Dimento v Dimento & Anor

[2007] NSWSC 1191

CITATION:	Dimento v Dimento & Anor [2007] NSWSC 1191
HEARING DATE(S):	2-4 October 2007
JURISDICTION:	Equity Division Expedition List
JUDGMENT OF:	Brereton J
EX TEMPORE JUDGMENT DATE:	5 October 2007
DECISION:	There was a binding and enforceable contract to convey the licences beneficially, which had not been terminated or abandoned. The vendor was not beneficially entitled to the licences. Specific performance refused. Vendor is entitled to proceeds of sale of real property. Purchaser is entitled to damages for breach of contract.
CATCHWORDS:	CONTRACT – General Contractual Principles – Construction and Interpretation – where sons contract for transfer by one to other of fishing licences in return for transfer by other to first of interest as co-owner with first of real property - whether intention to convey legal title to licences only or beneficial interest – Discharge - whether agreement terminated - whether agreement abandoned - whether specific performance should be decreed - whether damages should be awarded. - EQUITY – Equitable estates and interests - fishing boat and fishing licences – where father and sons informally agree to participate together in fishing venture – where venture subsequently carried on under structure of partnership and then company – where boat in name of sons and licences variously in name of one or both sons – where father contributes funds and draws on business income – whether father or company retains beneficial interest. - EQUITY – Equitable remedies – Specific performance – defences to specific performance - impossibility – where defendant not beneficially entitled to subject matter of contract - where enforcement would require defendant to act inconsistently with prior equitable obligations
LEGISLATION CITED:	Conveyancing Act, s 37A
CASES CITED:	Colyton Investments Pty Ltd v McSorley (1962) 107 CLR 177 Commonwealth of Australia v BIS Cleanaway Limited [2007] NSWSC 1075 DTR Nominees Pty Limited v Mona Homes Pty Limited (1978) 138 CLR 423 Fitzgerald v Masters (1956) 95 CLR 420 Neeta (Epping) Pty Ltd v Phillips (1974) 131 CLR 286 Seawall v Webster (1859) 29 LJCh 71
PARTIES:	Giacomo Dimento (plaintiff) Guiseppe Dimento (first defendant) Francesco Dimento (second defendant)
FILE NUMBER(S):	SC 4545/05
COUNSEL:	D M Flaherty (plaintiff) M R Pesman (first defendant) J E Rowe (second defendant)
SOLICITORS:	Mullick & Associates (plaintiff) Lloyd & Lloyd (first defendant) John Carmody & Co (second defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
EXPEDITION LIST

BRERETON J

Friday, 5 October 2007

4545/05 Giacomo (Jim) Dimento v Guiseppe (Joe) Dimento & 1 Or

JUDGMENT (ex tempore)

1 HIS HONOUR: From 1963 the second defendant Francesco Dimento – to whom, for sake of convenience and without intending any discourtesy, I shall refer as Frank – operated fishing vessels, under licences held by him, on and from Sydney Harbour. In 1978, Frank had a back operation and in 1979 he was granted a disability pension. From 1980, he operated the fishing vessel Tiger under licence, employing a skipper and crew to do so on his behalf. Frank's elder son, the first defendant Guiseppe Dimento – to whom I shall similarly refer as Joe – left school in 1983, at the age of 13, and commenced to work with Frank on the Tiger. In about early 1992 there were a number of discussions between Frank, Joe (who was then aged about 21), and Frank's younger son, the plaintiff Giacomo Dimento – to whom I shall refer as Jim – who was then in his School Certificate year at school, and aged about 16. At least at some stage in the course of those discussions, Frank's wife Maria, and their daughter Teresa, were involved, albeit not as principals.

The 1992 discussions

2 The recollections of each of the witnesses of those discussions vary. On any view, the parties discussed buying a larger fishing vessel to fish off the New South Wales coast rather than just in the Harbour. They discussed, and apparently agreed, that the vessel would be purchased in the name of Joe and Jim and that this venture would enable Joe and Jim to get a start in the fishing industry.

3 Frank says that he stipulated that although the licences would be in Joe's name, they were to remain, in reality, his own property, at least so long as he lived, and would then pass to Joe. In one of his versions, Frank also stipulated that though the vessel would be held in the name of Jim and Joe, he would remain the real owner, at least for the rest of his life.

4 Maria's version is substantially consistent with Frank's, although she uses the words "we" rather than "I" to describe who was to retain “real” ownership of the vessel and licences, leaving scope for a somewhat wider view.

5 Teresa does not record any particular reservation of “real” ownership, but attributes to Frank a statement to the effect that he was putting the licence in Joe's name, and the boat in the names of both boys, because he was getting a disability pension.

