Darragh v McDonough
[2009] VCC 105
•25 February 2009
| IN THE COUNTY COURT OF VICTORIA | Revised |
Not Restricted
AT MELBOURNE
CIVIL DIVISION
COMMERCIAL
Case No. CI-08-03416
| JANICE ELIZABETH DARRAGH | Plaintiff |
| v | |
| GLORIA DAWN McDONOUGH | Defendant |
| (As a Natural Person and in Her Capacity as the Exectrix of the Estate of Violet Beatrice Darragh (Deceased)(‘The Estate’)) |
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| JUDGE: | HIS HONOUR JUDGE MORROW |
| WHERE HELD: | Melbourne |
| DATE OF HEARING: | 17 February 2009 |
| DATE OF JUDGMENT: | 25 February 2009 |
| CASE MAY BE CITED AS: | Darragh v McDonough |
| MEDIUM NEUTRAL CITATION: | [2009] VCC 0105 |
REASONS FOR JUDGMENT
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Catchwords: Civil action for the recover of “stolen” monies – fraud – standard of proof – case over twenty years old – Limitation of Actions Act 1958.
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| APPEARANCES: | Counsel |
| For the Plaintiff | The Plaintiff appeared in person |
| For the Defendant | The Defendant appeared in person |
| HIS HONOUR: |
1 In this action, the plaintiff, Janice Darragh, seeks to recover the sum of $73,721, together with interest, from her sister, Gloria McDonough, the defendant, which the plaintiff claims was misappropriated, or, as she said, “stolen” from her by the defendant when the settlement of the sale of the plaintiff’s flat in South Yarra took place on or about the 18th March 1987. That allegation is denied by the defendant.
2 Neither party was represented but they each tendered Court Books, and I have accepted the plaintiff’s Court Book (“PCB”) as Exhibit A, and the defendant’s Court Book (“DCB”) as Exhibit 1.
3 At the hearing, the plaintiff sought to put her case by way of an affidavit which was sworn on the 16th February 2009 (the plaintiff’s affidavit), and which I have added to the PCB following page 212. The plaintiff gave evidence on oath and swore that the contents of her affidavit were true and correct and she gave other evidence and relied on the various documents in her Court Book. The only other witness was the defendant, who also gave evidence on oath and relied on the documents in her Court Book.
4 The Plaintiff’s Court Book and her affidavit contained much inadmissible material, including hearsay and other material that was irrelevant. However, I have confined myself to the admissible material.
5 My task of deciding this case was made more difficult because due to the effluxion of time many of the records of various solicitors and banks and documents at the Titles Office were either lost or destroyed over the past twenty odd years. In addition, the memory of both parties could not be reliable now as would be the case, twenty years ago.
6 Needless to say, the defendant pleaded the statute of limitations as part of her Defence (paragraph 17 of the Defence at PCB 13). More of this later.
7 The plaintiff gave her occupation as a paralegal and student, and apparently first worked for solicitors in London in the 1960s and 1970s and has since, at one time or another, worked for the firm of Herbert Geer & Rundle (“H, G & R”), solicitors in Melbourne.
8 The defendant’s occupation had been that of a secretarial nature with the Department of Human Resources for approximately twenty years, and in particular, she worked in the division of that department that was concerned with aged care. She said in evidence that over the years of her marriage from the 1970s through to the present time, her and her then husband had bought and sold some three or four houses, and in those transactions she had employed solicitors when purchasing, but that she and her husband have acted for themselves when they were selling.
9 The following matters do not seem to be in dispute:
10 The mother of the parties, Violet Beatrice Darragh, died on the 16th December 1985. The defendant was her eldest daughter, and the plaintiff, her second child. A third daughter, Marianne Joyce Darragh, the youngest daughter, is now deceased.
11 On the 27th May 1977, Mrs Violet Darragh executed a Will, a copy of which is to be found at PCB 28. In that Will, Mrs Darragh appointed the defendant as executrix and trustee of her Will, and apart from a bequest of $3000 to the defendant’s then husband, Barry McDonough, the rest of Mrs Darragh’s estate was to be divided equally between her three daughters.
12 Prior to the death of Mrs Darragh, she was living at 311 Barkly Street, Elwood (“Barkly Street”) with the plaintiff and her young son, Scott, her other daughter, Marianne, and her young daughter, Skye.
