money on survey fees and solicitors’ fees and submitted the plan to the Holroyd Council for approval shows the parties did intend a legally binding agreement to come into force, either then or when formal contracts were exchanged.

29    Accordingly, I find issue (a) in favour of the plaintiffs.

30 (2) (b) The usual intention of parties to contracts for the sale of land is that there is no binding legal contract until there has been an exchange of contract documents: Eccles v Bryant [1948] Ch 93.

31    The question is also one of intention and must be judged on the facts of each individual case.

32    The present case is different to many in that a relatively small price is involved, namely $20,000 and the transaction is between relatives. Accordingly, one would not necessarily look to the same formalities as one would look for in a multi million dollar purchase between strangers.

33    However, the evidence on both sides is that Mr Maley, solicitor, was to be involved in the transaction. As I have noted, Mr Maley wasn’t called to give evidence. It appears that all the parties were unhappy with him for some reason or another. However, the fact that he was not called does not assist me in the instant case. As he was both parties’ solicitor it is hard to draw the inferences that might otherwise be drawn if a witness is clearly in one camp or the other. However, the fact that Mr Maley was involved showed that the parties did intend to do what they would call “the paper work” properly. They both knew that this “paper work” would include at least the preparation of a surveyor’s plan, the payment of council fees, and the preparation of some formal legal document.

34    Even though there was only a relatively small amount of land and a small purchase price involved, it does seem to me that it is more likely than not that the parties did not intend there to be a final bargain until the proper documents were prepared by Mr Maley. Even on Mick’s evidence, Mr Maley was to contact a surveyor and do the “paper work” and that that “paper work” was to include not only the surveying work.

35 As I have said on many previous occasions, the most recent of which is McCann v By-Dezign Pty Ltd [2001] NSWSC 161, the Court is often asked to decide which of the four classes postulated in Masters v Cameron (1954) 91 CLR 353, a case falls within, on very scant evidence. The present is no exception.

36    My inclination, on the material that I have noted in these reasons so far, is that it is more likely than not that Fred’s thinking, that there was to be no binding contract until the plan was registered, represented the parties’ intention.

37    However, it is necessary to look at other facts, including facts which occurred after the hands were shaken on the $20,000 conversation.

38    There is evidence which I have reviewed under section (2)(g) as to acts done on the land which might constitute part performance. As I note under that heading, many of the acts are equivocal. It needs to be remembered that the disputed strip is a strip of land between properties owned by Mick and his wife and Fred and his wife and that for some time Mick and Fred were beneficiaries in the unit trust which controlled D’Aroma Concrete. The land was used for their business purposes. Although one side says, and the other denies, that after the agreement the dominant user of the disputed strip changed from Fred to Mick, the evidence is not sufficiently strong to enable me to hold this. It is undoubtedly true that Mick used part of the land for his own purposes and put in some concrete paving, but in all the circumstances those acts are not sufficiently strong as to amount to acts from which one can find the intention of the parties.

39    Furthermore, the Council requirement was that the sheds be demolished on the disputed strip. It did not suit the business purposes of either party to do this and they didn’t do it. At least Mick must have known the Council conditions, because he was the applicant. Mick knew that the final Council consent would not be given unless the conditions were complied with. That is one of the reasons why he applied to the Water Board for a s 34B certificate, yet at no stage did he demolish the sheds, or, it would seem, submit the linen plan for sealing. He must have known that the conveyance could not go through until then and it would not be “legal”. This seems to me to tell against an intention of an absolutely binding contract as at the date on which there was shaking of hands.

40    However, the most vital fact would be the payment of money. If it were established that the $20,000 or even $14,000 was paid and not refunded, then that would be the clearest evidence that the parties intended to be bound by the informal agreement. However, as I note in section 2(c) I could not be satisfied on the balance of probabilities that either sum of money was paid.

41    Finally there is the evidence that about five years ago Fred said to a couple of people that he wished he had not sold the land as he wished to build a house on the land for Connie his daughter. This does appear to have been said in some form or other and does tend to go towards the finding that there was an intention to be immediately bound.