6 Joe's version does not attribute to Frank any particular reservation of “real” ownership, but asserts – which appears to be common ground – that something was said about the living expenses and house bills of Frank and Maria’s home would be paid out of the business income.

7 Jim, in his affidavits, denied all of these versions, but while conceding that there were discussions, did not advance any version of them. He eventually did so in his oral evidence, when he said that his father wanted a bigger boat, and that he (Jim) then wanted to become a fisherman:

My father had a small boat and wanted to get a bigger boat. “We're making good money at the moment. Let's give it a go”. That's what my father said.

8 Jim also attributed to his father:

It sounds like a good idea if you are serious about being a fisherman. Let's look at buying a boat.

9 At this period, Jim said, "All four of us were involved in looking at buying a boat at that time during that period". He said that so far as there was talk about ownership of the boat, the owners were to be him and Joe equally, and that the licences were going to be in Joe's name, “but I was equally shareholder of this. My father promised that would happen. So long as he lived, the boat and the licence would equally be my and my brother's, does not matter whose name was on them”.

10 Jim said that so far as he understood, his father never had any right or interest in the boat or the licences. I will have to return to these conversations in due course.

The Kimbarra Fishing Partnership

11 On 26 May 1992, Frank and Joe jointly obtained an overdraft from Westpac with a limit of $70,000, secured by mortgage over Frank and Maria's home. Frank borrowed a further $30,000 from his sister, and $20,000 from his wife's cousin; together, this accumulated funds of some $120,000 in all. On 8 July 2002, the vessel Kimbarra was purchased in the name of Jim and Joe for a price of $80,000 funded by the overdraft, the loans to which I have referred and some savings that Joe had accumulated of about $16,000. Although Jim contends that he contributed about $5,000 – said to have been accumulated from savings from his Austudy receipts – I am unable to accept that he made a significant financial contribution at that stage, although I accept that he made some slight contribution from his Austudy income. On 17 August 1992, Jim and Joe became the registered owners of the Kimbarra.

12 Although there is no documentary evidence of it, it seems that at about this time the State fishing licence FL78172 was acquired in the names of Jim and Joe, for a price of $25,000. Initially, an application for transfer of Commonwealth fishing licences, formerly held one John Gordon, was made on 17 July 1992, and after some technical problems with the completion of the transfer, by 11 March 1993 Mr Gordon's Commonwealth fishing licence had been acquired in the name of Joe and attached to the Kimbarra. In 1994 to 1995, additional Commonwealth fishing permits were obtained and attached to the Kimbarra. According to Frank, and there is no other evidence on the topic, the Commonwealth licence was acquired at a cost of $20,000 or $25,000.

13 The fishing business was carried on under the trade name Kimbarra Fishing, initially as a partnership between Joe and Jim. The partnership's financial statements for 1994, which seem to be the first partnership statements, and cover the twelve months from 1 June 1993 to 30 June 1994, record as assets of the partnership, “Plant and equipment – boat: $86,500”, and “Intangibles – goodwill: $25,000”. It is therefore quite clear that the boat was brought into the partnership accounts as an asset of the partnership. And, despite submissions to the contrary, it also seems quite clear that the goodwill intangible of $25,000 is a reference to the $25,000 paid for the State fishing licence, and that the State licence was thus brought into the accounts of the partnership. In the partnership accounts for the year ended 30 June 1995, the intangibles increased from $25,000 to $45,000. In the light of the evidence of Frank that $20,000 or $25,000 was paid for a Commonwealth licence, I infer that the increase in intangibles represents the Commonwealth fishing licence at cost. Accordingly, as it seems to me, not only the boat, but also the State and the Commonwealth licences, were bought into the books of the partnership and treated by the parties as partnership assets.

14 From the outset, the partnership traded on an overdraft account. It is common ground that Frank was permitted to draw on that account, and did so for the purpose of his and Maria's household and living expenses. This continued at least until 2002.

15 It appears that, on 23 February 1995, Joe requested that the Commonwealth licence, which until that time was in the names of Jim and Joe, be transferred to Joe alone, and Jim joined in that request on 7 April 1995. Then, in February 1996, the Commonwealth permits were apparently transferred into the name of Joe and Jim.

Incorporation – Dimento Pty Ltd

16 At some stage, probably during 1995, advice was obtained from an accountant that it would be more effective to structure the business as a company, and on 29 June 1995, Dimento Pty Limited was incorporated, with Frank, Maria, Joe and Jim as shareholders and directors. On 20 December 1995, the loan arrangements with Westpac were revised, and in place of the overdraft in the name of Frank and Joe, was substituted an overdraft in the name of the company, with the same limit of $70,000, supported by guarantees from Frank and Maria and the existing security over Frank and Maria's home. After the incorporation of the company, Frank continued to draw household and living expenses for himself and Maria from the company’s overdraft account.