13 As I understand it, the Barkly Street property had been Mrs Darragh’s matrimonial home and when she and her husband divorced in 1977, she became the sole proprietor of the property but it was subject to a mortgage with War Service Homes.
14 The plaintiff’s evidence was that in September or October 1985, she had discussed with her mother about buying a flat or unit in South Yarra as an investment property. The plaintiff said that her mother offered to re-mortgage the Barkly Street property and give the money to the plaintiff towards the purchase of Unit 1, 56 Leopold Street, South Yarra (“the South Yarra property”). As I understand it, the sum of $85,000 was borrowed from H, G & R, and after the mortgage to War Service Homes was paid off and Mrs Darragh was given $4000 for her own use, the balance of some $67,000 was “given” to the plaintiff towards the purchase of the South Yarra property. The plaintiff does not dispute that these matters were never told to the defendant, who apparently was a frequent visitor to the Barkly Street property and had her own key.
15 The plaintiff insists that the mortgage monies were a gift from her mother because she said her mother had been grateful for the assistance that the plaintiff had given her when the divorce proceedings took place between the plaintiff’s parents in 1977. She insisted that the mother had not lent her the money, and when I asked her how the mortgage to H, G & R was to be repaid, she said that she paid her mother some $250 a week rent at Barkly Street and that would have been sufficient to cover the mortgage repayments. It would seem in fact that Mrs Darragh died soon after the mortgage from H, G & R was obtained.
16 In evidence before me, the plaintiff said, “I was to pay off the mortgage on Barkly Street”. This was after her mother had died and before the estate was wound up. The plaintiff said that she discussed this with the defendant and the defendant told her not to make the mortgage payments, that she would take charge, and she said then the payments fell into arrears. She then referred me to PCB 48.
17 A copy of the Certificate of Title for Barkly Street is to be found at PCB 174. That shows that the mortgage to War Service Homes was discharged on the 29th November 1985 and the mortgage to H, G & R was registered on the 29th January 1986.
18 The plaintiff produced no documents in relation to the purchase of the South Yarra property and she did not say precisely when she entered into any contract of purchase, or indeed what the purchase price was, but a copy of the Certificate of Title for that property is at PCB 72. That shows that the plaintiff was registered as the proprietor on the 24th February 1986 and a Mortgage by RESI Building Society was registered on the Title on the same day. The plaintiff said that in addition to the monies coming from her mother, she needed finance from RESI in order to buy the South Yarra property.
19 In paragraph 4 of her said affidavit, the plaintiff said that “following the purchase of the South Yarra property, I did a land title search to confirm the RESI Building Society mortgage had been registered and I was the sole registered proprietor”.
20 Following Mrs Darragh’s death, the defendant said that she found her mother’s Will in her bedroom at Barkly Street and she said that she had been told by her mother that she was to be the executrix of the estate, but that she had never been shown a copy of her mother’s Will and did not know what the dispositions were to be.
21 The defendant said that she then went to the solicitors who had prepared her mother’s Will, Messrs Doolan Kemp & Townsend, to obtain probate for her mother’s estate, and the Certificate of Title for Barkly Street shows that she was registered as the proprietor (as executrix) on the 9th May 1986 (PCB 174).
22 The plaintiff said in evidence that she told the defendant about the mortgage over Barkly Street with H, G & R, and that her mother had given her the money so that she could purchase the South Yarra property.
23 Thereafter, there is a complete divergence in the evidence of the plaintiff and defendant in relation to the subsequent conversation. The plaintiff would have it that she told the defendant that the money had been a gift to her and that the defendant replied with words to the effect that notwithstanding what the plaintiff was saying, she, the defendant, was insisting that the plaintiff pay off the mortgage to H, G & R prior to the distribution of the estate.
24 It should be noted that by this time it is agreed that the plaintiff was saying that she did not wish to continue living at Barkly Street with her younger sister, Marianne, who, unfortunately, had problems with drug addiction and alcoholism. The plaintiff said to the defendant that she would not renew the lease on the South Yarra property to the tenants who she had obtained after purchasing that property, and intended to live in it herself.
25 The defendant’s version of the conversation concerning the mortgage from H, G & R was that the plaintiff acknowledged that she would be responsible for the discharge of the H, G & R mortgage. It is common ground that the plaintiff in fact made some three or four payments on the mortgage to H, G & R up to approximately February 1986. The defendant said the plaintiff told her that their mother had lent her the money.