42    However, when one adds up all the factors, and the great delay in applying for relief in this Court, it seems to me more likely than not that the parties did not intend that there be binding contracts until there was at least the signing and lodging of a registrable transfer.

43 (2) (c) I have already outlined the facts. It is clear that the onus of proving payment is on the payer: Young v Queensland Trustees Limited (1956) 99 CLR 560.

44    The evidence of the major parties was diametrically opposed and it is thus necessary to assess their credibility.

45    I must confess I did not find that the major witnesses filled me with a lot of confidence that their evidence was correct. This is understandable to a degree in that a long time has passed since the vital facts occurred, but this was not the whole of the answer.

46    Mick was not a very satisfactory witness at all. He gave his evidence in a fairly belligerent manner. He often insisted on adding non-responsive material to answers when he thought he was helping himself. However, when asked about details, particularly details which might have been embarrassing, his stock answer was “I don’t remember”. I thought there were far more “I don’t know” or “I don’t remember” than would be expected even though 10 to 17 years had passed.

47    Frank was also a very poor witness. At the most charitable, his affidavits were prepared without due care and attention. At worse, they were deliberately misleading. Frank denied that his affidavits were prepared without due care and attention, but this at least must be so. There are instances where Frank’s material is simply wrong. The prime example is where Frank swore that he saw Mick hand Fred $6,000 in cash. That statement was radically changed in a later affidavit. Frank’s explanation that he never intended to say anything about payment of $6,000 but somehow or other those words were typed in his affidavit and he overlooked them when swearing it, was not at all impressive.

48    Mr West QC, however, puts that I would need to find that both Mick and Frank deliberately put their heads together to concoct the story of the $14,000 payment and that I could not reach that view. Mr West QC said that it was clear that the family functioned in the cash economy and it would not have been at all unusual to find a cash payment of this magnitude.

49    Fred disagreed that there was a cash economy amongst the family. He said he was quite surprised when the sum of $100,000 in respect of the sale of Bossley Park was handed over in cash. He said normally that cash transactions did not take place in the family.

50    There was some cross examination as to the $14,000. Mr Carnovale at T34 asked where Mick had gotten the cash, to which the answer was, from the safe at his house. Then he asked “When you gave him the cash did Fred tell you what he was going to do with it?” to which the answer was “He didn’t tell me nothing”. Then the question was put another way “Fred didn’t ask you for cash did he?”

A. “Yes he did.”

Q. “Did he tell you what he wanted the cash for?”

A. “First of all, because we are building next door, No 4, and he wants to pay some tradesmen their money and he say ‘If you give some cash we can pay some tradesmen in cash’ and that’s why I give him cash.”

51    At T110, Frank was cross examined and skirted round the questions as to why there was a difference between the conversation in his affidavit of 22 June 1999 (PA07) on the one hand, and his most recent affidavit, PA04, of 2 March 2001, on the other hand.

52    As I have said, the onus is on the person paying the money to prove the payment. I found it difficult to accept completely the evidence of Mick. It seemed to me that his consistent denials whenever an awkward question was asked, severely affected his credibility. Frank was in the worse position in that the story about the $6,000 cash was clearly an invention, he seemed to think that any statement that he made in a later affidavit corrected the earlier, and gave the feeble answer to the question about the $6,000 payment that whilst he was careful when he read his affidavit that must just have slipped through - somebody must have typed it by mistake. He also did not explain the discrepancies between his two affidavits as to the conversation. I am also not completely satisfied that the family did consistently indulge in a cash economy.

53    I must say that Fred also had his limitations as a witness. At one stage of Fred’s evidence I made the mistake of thinking that he was not acute enough to understand what I was saying to counsel. However, I noticed that after I had made my statement, Fred was moulding his answers so as to build upon my statement which made me assess him as a very astute man.

54    However, the onus is on the plaintiffs, in view of the caution with which I approached their oral evidence, the lack of supporting material and Fred’s denial, I am not satisfied on the balance of probabilities that $14,000 was paid.