17 The first set of the accounts for the company are those for the year ended 30 June 1996. The 1995 partnership returns, as I have said, recorded intangible goodwill $45,000, and property, plant and equipment totalling about $60,000. The first set of accounts of the company record plant and equipment at $115,000 and a further $9,000 for motor vehicles and, in addition, intangibles of $45,000. In my view, the inference is compelling that the licences, which had previously been treated as assets of the partnership, were then treated as having been transferred to the company and are represented by the intangibles of $45,000. The company claimed depreciation on the boat, and although the accounts do not show the break up of the plant and equipment, I infer the plant and equipment in the company accounts include the boat.

18 In March 1996, Frank sold the Tiger – the boat that he had operated during the 1980s – and deposited $40,000 from the proceeds of sale into the company account. In May 1996, Frank inherited about $37,000 from his father, and deposited it into the company account.

19 In November 1996, the Commonwealth licences – which, as I have mentioned, had been transferred into the names of Joe and Jim in February 1996 – were apparently transferred into the name of Joe alone, and the State licence was similarly transferred from Joe and Jim into the name of Joe alone on 3 December 1996. There is no admissible evidence as to why any of the transfers of ownership of the licences took place.

20 On 24 February 1997, Frank applied for a permit to operate as an additional skipper of the Kimbarra, and Joe consented to an additional skipper endorsement entitling Frank to "operate my vessel" during 1997.

21 In about 1998, the company, and Joe as the licensee, became parties to litigation against Telstra, and subsequently Optus, in which they and other fishermen sought compensation for economic loss occasioned by cables laid by Telstra and Optus. Their contributions to the fighting fund for that litigation were funded from the company's overdraft account.

22 On 31 August 1998, Joe sent a letter to New South Wales Fisheries, in which he spoke of his having purchased the licence and referred to the licence as his own. As he was the licence holder, I would not regard this as particularly significant when it comes to considering where the beneficial ownership lay.

The sons fall out with their father

23 In about April 2002, there was a falling out between Joe and Jim on the one hand and Frank on the other. Joe and Jim wished to operate the Kimbarra on their own, did not agree with Frank's advice, and no longer sought his advice or assistance; Frank said that he no longer wished to be associated with the boat, and had nothing to do with his sons for a period of about two years. At this time negotiations for the settlement of the litigation against Telstra and Optus were progressing. However, before any such negotiations had been finalised, Joe and Jim instructed solicitors, who prepared a proposed agreement with Frank, which Joe and Jim signed and submitted to Frank. That draft agreement provided, in essence, for Joe and Jim to purchase the shares of Frank and Maria in the company for $1 each, to pay them $300 per week for their joint lives and thereafter the life of the survivor of them, and to indemnify them in respect of any liability to Westpac on the overdraft. Frank did not accept that offer.

24 The litigation against Optus and Telstra was settled shortly afterwards, in May 2002. As a result of that litigation, Jim and Joe received $115,000, which one or both of them arranged to be made payable to themselves jointly, rather than to the company. Dimento Pty Limited apparently ceased trading as such in June 2002, and Joe and Jim thereafter operated the Kimbarra together, until their subsequent falling out in late 1993, to which I shall come.

25 In November 2002, Joe and Jim together purchased real property at 5 Morrissey Way, Greenwell Point for a price of $261,000. They borrowed $220,000 from Westpac and used $45,000 from the proceeds of the Telstra/Optus settlement. The balance of the proceeds of the Telstra/Optus settlement was used, in one way or another, to repay the company overdraft, and on 8 January 2003, the overdraft having been repaid, the mortgage over Frank and Maria's home was discharged.

The sons fall out with each other

26 Towards the end of 2003 Jim and Joe fell out. Jim ceased working on the Kimbarra and became reconciled with his father, doing some work with him on a small boat, which his father was then operating on the Harbour. In about November 2003 they instructed Mullick & Associates, Solicitors, who, on about 26 November 2003, sent to Joe a letter which relevantly provided as follows (emphasis added):

We act for Jim Dimento and Frank Dimento.

We are instructed that you and our clients entered into a Partnership Agreement in 1990 with respect to the conduct of the fishing business .

We are further instructed that you have failed to account to our clients for their share of income of the business.

We give you notice that unless you so account within 14 days of the date hereof, we are instructed to make application to the Court for the appointment of a Receiver.

27 On 9 December 2003, Boyd House & Partners, Solicitors, responded on behalf of Joe, relevantly as follows (emphasis added):

Your letter asserts that there was a Partnership Agreement between certain persons apparently in existence from 1990 with respect to the conduct of a fishing business. We are instructed that this is contrary to the facts in that whilst our client and Jim Dimento worked with Frank Dimento from 1990 until early 2002 we are instructed that this was more in the nature of employment than a partnership, as on our instructions our client and Jim Dimento were only paid wages during the whole of this period and did not share in the profits of the business .