26 It is not in dispute that it was agreed between the parties that as soon as the defendant was able to obtain probate of her mother’s estate, that the Barkly Street property would be sold.
27 Messrs Doolan Kemp & Townsend duly arranged for the probate of the estate to be carried out, and, as I have said, the defendant was registered as the proprietor of Barkly Street on the 9th May 1986.
28 The defendant then arranged for real estate agents to sell the property and it would appear that Messrs Doolan Kemp & Townsend were to act for the estate in the sale of Barkly Street. I note that Messrs Doolan Kemp & Townsend no longer have any records in relation to this matter, they having destroyed their files after a period of seven years, as per their letter of the 15th January 2008, at DCB Volume 2, page 185. DCB Volume 2 contains a considerable amount of correspondence between the defendant and various solicitors, banks and other bodies which reveals that their records no longer exist. The only documentation that there is in relation to the sale and the discharge of the H, G & R mortgage over Barkly Street appears to have come from H, G & R and is contained in DCB Volume 2, beginning at page 208. By letter dated the 14th May 1986, Messrs Doolan Kemp & Townsend wrote to H, G & R in the following terms:
“We refer to prior correspondence in this matter. We advise that the property at 311 Barkly Street, Elwood has now been sold by the executrix of the estate of the late Mrs Darragh, and final settlement is due by the 17th July 1986. We shall be pleased if you will prepare a discharge of mortgage with H G & R Nominees Pty Ltd and let us know at your earliest convenience, the amount required to discharge the mortgage on settlement.”
29 By letter dated the 20th May 1986 (DCB Volume 2, page 209), H, G & R replied and stated that the amount required to discharge the mortgage on the 17th July 1986 was $89,837.73. That sum included the principal of $85,000.00, together with interest and penalty interest and legal costs and fees of $4,837.73. Other documents surrounding this figure are at DCB Volume 2, page 210 and 212. At DCB Volume 2, page 213 is a copy of a request for a trust receipt. This document notes that:
“Received from the estate of V B Darragh deceased.
Drawer: Bank Cheque
Bank: NAB Branch: 85 Queen Street.”
30 The receipt is for a total of $89,880.81 and it is dated the 18th July 1986. A memorandum of H, G & R’s professional costs is to be found at page 214 of that volume.
31 A copy of the Transfer of the Barkly Street property is to be found at PCB 167. This shows that the property was transferred to one Bert Canestra on the 18th July 1986 for the sum of $185,000 and the Transfer was lodged by his solicitors, Messrs Mahoney, Galvin & Rylah.
32 The defendant insists that in fact it was the plaintiff who paid the sum of $89,000 odd to Messrs H, G & R to discharge their mortgage over the Barkly Street property and the plaintiff contends that the monies for the discharge of the mortgage came out of the proceeds of sale to Mr Canestra. The defendant submits that notwithstanding that Messrs Doolan Kemp & Townsend were the ones making the enquiries as to the amount required to discharge the mortgage, the funds were not in fact coming from the estate but from the plaintiff.
33 It is the defendant’s evidence that following the sale of Barkly Street, and after the payment of various expenses in connection with the estate and a bequest to her former husband of $3000, there was a sum of $169,276.71 to be distributed equally between the three daughters of the deceased, meaning they each received $56,425.57, and the defendant insists that this distribution was made in August of 1986. Details of the defendant’s administration of her mother’s estate are set out in paragraph 11.2 of her Defence (PCB 9). When giving evidence, the defendant insisted that the distribution of the estate took place in August of 1986.
34 At paragraph 11.2 of the Defence, the defendant has given details of the administration of the estate, including a payment to “RESI” on 18 July 1986 of some $9,000. The defendant said, when giving her evidence, that she had no documentation in relation to this, but she could remember, that after the settlement of the Barkly Street property her bank manager had told her that he had an invoice for a figure which he said was less than $10,000 and probably the $9,000 that she included in the particulars, and she understood from what the bank manager said that the plaintiff had paid this item. She said, when she was told this, she agreed that the plaintiff should be repaid. Hence, that amount came out of the estate prior to the balance being distributed. It should be borne in mind that, by this stage, the plaintiff had purchased the South Yarra property with the aid of a mortgage from RESI, but otherwise I am not in a position to draw any inferences from this evidence, which is largely hearsay, save to say that it goes to the defendant’s credit that she raised the matter.