55    As to the $6,000, the payment for the Tudor Unit Trust was made in November 1981. The alleged conversation about the $6,000 took place somewhere in 1984. There must have been many transactions between the parties during that period, and it is rather difficult for this particular transaction is likely to have come up as a set-off.

56    In addition to the doubts I have about the credibility of Mick and Frank, the circumstance I have just mentioned and the fact that Fred’s evidence sounded credible that he thought that the $12,000 had come from D’Aroma Concrete moneys, makes me find that I am not satisfied that the $6,000 was an agreed set-off against the purchase price for the disputed strip.

57    It follows that I am not satisfied that the purchase price was paid.

58    (2) (d) It follows from my answer to (2)(c) that there is no trust because the purchase price was not paid.

59 However, even if I were wrong on this point, there is great difficulty in finding a trust. As the High Court said in Chang v Registrar of Titles (1976) 137 CLR 177, 184-185, that in a vendor/purchaser situation, the vendor holds on trust for the purchaser (a ) when the purchase money has been completely paid; or (b) where there is a specifically enforceable contract for sale where title has been made out by the vendor or accepted by the purchaser. The law was recently discussed by the Queensland Court of Appeal in Road Australia Pty Ltd v Commissioner of Stamp Duties [2001] 1 Qd R 327, 339-342.

60 In the present case, there may well be an obligation on both parties to do all that they can to bring about the sealing of the plan, but until that obligation is carried out, by order of the Court or otherwise, the vendor is not a trustee for the purchaser: McWilliam v McWilliams Wines Pty Ltd (1964) 114 CLR 656.

61 (2) (e) Abandonment is a shorthand word to describe the process whereby parties agree by words or conduct (including silence) to terminate a contract; see Fitzgerald v Masters (1956) 95 CLR 420, 432-3; Paal Wilson & Co a/s v Partenreederei Hannah Blumenthal [1983] 1 AC 854, 924 and see DTR Nominees Pty Ltd v Mona Homes Pty Ltd (1978) 138 CLR 423 and Chitty on Contracts 28th ed (Sweet & Maxwell, London, 1999) Vol 1, 23-027.

62 Most of the cases on the subject have been English shipping cases such as those mentioned in footnote 92 to the paragraph in Chitty to which I have referred, or easement cases. The question that the Court has to consider is one of fact bearing in mind all the circumstances; see eg Treweeke v 36 Wolseley Road Pty Ltd (1973) 128 CLR 274.

63    In the instant case, the agreement to abandon must be inferred from conduct if it is to be inferred at all.

64    Mr Carnovale says that the following facts and circumstances leads to the inference that the contract was abandoned:

(i) 15 years passed since the contract was made;

(ii) the plaintiffs did not seek to enforce the contract for 15 years;

(iii) the Council took conditions on the subdivision with which neither party was wishing to comply, namely, the removal of the sheds;

(iv) the consideration was never paid.

65 In Fitzgerald v Masters (1956) 95 CLR 420, 432, Dixon CJ and Fullagar J analysed the cases on abandonment where there had been an inordinate delay. In that case there had been a contract between partners in 1931 in which half the purchase money had eventually been paid and in 1953 the plaintiff commenced specific performance. The High Court upheld the decree for specific performance made by C McLelland J in this Court. The Judges said, after listening to all the cases, that they were all cases of executory contracts and that long delay where the moneys paid under the contract were not repaid was not enough on the facts of that case to infer abandonment.

66    The matter is one involving a decision on the question of fact. It does not seem to me that there is sufficient here in the instant case to find an intention to abandon.

(2) (f) The Limitation Act 1969.

67 The alleged contract was made in about 1984. The present proceedings were commenced on 12 February 1999. Mr Carnovale says that it follows that either under the Limitation Act, or alternatively, on equitable principles analogous to those contained in the Limitation Act, the present proceedings are statute barred.

68 There are various possible categories into which the present case could fall specified in the Limitation Act, for instance s 27(2) puts a bar on actions to recover land of 12 years, s 36 makes the same provision for equitable interests and s 47 makes the same period applicable to cases of breach of trust.