We are further instructed that in early 2002 due to the wish of Frank Dimento to retire from operating the business there were certain negotiations between our respective clients which resulted in no formal documents being executed although apparently Vosnikas and Associates Solicitors were instructed to prepare a Partnership Agreement. Despite those agreements never being executed apparently from early 2002 Joe and Jim Dimento operated the fishing business and your client Frank Dimento was paid certain monies which allowed release of a mortgage that had been held by Westpac Bank over Frank and Maria Dimento's property at Perry Street, Leichhardt. On our client's instructions, the sum paid to Frank Dimento was purchase monies for the business by Joe and Jim from Frank and Maria Dimento .

We are instructed that since that time Joe and Jim Dimento had operated the fishing business and from time to time apparently had paid Frank further monies representing further purchase monies for the business . Sometime in early October 2003 your client Jim Dimento indicated to our client that he no longer wished to work upon the boat and since 3 October 2003 has not returned to work on the boat at any stage and has not provided any explanation to our client as to his intentions or what he wishes to happen to his interest in the business. Since that time our client has had to operate the business including attending to pay all liabilities and we are instructed that there are significant liabilities. Our client has had to engage a casual employee to cover the role that Jim formerly carried out on the boat.

28 Meanwhile, on 21 December 2003, the company Dimento Pty Limited was deregistered.

29 Correspondence continued between Boyd House & Partners and Mullick & Associates. By letter dated 28 January 2004, Boyd House, on behalf of Joe, mentioned an anticipated agreement for sale of the Kimbarra for $300,000 and proposed that the net proceeds be divided one-third to Joe, one-third to Jim and the remaining one-third to Frank.

30 Mullick & Associates responded on 2 March 2004, proposing that the Greenwell Point property be transferred to Jim and that he refinance it; that from the proceeds of sale of the Kimbarra $60,000 be paid to Jim, $100,000 to Frank and that Joe repay to Jim a personal loan of $10,000 and retain the balance, estimated to be $140,000.

31 On 19 March 2004, Boyd House responded that Joe would not agree to transfer the Greenwell Point property to Jim except on payment of his 50 percent share of the equity, and that the purchasers of the Kimbarra were insisting that the licences be upgraded and were not otherwise prepared to buy the boat, in which event some other division of the boat and licences would have to be negotiated.

32 On 29 March 2004, Boyd House wrote again, indicating that the prospective purchaser of the Kimbarra had reduced his offer of $250,000, and intended to walk away if the matter did not proceed in the next couple of days. Boyd House pressed the matter on 2 April 2004, asserting that it was now extremely urgent, as the sale would fall through if it were not agreed very promptly.

The June 2004 Agreement

33 By this time Joe had acquired and was operating another vessel, the Tasman Explorer. In May 2004, Jim approached Joe and there were oral negotiations between them with a view to resolving the impasse. Some time during May 2004, at a meeting on the Tasman Explorer, they apparently reached consensus that Jim would transfer his interest in the Greenwell Point property to Joe and assume responsibility for the mortgage, and that Joe would transfer to Jim his interest in the Kimbarra and the attached licences. However, aspects of the background to this assume importance.

34 According to Joe, Jim said to him: "Dad and I have made up and we are working on Dad's small boat, but the bay is only functional for six months of the year and at the moment it is closed. If you give me the licence and the Kimbarra, we will be able to fish outside the Harbour in the ocean. If you transfer the licence and boat to me, I will transfer my share in the Greenwell Point property to you. Dad and I will run the Kimbarra”.

35 Although Jim initially denied that conversation and said that he recalled Joe saying to him, "I will put the licences and boat in your name so long as the old man does not get one cent out of it", in his oral evidence he conceded substantial parts of Joe’s version – but not those parts which implied any ongoing involvement of Frank. Indeed, Jim maintained that there was no contemplation of Frank having any such role. Jim says that Joe proposed to him, "You take the boat and all the licences, fix up the boat because you can make a living out of it, and I will take the house over. I will be able to use the house to finance my share in the Tasman". Jim says that he replied that he would think about it, but more than likely agree, and after two or three days, in response to a telephone call from Joe, said, "I will take the boat and you can have the house but we have to get something drawn up ... ".