35 The plaintiff contends that in fact the distribution of the estate took place in March of 1987 following the sale of the South Yarra property by the plaintiff. In paragraph 12 of her Statement of Claim, the plaintiff said that the defendant paid out the sum of $53,000 to her and her younger sister in March of 1987.
36 The resolution of the question as to when the distribution of the estate occurred is of some importance in relation to the plaintiff being able to prove her case. If in fact the distribution occurred in August 1986 of a sum of at least $53,000 each, then it is clear that the H, G & R mortgage over the property was discharged, not by the estate but by the plaintiff because otherwise there simply would not have been funds of that magnitude to distribute amongst the three beneficiaries. It is the plaintiff’s case that the distribution occurred in March 1987 and that the reason that the defendant was able to pay out at least $53,000 to each beneficiary was because she had taken $100,000 out of the settlement monies of the plaintiff’s sale of the South Yarra property.
37 The defendant points out that when one looks as the trust account receipt (DCB Volume 2, page 213), the relevant cheque came from the National Australia Bank. The defendant says that this is a bank with whom the plaintiff has had a long association, and she refers to various bank statements contained in the plaintiff’s Court Book from that bank. The defendant says that on the other hand the estate and her bank was the ANZ, and she asked me to infer that the money came from the plaintiff. It may well have, but I am unable to draw that inference on that evidence because the bank cheque to discharge H, G & R’s mortgage on settlement may well have come from the purchaser of the property. The common practice is for the vendor’s solicitors to tell the purchaser’s solicitors as to how the bank cheque or cheques on settlement are to be drawn up and in whose favour.
38 Before turning to the settlement of the South Yarra property, it should be noted that it is common ground that following the plaintiff and defendant’s decision to sell the Barkly Street property, the plaintiff moved to premises in Mozart Street, Elwood with her son, and I refer to the list of premises that she drew up which is at PCB 134. As I understand it, the plaintiff was living at Mozart Street up until the time that she sold the South Yarra flat.
39 A copy of the Title of the South Yarra property is, as I have noted, at PCB 72. This document shows that a Caveat Number M455718 was lodged over the Title of the property on the 2nd September 1986.
40 The plaintiff said that the property was sold at auction and was in fact purchased by the tenants, Biggs & Wilmot, who were registered as the proprietors of the property on the 19th March 1987. The mortgage over the property (by RESI) is shown to have been discharged on the 18th March 1987 and the Caveat, to which I have referred, was withdrawn on the following day. A copy of the Transfer of the South Yarra property is at PCB 73, and that shows that it was dated on the 27th February 1987 and was lodged by Messrs F E O’Brien, Solicitors, and the consideration is shown as $175,000. Enquiries by both parties at the Titles Office, as can be seen from the Court Books, shows that the relevant Caveat has been destroyed (PCB 78).
41 The plaintiff gave evidence that she acted for herself in the sale of the South Yarra property and that prior to the sale she discussed it with the defendant. I might add that the plaintiff had given evidence that following a discussion in February 1986 between her and the defendant, where she said that their mother had gifted her the monies from the mortgage over Barky Street, and that this revelation had caused animosity between them, she nevertheless admitted that she was on good terms with the defendant. The plaintiff said that the sale of the South Yarra property took place in December of 1986 and that she asked the defendant to attend the auction and to put in dummy bids. The defendant agreed that she had been so requested and that she did attend, and the plaintiff said that prior to the settlement day of the South Yarra property, the defendant called into her home and enquired as to whether the plaintiff was going to attend the settlement of the South Yarra property. The plaintiff said that she told the defendant that she was very busy at work and had faxed a letter of instruction to the RESI Building Society asking them to act as her agent at the settlement and settle the property on her behalf. She said that she instructed RESI to bank the net proceeds into her loan account with them.
42 In paragraph 13 of her said affidavit, the plaintiff said:
“It was about a fortnight after the settlement day of the South Yarra property when I telephoned RESI and requested my loan account to be closed down, and RESI forwarded me the balance of my loan account which I anticipated to be approximately $112,500. A few days later a cheque arrived from RESI in the sum of approximately $12,500. I telephoned RESI and stated I wanted the full balance of my loan account. The girl who spoke to me said, ‘That was the full balance of the account’. She continued that there had been a caveat over the property. I telephoned the defendant and said, ‘You took my money’. I demanded the immediate return of all my proceeds of sale. The defendant, replied ‘bad luck’.”