69    Both sets of counsel relied on the passage in Spry, Equitable Remedies 5th ed (LBC, Sydney, 1997) pp 245-246 and 416 and following.

70 A summons for specific performance was originally classed as being in the auxiliary jurisdiction, that is, that it principally looked to the fact that there was a legally binding contract between the parties, but that the remedy at common law, namely damages, was inadequate leaving equity to grant an efficient remedy. If the contract was no longer recognised at law, then why should it be recognised in equity. This point was made by Stirling J in Firth v Slingsby (1888) 58 LT 481, 483.

71    However, the principal problem is that although there is a 12 year period, from what point of time is the 12 year period assessed?

72    Mr West QC says that the 12 years must run from the breach which was the refusal to perform, which only manifested itself in 1996. Mr Carnovale said that the time would run no later than 1986 when the Council approval lapsed.

73    The onus is on Mr Carnovale. I am not convinced that there was any breach of contract by either party prior to at least 1990. True it is that the Council’s conditions were not met but that appears to have been because of mutual agreement rather than repudiation or breach by either side.

74    Accordingly, in my view the limitation point fails.

75    (2) (g) In view of the decisions I have already made, the issue of part performance is not going to be of real importance for the decision on the land claim, but in case the matter should go further and I be held to be wrong on some earlier findings, I will briefly deal with it.

76    Mr West QC says that this must be one of the plainest cases of part performance the Court has had before it. After the land was agreed to be sold, there was a change of dominion, there was the erection of a fence, there was the laying of concrete strips and Mick did considerable drainage works.

77    As to this, Mr Carnovale says that not all of these works were works which were done solely in performance of the alleged contract. The parties were in a commercial and fraternal relationship; they were adjoining occupiers; they used the disputed strip for their commercial enterprises; they kept the sheds on the strip and work such as the concreting, on the evidence, were attributable to the fact that there was spare concrete left over from their commercial concreting business and it was used to improve the land. Mr Carnovale also points to the fact that the fence was not completely across the land and that the drainage took place on the old boundary.

78 In order to be actual part performance “It must appear that the acts relied on as acts of part performance were done for the purpose and in the course of performing that agreement and with no other view or design than to perform it”: Cooney v Burns (1922) 30 CLR 216, 222. In JC Williamson Ltd v Lukey & Mulholland (1931) 45 CLR 282, 297, Dixon J noted that acts of performance had to be “consistent only with some such contract subsisting” and Smith J said in Francis v Francis [1952] VLR 321, 340, that such acts must point “plainly and not merely in an equivocal fashion, to the existence of an agreement between the parties falling within the general class to which the agreement alleged belongs.”

79 In the instant case, the inter-relationship between the parties in its various facets makes it very difficult to say that what was done on this particular strip of land was done because of the contract and not because of one of the other relationships that the parties had together. I am not satisfied that there sufficient acts of part performance to overcome the problems that are faced by the plaintiffs because of s 54A of the Conveyancing Act 1919.

(3) The Result of the Land Claim

80    Accordingly, the land claim must be dismissed with costs.

(4) The Facts on the Money Claim

81    I now pass to the facts on the money claim.

82    The further amended cross claim by prayer 4A claims $170,582 plus interest. The claim is made on the basis that Frank borrowed moneys from Barclays Bank to fund a joint venture at Merrylands between Fred, Mick and Frank. Frank says that Fred still owes his share of the moneys borrowed. Fred’s defence merely pleads that Frank is not entitled to the relief sought.

83    Frank says that he borrowed $493,000 from Barclays Bank and moneys from other sources to fund the development. He says that he was the only person who had the capacity to borrow and that it was agreed by and between the joint venturers that each co-venturer would indemnify Frank for one-third of the borrowings. Frank says that he, Frank, borrowed $567,731, Mick contributed $215,986, Fred $135,986, a total of $919,705. One-third of this total is $306,568. This amount, less Fred’s contribution, amounts to $170,582.