36 According to Frank, he suggested to Jim, some months earlier: "You should approach Joe to let us work the Kimbarra. We will do the same thing we have always done. I will be the brains and I will advise you what to do. If Frank leaves us the boat, you should leave him your share in the house. Go to Joe and tell him we want to take over the boat. You'll give him your half of the house if he gives us his half of Kimbarra. We will work the boat the same way we always have", and Jim responded, "I will go and talk to Joe”. A few months later, Jim reported to Frank that Joe had told him, "So long as you work with the old man and you take his advice, I will accept the deal to transfer my share of the boat to you and for you to transfer your share of the house to me. The licence will be transferred to you on the basis that Dad remains the rightful owner of the licence".

37 On 10 June 2004, Jim and Joe executed an agreement, which had been prepared by Joe's lawyers, Boyd House. That agreement relevantly provided as follows:

RECITALS:

A. Whereas Joe and Jim have to date been in partnership in operation of the fishing boat 'Kimbarra' and in partnership in the ownership of 5 Morrissey Way, Greenwell Point.

B. Whereas Joe and Jim are joint owners of the commercial fishing vessel LFB 11099 ('Kimbarra').

C. Whereas Joe is the owner of all licences associated with the fishing vessel 'Kimbarra' registered as fishing business number 383 ('Licences').

D. Whereas Joe and Jim wish to now enter into formal agreements to dissolve their partnership and provide for the arrangements to operate after dissolution of that partnership and execution of this Agreement between Joe and Jim.

THE PARTIES AGREE THAT:

1. Within 4 weeks of the date hereof the parties will do all acts and things and sign all instruments necessary to transfer the Licences and register with the Department of Fisheries such Licenses into Jim's name. Jim will be liable for any stamp duty or costs involved in transfer of those licenses.

2. Simultaneous with the transfer referred to in clause 1 hereof Jim will do all acts and things and sign all instruments necessary to transfer to Joe the property at 5 Morrissey Way, Greenwell Point wholly contained in Folio Identifier 50/245804 ('the property').

3. Simultaneous with the receipt of the transfer referred to in clause 2 hereof Joe will discharge or refinance the mortgage to Westpac in respect of the property which mortgage currently amounts to $212,000.00 and Jim will sign all documents necessary to effect such discharge. Pending such discharge all income received from the property is to be paid in reduction of the said mortgage to Westpac or to Joe as he may direct.

4. Joe will retain from the fishing boat 'Kimbarra' the long line machine ('machine') and will be responsible for all debts attached to or in respect of the machine and Joe will indemnify and keep indemnified Jim from any claims, suits or proceedings relating to such debts.

5. Should at any time in the future Department of Fisheries or the New South Wales Government offer Jim the opportunity to buy back the licenses and shares attached to the licenses attached to the vessel 'Kimbarra' for any sum more than $300,000.00 then Jim will pay 20% of any proceeds above $300,000.00 to Joe and Jim shall be entitled to the remaining 80% of the proceeds about $300,000.00. For the purpose of this agreement Jim agrees to keep Joe informed of any such offers and shall provide copies of all correspondence from the Department of Fisheries or the New South Wales Government or any other Government Authority in respect of such buy back of the licenses as soon as they are received by Jim.

...

11. It is acknowledged and agreed that Joe has already signed a Statutory Declaration confirming that Joe and Jim have been the owners of the Commercial Fishing Vessel LFB 11099 named 'Kimbarra' since 1989 and a Statutory Declaration by Joe confirming Jim's level of services provided on that vessel between January 1990 and October 2003 to enable Jim to obtain his Master Class 5 ticket to enable him to operate the vessel Kimbarra. Jim also agrees as and from the date of this agreement that he will be responsible for maintenance of the vessel Kimbarra to ensure its safe custody at the fishing market docks and be responsible for all maintenance and upkeep of the vessel from the date of this agreement.

12. This agreement is conditional upon the final approval of the Department of Fisheries/New South Wales Government to the transfer of the licenses referred to in clause 1 hereof and Jim shall make his own enquiries in relation to such transfer and make every endeavour to obtain the necessary approval without undue delay.

38 On 8 June 2004, Joe executed a request that the New South Wales Department of Fisheries prepare a Restricted Interim Transfer Agreement for the transfer of the fishing business to Jim, which was apparently prepared and sent to Joe on 7 July 2004, but was not completed nor lodged. On 10 June 2004, a document entitled Change of Ownership, in respect of the Kimbarra, was dated and signed by Jim and apparently by Joe. That document, recording the change in the ownership of the vessel Kimbarra from Joe to Jim, was lodged with Waterways not later than 21 June 2004. Although Joe disputes that the signature on the document is his, I think, on balance, that he did sign it. Joe's signature, as it appears on this form, is sufficiently similar to other specimens of his signature in evidence that I would infer, in the absence of better evidence, that it is his signature. Moreover, it is unlikely, in the context of the relationship that then prevailed between Joe and Jim, that it was forged between 10 June and 21 June, by which time it had been registered – Joe executed other documents consistent with an agreement for transfer of the boat and licences to Jim at and about that time. On 28 June 2004, Joe signed a form nominating Jim as the nominated fisher authorised to take fish on behalf of Joe as licence holder, the effect of which was that Jim was able to operate the Kimbarra and enjoy the fishing entitlements conferred by the Commonwealth and State licences.