43 Thereafter, the plaintiff gives, in that paragraph, various reasons as to why she did not confront the defendant at her residence, none of which I thought were believable, and then, in that paragraph, the plaintiff says:
“On the following Monday morning I went into the RESI to be told the loan folder had been lost and they could not help me. I have contacted RESI on numerous occasions but the folder has never been located.”
44 Thereafter, the plaintiff says, in that paragraph, how she went to the Titles Office and requested the folder in respect of her property, and she said:
“The folder did not contain the RESI Mortgage, the Caveat or the Withdrawal of Caveat. All documents relating to my loan had disappeared from the folder. I attended the LTO on numerous occasions but the documents never reappeared.”
45 She then says:
“I attempted to contact the purchaser’s solicitor, Mr O’Brien, without success. I wanted copies of the statement of adjustments and the settlement statement and any correspondence regarding payout and return for a withdrawal of caveat. I was informed he was ill and his secretary said she had no authority to go through files or send documents out. Mr O’Brien was hospitalised and died. I was informed his practice was sold to Septimus, Jones & Lee, Solicitors. I contacted them numerous times but was always thwarted from getting correspondence and documentation.”
46 The plaintiff asks me to infer from this material that the defendant lodged a Caveat on the South Yarra property on the 2nd September 1986 and that the plaintiff was completely unaware of this lodgement. She asks me to infer that the defendant turned up at the settlement of the South Yarra property and that she produced the Caveat and was able to persuade (presumably the purchaser’s solicitors) to give her a cheque for $100,000 in return for the withdrawal of the Caveat.
47 This seems to me to be an incredible scenario. Given that the plaintiff was acting for herself in relation to the sale of the South Yarra property, she would have been communicating with Messrs F E O’Brien & Co., the solicitors for the purchasers. Documentation, such as the Contract of Sale and Requisitions on Title and Answers thereto must have passed between them, as well as arrangements for the actual settlement. It would have been the plaintiff that would have told Messrs F E O’Brien & Co. what cheques were needed at settlement in order to discharge the RESI mortgage. There must have been discussion over adjustment of rates and other outgoings et cetera, and further, the plaintiff must have told Messrs F E O’Brien & Co. where the actual settlement was taking place. Most importantly, Messrs F E O’Brien & Co., in acting for the purchasers, would have no doubt searched the Certificate of Title and found that there was a caveat over the Title and would have made enquiries with the plaintiff about the caveat. It is simply unbelievable that the plaintiff did not find out about the caveat until after the settlement.
48 In paragraph 7 of her said affidavit, the plaintiff says that whilst living at Barkly Street, the defendant had free access to the Barkly Street house, that the defendant had taken mail from that house that was addressed to her. In paragraph 7, she said she arrived home “one day” and found her in the kitchen with the post. When I asked the plaintiff whether she had ever seen the defendant open letters that were in fact addressed to the plaintiff, she said she had not. In the same paragraph, she goes on and says:
“I did not receive mail from the purchaser’s solicitor informing me of the Caveat, the necessity for a withdrawal of caveat for settlement and the Amended Statement of Adjustments and Settlement Statement. It was the usual practice of that particular solicitor (presumably F E O’Brien & Co.) to post correspondence. He did not use the facsimile machine to forward correspondence. Further, I did not receive the notice mailed to me by the Land Titles Office informing a Caveat had been lodged over the South Yarra property. The defendant removed those letters from the Barkly Street property.”
49 The problem with this scenario is, leaving aside for the moment that the defendant has denied that she ever interfered with the plaintiff’s mail at Barkly Street, is that at the time the plaintiff was selling the South Yarra property she was no longer living at Barkly Street. By her own admission, she was living at Mozart Street and had left the Barkly Street property long before, and indeed, as I have already said, that property was sold in July of 1986. Even assuming for the moment that somehow the defendant had intercepted all of this correspondence from F E O’Brien & Co., it beggars belief that prior to the settlement that the plaintiff would not have contacted F E O’Brien & Co. by letter or by phone to enquire about what was happening in relation to the settlement. Further, assuming for the moment that the defendant had planned to turn up at the settlement with a withdrawal of caveat in return for $100,000, she would have had to have been sure that the plaintiff was not going to attend herself. According to the plaintiff, she only decided herself not to attend the settlement because she was “busy at work”. Had in fact the plaintiff turned up at the settlement, then the defendant’s carefully crafted plans would have all fallen in a heap. In order to succeed, the defendant would have had to have convinced F E O’Brien & Co. to turn up with a cheque made out to the defendant in the sum of $100,000 in return for the withdrawal of caveat.