84    Frank says that this debt came into existence by the end of 1991.

85    Frank says that the understanding was that the only source of funds for Fred to repay him was from the sale of property at Wollongong. Frank says that by 1995 it was clear that Fred would not join in realizing the Wollongong land.

86    Frank said that a meeting was arranged at the office Smith Monti Costa, solicitors, to sign some documents in respect of the Wollongong land, but Fred did not turn up for the meeting. Frank telephoned him and said, “We are waiting, where are you?” Fred said, “I do not want to sell Wollongong any more. I won’t go ahead. I want to leave it to my sons and they can develop it”. Frank said, “Why are you doing this? How will I get my money? You promised I would get it out of the sale”. Fred said, “I am just not selling”.

87    Frank said that later the same evening he and Mick went to see Fred and Frank said to Fred, “What are you going to do to pay me? This land is unsubdividable. We don’t want to keep it.” Fred said, “I will borrow the money on my properties and I will pay you back but I’m not going to sell anything.” Mick said, “Why didn’t you tell us this before?” Fred said “I have changed my mind”. There was then further angry conversation and Frank says he has not spoken to Fred since.

88    Fred says that he never made any agreement to pay Frank, and indeed, did not know how Frank claimed that he was out of pocket. Fred says that there were many dealings between the parties including a project at Hassall Street, Parramatta, where Frank and his accountancy partner at the time, Sergio Laureti, were doing a development and Fred supplied the concrete for which he was paid. Frank, on the other hand, said that the arrangement was that the work being done on Hassall Street was to be done in part payment of the balance owed by Fred on the Merrylands land, but Mr Laureti, by error, paid Fred moneys, about which Frank was very angry.

89    Fred, however, also says that during 1995 and 1996 Frank built a large three level house at 81 Sherwood Road, Merrylands, for himself and Fred supplied the concrete. Fred said that when he was finishing off that job, Mick said, “Do you know that Frank is paying interest on the money he borrowed on your behalf to finish the town houses?” Fred says he said, “What do you mean on my behalf? How much did he borrow? You’ve never mentioned this before”. Mick said, “Because you owe him money for the town houses he does not have to pay you any money for the work on his house”, to which Fred said, “That’s not right. I’ll speak to Frank”. When he did so Frank said he would show Fred what he was talking about, and he came back with two boxes on a trolley, dropped the boxes on the ground and said, “Here you are”. Fred said he replied, “What’s all this? These are just bundles of invoices and other papers. What about proper paper work? You are supposed to write everything down properly” but Frank did not respond and he left Fred’s house.

90    On 1 August 1997, Frank wrote Fred a formal letter of demand for $170,582 plus interest from December 1990, claiming approximately $300,000. He suggested the sale of Unit 11 at Merrylands to permit Fred to liquidate the debt. There was never any answer. Fred says the reason for this was that he never received the letter.

(5) The Issues on the Money Claim

91 Fred’s principal answer to Frank’s claim is that he has never been given a proper accounting, plus he relies on the Limitation Act 1969. However, he also says that he is sure he has already paid his one-third share.

92    Fred’s main reasons for taking this attitude are that he says that Frank has under-credited Fred’s contribution from Bossley Park and that Frank’s borrowings were mainly made for Frank’s own purposes and to make up Frank’s one-third contribution, rather than on behalf of the joint venture. Fred says his own contribution was half of the Bossley Park proceeds, $150,000, rather than $100,000 for which Frank credits him, $80,000 in cash and work done by D’Aroma Concrete.

93    It is really difficult to accept all of Fred’s contentions. A very significant fact is that Fred supplied the title deeds of Fred’s house as part security for Frank’s loan from Barclays Bank. That may be explicable on the basis of kinship, but it does tend to show that Frank’s borrowings were, at least in part, for the joint venture.

94    As to the sale of the Bossley Park land, Frank and Mick say it was sold for $200,000. Fred says it was sold for $300,000, the extra $100,000 not being mentioned in the contract, but being paid over in cash. This cash was taken by Frank and was to be used as part of the capital for the Merrylands project. We do not know the other parties’ view on this as they were never asked.