The purported termination

39 Although the agreement of 10 June contained a time stipulation of four weeks, there was nothing in the agreement that made that requirement essential and the parties did not adhere to that time requirement. However, they did correspond about the implementation of the agreement with Boyd House writing on 28 July and 24 August in pursuance of implementation of the agreement. On 28 July, they forwarded to Mullick & Associates a document of transfer for the fishing boat licence, requesting that Jim complete his part of the document and indicating that they would then arrange for execution of the transfer and settlement. On 24 August, they enclosed a request to release the mortgage over the Greenwell Point property for signature by Jim and return. A copy of that request, apparently signed by Joe but not by Jim, is in evidence. Jim claims that he signed a copy and that his solicitors returned it to Joe, but a call for it or any copy of the version signed by Jim or the covering letter returning it to Joe's solicitors went unanswered. Joe claims that the version apparently signed by him does not, in truth, bear his signature, but in circumstances that his solicitors submitted a form on 24 August, although the covering letter did not expressly assert that the enclosure had already been signed by their client, I am again disinclined to accept that the signature is other than authentic.

40 On 30 August 2004, Mullick & Associates submitted to Boyd House an amended deed – incorporating a reference to the Commonwealth licence, which had been omitted from the original agreement – and the fishing licence transfer document signed by Jim. They requested that urgent attention be given to lodging the document with the Fisheries Department. However, Joe was out of Sydney, and, on 14 September, Boyd House responded that Joe was prepared to sign the amended agreement, and observing that while the documents needed to be lodged by 7 September 2004 to meet the requirements of the New South Wales Department of Primary Industries, there would be practical difficulties in achieving that and an extension might be required.

41 On 22 November 2004, Boyd House wrote to Mullicks enclosing a copy application for transfer of the Commonwealth licence, observing that the original would be handed over in exchange for the stamped transfer signed by Jim of the Greenwell Point property, and recording that Joe had already signed the transfer documents for the New South Wales licences and would hand them over also in exchange for the real property transfer. The letter continued:

It has become urgent for us to arrange settlement of the transfer of the Greenwell Point property, as our client now has funding to effect that transfer and does not wish to have to pay further interest to Westpac Bank.

On receipt of this correspondence, could you urgently telephone the writer to make the necessary arrangements so that this long-running matter can now be finalised.

42 On 26 November, having received no reply to the facsimile of 22 November, Boyd House wrote again:

We are now instructed that, in light of your client's failure to comply with the terms of the previous agreement between the parties, our clients no longer feel themselves bound by the terms of that agreement and consider the agreement to have come to an end.

We note that the ownership of the boat Kimbarra remains in the name of Joe Dimento. We are instructed that any use of the boat by your client for fishing or any other purposes is not authorised and should your client use the boat, it will be at your client's risk totally.

43 That letter seems to overlook that, regardless of whether the transfer of ownership of Kimbarra had or had not been signed by Joe, he had at least signed the authority nominating Jim as the nominated fisher which authorised Jim to fish.

After the termination

44 On 29 November, Mullick & Associates responded, disputing that Joe was entitled to terminate, and setting out reasons why he was not. They said, "We will deliver the stamped transfer to your office tomorrow for you to sign and hold in escrow for use on settlement only”. The letter enclosed a copy of transfer signed by Jim, saying, "We enclose copy of the Transfer of the property signed by our client, the stamped original which was to be handed to you on settlement". It seems clear from that letter that, on 29 November 2004, Mullick & Associates were in possession of the stamped original transfer. On the same day, Mullick & Associates sent a further letter recording that they had received instructions that ownership of the boat was transferred by mutual arrangement independent of the solicitors at the time of signing the agreement.

45 Jim asserts that on about 30 November 2004 he hand delivered to Joe the signed transfer for the Commonwealth licence and an original memorandum of transfer of the Greenwell Point property, and had a conversation with him. Joe had left Australia and entered Samoa on 26 November. It seems impossible, given the correspondence of 26 and 29 November, that Jim could have delivered an original transfer of the property to Joe as Jim asserts in his affidavit. In his affidavit he refers to a conversation with Joe taking place the day before Joe left for overseas. If so, that must have been 25 November, and it is conceivable that Jim may have handed over a copy of the transfer, although the correspondence from Mullick & Associates makes even that unlikely. But I do not think it is conceivable that he handed over an original stamped transfer, nor that Mullick & Associates would have released the original transfer to Jim to be handed over.