50 Further, I would have thought that the plaintiff would have contacted RESI on the day of the settlement to see whether or not the settlement had indeed taken place as planned, and that the balance of the purchase monies, after paying out the RESI loan, had been deposited in her account. I simply do not believe, as the plaintiff contends, that she waited for a fortnight after the settlement before making a telephone call, and I do not believe that she simply accepted that RESI had simply lost all of the documents surrounding the settlement.
51 There is not one shred of evidence that the defendant attended on the Titles Office and illegally removed documents from the folder containing the plaintiff’s Title to the South Yarra property. I am simply asked to infer that the documents were removed from the folder in furtherance of the conspiracy initiated by the defendant to obtain the $100,000 that the plaintiff accuses her of misappropriating at the settlement. I might add that the defendant has denied that the plaintiff telephoned her following the settlement or that she ever threatened the plaintiff with contacting Protective Services when she raised the question of “the stolen proceeds” (as alleged in paragraph 13 of the plaintiff’s affidavit). I simply do not accept any of these allegations which concern not only the plaintiff but her sister, Marianne, and on the other hand I accept the defendant’s evidence concerning these matters.
52 In general, I found the defendant to be an impressive and reliable witness. Her evidence was cogent, rational and she made appropriate concessions. The plaintiff, on the other hand, had to rely essentially on the drawing of inferences without any substantial foundation in order to make her case. The defendant could have simply relied on the plaintiff trying to prove her case, but instead, as her Court Book shows, she went to considerable lengths to try and collect evidence from solicitors, banks, building societies and the Titles Office to substantiate her position.
53 It seems truly amazing to me that following this alleged theft, all of those concerned with the settlement, i.e., RESI and Messrs F E O’Brien & Co. and the Titles Office, were unable to find documents, or speak to the plaintiff about the settlement.
54 When it comes to the drawing of inferences, it seems equally open to me that the Caveat that was lodged over the plaintiff’s South Yarra property in September of 1986 was done to secure further monies advanced to the plaintiff by persons unknown. However, I do not in fact draw that inference. I am content to say that the plaintiff has completely failed to prove her case. The plaintiff acknowledged that she had the burden of proving her case, and given that her case is essentially one of fraud on the defendant’s part, the standard of proof is higher than simply the balance of probabilities, to which I will refer later.
55 Before leaving the subject of a caveat, I note that the plaintiff gave evidence that in September of 1986 she requested a loan of $700 from the estate but the defendant said that she would lend the plaintiff the $700 out of her own monies rather than from the estate. The plaintiff said that the defendant insisted on this loan being evidenced by a written agreement. She claimed that in fact she paid the money back within six weeks and that the defendant had used this written loan agreement to lodge a caveat against the plaintiff’s South Yarra property. The defendant’s evidence on this topic was that in August 1986, after the plaintiff had got her cheque on the distribution of the estate, the plaintiff rang her and asked her for $700. The defendant said, “I asked the plaintiff why, and she replied that, ‘I just need it’.” The defendant said she agreed to lend the plaintiff the money but that she wanted it in writing, and as a result she said the plaintiff took her to her [the plaintiff’s] solicitors and they drew up an agreement, and after that the defendant transferred the money out of her account to the plaintiff. She said that the money was repaid and it was probably after the sale of the South Yarra property and she thought it was in cash. She denied that she had ever put a caveat over the South Yarra flat in relation to this or any other transaction and that she had had no solicitors acting for her at the time and that she had not instructed the plaintiff’s solicitors to put a caveat over the property. I would have thought it was strange or indeed unusual for a caveat to be placed over someone’s property to protect a loan of some $700 but in any event I am not prepared to draw any inferences from the lending of the $700 which would lead me to conclude that the defendant placed the subject caveat over the plaintiff’s property.