95    Even if one does work off Frank’s figures, the cross examination shows that they are rubbery. There is, at the very least, $20,000 which is in dispute because of $160,000 in Frank’s account, $20,000 appears to have been used for his own purposes. There is also a further dispute about $25,000 which, in addresses, Mr West QC was prepared to concede, but strangely enough Mr Carnovale did not dispute. Accordingly, even on Frank’s figures, the debt would be somewhere about $150,000, perhaps plus interest.

96 So far as the Limitation Act point is concerned, it is again necessary to find when the cause of action accrued.

97 The Merrylands project was a joint venture, but a joint venture may constitute a partnership; see eg United Dominions Corp Ltd v Bryan Pty Ltd (1985) 157 CLR 1, 15. If the joint venture is a partnership, then the law is that if the partners have ascertained the final balance owing, then on such ascertainment they can sue each other at law: Moravia v Levy (1786) 2 Term Rep 483; 100 ER 260. However, until that balance is ascertained, generally speaking no action at law lies though there is a statutory exception in the District Court under s 44(1)(c) of the District Court Act 1973.

98    In the instant case there has never been any ascertainment of the balance due by agreement, accounts stated or otherwise. Accordingly, no cause of action at law has accrued in so far as an action for debt is concerned.

99    There may be another action on the contract in respect of breach of a term to provide an account, but that will not assist Mick and Frank.

100    Frank has, in at least an annexure to his affidavit, now produced a sort of account. It is not an account which can be dealt with summarily. Ordinarily, the matter should go to the Master with cross examination on the account and the filing of surcharges and falsifications with the Master certifying what is due. The Court would not, without that process, unless by consent, and unless it was able to do so on the evidence, merely fix an amount due.

101    Both sides have urged on me that with the small amount involved, they do not want to go to the Master because of the extra costs involved.

102    I do not particularly want to deal with the final amount due because Frank is not entitled to money but merely to an account, and secondly, the evidence is rather sparse.

103    However, it is clear that there is some dispute as to $45,000 of the amount claimed and indeed a concession that this may not be payable. On the other side, Fred does not really dispute the balance claimed, save that he strongly suspects more of Frank’s borrowings went for Frank’s own purposes, rather than into the joint venture. If one subtracts $45,000 from the amount claimed by Frank, one gets to the sum of $125,582.

104    Frank claims interest. There does not appear to be any agreement for interest in the joint venture so far as the evidence discloses.

105 The joint venture does seem to me to be a partnership because it was an agreement to enter into a business venture, albeit a single business venture, on the basis that profits and losses would be shared equally and capital contributed equally. Section 24(3) of the Partnership Act 1892 provides that where a person has subscribed more than his fair share of capital he is entitled to interest at the rate of 7% from the date where he subscribes more than the others. Frank seems to have paid more than the one-third as at 30 June 1991. The interest on $125,582 at 7% for 9 and three-quarter years is $85,710.

(6) The Result of the Money Claim

106    The only order that should be made on the money claim is that there be a reference to the Master to take accounts with Frank being the accounting party.

107    However, if I were to find, pursuant to some concession and consent, an amount due on the money claim, it would be for $211,292.

108    As to costs, my feeling is that as Fred has succeeded on the land claim, he should get his costs of that claim. With regards to the money claim, unless there is consent to some other course, the only order that could be made is that there be a proper accounting. However, as Fred has virtually conceded that something is due on the accounts, there should be no order for costs until after the account takes place. If, by concession, there is a verdict for the plaintiffs for $211,292, each party should pay their own costs. However, I merely indicate this as my current feeling and am quite willing to listen to counsels’ submissions if they wish to make any.

109    I will thus publish these reasons and stand the matter over to say 24 April at 9.50 am for the purpose of hearing further argument and short minutes. If that time and date is inconvenient to counsel, provided my Associate is contacted no later than 4 pm on 17 April, that date can be changed to one that is more convenient.

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Last Modified: 04/02/2001