46 Jim says that he then attended the offices of the Department of Primary Industries to progress the transfer. If that is so, it must have occurred on or about 25 November, before the purported termination on 26 November.

47 On 18 January 2005, the Department of Primary Industries received verbal advice that the transfer was to proceed and commenced preparation of a new interim transfer agreement, the earlier one having lapsed on 7 September 2004. The Department was instructed to forward it to Jim's, instead of Joe's, address. Jim says that Joe was consulted on the telephone in the course of this, but the evidence from the Department does not confirm that to be so, although it does not exclude the possibility.

48 Joe says that in or about early December 2004 while he was overseas he had a telephone conversation with Jim in which Joe said:

What we'll do is we'll sell Greenwell Point and split the money, with our half of the money you can pay Clare's parents back. As for the boat we will get it valued and you can pay me half when you can. You can pay it off down the track. That won't be a problem. As for the licence, I will let you have it for a fixed rate or a weekly income, but you will have to pay the renewal fees on it seeing that you are working the licences and keeping the money that you are making. You can pay the fees for the licence every year.

49 Jim is said to have replied:

Yeah, I will think about it. As long as I can keep working now.

50 When the time for licence renewal fees approached, Jim refused to pay them, he says because the licences had not been transferred to him. He claims that he indicated that he would pay them if the licences were transferred to him, but that Joe said that he would not transfer them. On 31 May 2005, Joe informed the Australian Fisheries Management Authority that while Jim was authorised to pay the licence fees, in the event of any default Joe would be responsible for them rather than suffer surrender of the licence for non-payment.

51 Following Jim's continued refusal to pay the licence fee, and professed concerns about Jim's use of the Kimbarra and its safety, Joe revoked Jim's nomination as authorised fisher on 24 June 2005, of which Jim was informed on 6 July 2005. On 8 July 2005, Mullick & Associates wrote to Joe referring to the agreement and demanding that Joe perform those parts of it which remained unperformed, including by transferring the fishing business and licences to Jim. On 14 July, Joe, however, transferred the State licences to Frank. On 16 August 2005, Jim commenced these proceedings against Joe only. On 18 August, Joe applied to transfer the Commonwealth licences to Frank, and that application was processed and granted on 15 December 2005. These actions of Joe came to Jim's knowledge in December 2006, and on 1 December 2006, he sought leave to join Frank as second defendant, which leave was granted on 14 December 2006. Subsequently, on 3 May 2007, Joe filed a cross-claim seeking a declaration that he, or alternatively Dimento Pty Limited, is beneficially entitled to the Kimbarra.

52 In June 2007, under consensual interim arrangements, the Greenwell Point property was sold; the net proceeds of its sale after discharge of the mortgage, amounting to about $70,000, are held in a trust account pending the outcome of these proceedings.

The issues

53 Jim seeks specific performance of the agreement of 10 July 2004 against Joe. Against Frank, he seeks orders having the effect of treating as invalid for fraud, or pursuant to Conveyancing Act, s 37A, the transfer of the licences from Joe to Frank. The main issues on Jim’s claim are:

· first, whether a binding and enforceable agreement was made on 10 July 2004 and what were its relevant terms;

· secondly, whether any such agreement has been terminated or abandoned;

· thirdly, whether specific performance should be decreed or, if declined, whether any and if so what damages should be awarded. Inherent in the question whether specific performance should be declined, is what are the beneficial entitlements to the licences.

54 On Joe’s cross-claim, the main issue is the beneficial ownership of the vessel Kimbarra.

The agreement issue

55 Although, at one stage, it was contended on behalf of Jim that a binding oral agreement was made in May 2004 in the first or fourth classes of Masters v Cameron, ultimately that argument was not pressed, reliance being placed only on the written agreement of 10 June 2004. Joe does not dispute that an agreement was made between him and Jim in the terms of that document.

56 The document has never been stamped. When the Court raised that issue, Jim's counsel indicated that he would seek instructions to give an undertaking to stamp it. If I come to the view that relief should be granted to Jim, it will be conditional upon the tender to the Court of a duly stamped document.

57 Jim asserts, as I have recorded, that the vessel was transferred pursuant to the transfer, also dated 10 June 2004. The terms of the contract of 10 June 2004 do not include any express promise to transfer the vessel Kimbarra, although both Jim and Joe accept that their discussions contemplated and envisaged the transfer of the Kimbarra – indeed, the fact that they mutually contemplated its transfer is one of the reasons why I think it unlikely that Joe’s signature on the transfer document is a forgery. Clause 11 of the contract does not favour the view that there was to be a transfer, but rather provides for Jim to have use of and responsibility for of the vessel. No application for rectification of the written contract has been made.