The Defence under the Statute of Limitations
56 As far as delay is concerned, in paragraphs 25 and 26 of her said affidavit, the plaintiff goes into some detail as to why she has not brought her action before now. In addition, the plaintiff gave evidence that whenever she went to solicitors, they insisted on being provided with the various relevant documents, and required funds before proceeding which the plaintiff simply did not have. In paragraph 26, the plaintiff says that in 1987 the defendant embarked on an elaborate scheme to lure her out of her house so that the defendant could break into the house and steal the plaintiff’s documents. There is not one shred of evidence to support this allegation. I would have thought that if, indeed, the plaintiff had a box containing personal papers “including correspondence and documentation concerning my properties and the estate”, then it seems strange that she had not used these documents to further her claim against the defendant, which she said she intended to make as soon as she discovered that the defendant had stolen her money. In evidence, the plaintiff said that, over the years, she had kept demanding money from the defendant who had refused to comply with her demands and that, in effect, she had never wavered in her believed that the defendant had stolen her money.
57 The plaintiff was referred to paragraph 14.4 of the Defence, which asserts that between 1987 and 1999, the plaintiff and the defendant endured “a civil sibling relationship”. The defendant gave particulars, including the fact that the plaintiff and the defendant celebrated special family occasions together, shared holidays and, in paragraph 14.5, discussed the purchase of a property together, which did not go ahead. The defendant said that when she pulled out of the proposed purchase, the plaintiff was angry with her. In paragraph 14.6, the defendant said that on 11 April 1997, the plaintiff and her son moved in to live with the defendant at her home in East Bentleigh and, again, in February 1998, after the plaintiff’s childcare business failed, the plaintiff and her son again returned to live with the defendant. In paragraph 14.10, the defendant says that the plaintiff’s attitude towards her changed after the failure of the plaintiff’s business and the plaintiff directed her anger at this failure towards the defendant and that continued until Christmas Day 2003 when the plaintiff chose to be verbally aggressive towards the defendant at Christmas dinner, whereupon the defendant asked the plaintiff to leave her home. The parties have been at arm’s length since that time. These matters were put to the plaintiff and she admitted that these events had occurred and she conceded that she had become angry and, in fact, blamed the defendant for the fact that the proposed joint purchase of a property did not go ahead. She said that her attitude “turned to hatred” and that she “harboured a resentment against the defendant for a long time”.
58 I do not accept that any of these matters would provide the plaintiff with grounds for arguing that the statute of limitations would not apply to her claim assuming that s.27 of the Limitation of Actions Act 1958 applies. That section provides that any action “based upon the fraud of the defendant” is one where the period of limitation “shall not begin to run until the plaintiff has discovered the fraud”. The fact is, however, on the plaintiff’s own evidence, that she did discover the fraud, i.e. the misappropriation of her money, immediately after the event. In the circumstances then, the statute is applicable and, in the circumstances, I find that the plaintiff’s case is statute barred, under this Section.
59 S.21 of the Limitation of Actions Act 1958 provides that the statute does not run in an action by a beneficiary under a trust in respect of any fraud or fraudulent breach of trust to which the trustee was a party or privy or to recover from the trustee, trust property or the proceeds thereof in the possession of the trustee, or previously received by the trustee and converted to his use: (see subsections (1)(a) and (b) of s.21). It seems to me that this section has no application to this case because the defendant was not a trustee in relation to the plaintiff’s South Yarra property. Assuming for the moment that the defendant did turn up at the settlement of that property and steal or misappropriate $100,000, it was from the plaintiff, as owner of that property, and not the plaintiff as a beneficiary in the mother’s estate.
60 However, if I am wrong about this and the plaintiff’s action is not statute barred, then, as I have noted above, I find that the plaintiff has failed to prove her case. Allegations of the type that the plaintiff has made against the defendant in this case are serious and need to be proved upon sound admissible evidence. The law says that where in a civil proceeding, the question arises whether a crime has been committed, the standard of persuasion is on the balance of probabilities but weight must be given to the presumption of innocence and the exactness of proof. Clear and cogent evidence must be called by the party making the allegation in keeping with the gravity of the allegations made even though ultimately the case is to be judged on the balance of probabilities.
61 Clearly, the plaintiff has not produced that standard of evidence which is required to prove her case given the seriousness of her allegations. However, I would not like the plaintiff to think that she has lost her case as a result of any legal technicalities. Even if I put to one side the standard of proof required in a fraud case, it seems to me that the plaintiff has demonstrably failed to prove her case even on an “ordinary” balance of probabilities standard.
62 The plaintiff’s claim will be dismissed.
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