58 I cannot imply or construe a promise to transfer the Kimbarra into the document. The transfer of the Kimbarra depends independently on the transfer document of 10 June itself. For his part, Jim is content to rely on the fact of the transfer and that the vessel is registered in his name, and seeks no relief in respect of the vessel.

59 As to the licences, there was some debate as to whether, on the proper construction of the agreement, it was to transfer Joe's legal interest only, subject to the equities, or whether it contained a promise to transfer the licences beneficially. Although there is some support for the former view in the terms of clause 1 – which provides for the transfer of the licences "into Jim's name" – in the context of the agreement as a whole – in particular, the recital that Joe is the owner of the licences, the provision to the effect that in the event of a buy-back scheme, Jim would retain the first $300,000 and divide the surplus 20 percent to Joe and 80 percent to himself, and the countervailing provision for the transfer of Jim’s interest in Greenwell Point to Joe, which was unquestionably intended to deal with the beneficial interest, the overwhelming indications are that the contract was one to convey the licences beneficially.

60 Accordingly, I conclude that the contract bound Joe to convey to Jim within four weeks the beneficial interest in the State licences to which it referred and which, by the subsequent amendment, came to include the Commonwealth licences.

The termination and abandonment issue

61 As I have recorded, that did not happen within four weeks of 10 June 2004. However, the time provision was not an essential one, and the parties did not treat it as essential. The first recorded complaint about delay was the letter of 22 November 2006 from Mullick & Associates to Boyd House. In my view, it was insufficient to make time essential. It did not specify a particular time frame for completion nor a date, time and place for completion. In any event, it was quite insufficient to authorise termination for failure to comply with the time condition only four days later on 26 November. The purported termination on 26 November was ineffective.

62 Although that purported termination would have been repudiatory, that is beside the point since, by Mullick & Associates’ letter of 29 November, Jim elected to affirm the contract, which election was effectively repeated by the institution of proceedings for specific performance. It follows that the contract was not terminated in November 2004, but remained on foot.

63 It is next contended on behalf the Joe that the contract was abandoned. In Fitzgerald v Masters (1956) 95 CLR 420, Dixon and Fullagar JJ said (at 432):

There can be no doubt that, where what has been called an 'inordinate' length of time has been allowed to elapse, during which neither party has attempted to perform, or called upon the other to perform, a contract made between them, it may be inferred that the contract has been abandoned. ... What is really inferred in such a case is that the contract has been discharged by agreement, each party being entitled to assume from a long-continued ignoring of the contract on both sides that ... the matter is off altogether.

64 I have already referred to the evidence of Jim as to what he says happened in late November/early December, and that of Joe as to the conversation he says he had with Jim in early December 2004. As I have mentioned, Joe left Australia for Samoa on 26 November. The events to which Jim deposes are unlikely to have taken place before 26 November, which was the date of purported termination, and could not have taken place after then when Joe was in Samoa. However, the high point of the case on abandonment is the conversation that Joe says he had with Jim in early December 2004. Joe’s version attributes to Jim the response: "Yeah, I'll think about it as long as I can keep working now". Jim says that, while he accepts Joe’s version of what Joe said, he did not accept Joe’s proposal, and I do not think Joe's version attributes to Jim unequivocal acceptance. The passage of some months thereafter, in the course of which Jim declined to pay licence fees – when he was under no legal obligation to pay them, in the absence of the licences having been transferred to him – does not evidence acceptance of a proposed discharge of the contract.

65 The case is quite distinct from cases such as DTR Nominees Pty Limited v Mona Homes Pty Limited (1978) 138 CLR 423 in which both parties purported to have terminated or rescinded for default by the other. As it turned out, neither was entitled to rescind, but the High Court held that the contract had been abandoned, because both treated it as no longer being on foot. The evidence in this case does not indicate that Jim was treating the contract as no longer on foot.

66 Accordingly, in my view, when Jim instituted these proceedings, the contract of 10 June 2004 had not been terminated nor abandoned, but remained on foot.

Specific performance

67 Two main arguments were advanced as to why specific performance should not be granted.

68 The first is the discretionary consideration of delay. Any delay is to be measured at worst as nine months, from the repudiation in December 2004 until proceedings were commenced in about September 2005. A more realistic measure is from the cancellation of Jim’s nominated fisher rights, in mid 2005.

69 There does not appear to have been any relevant intervention of any third party rights as a result of any delay. Nor was any prejudice apparently occasioned to Joe by that delay, and there is no evidence of any detrimental reliance by him on any assumption that proceedings would not be brought. In my view, the delay is not such as to disqualify Jim from claiming specific performance.

70 The other basis upon which it is submitted that specific performance should be declined is that to order specific performance would be to require Joe to perform acts inconsistent with equitable obligations owed by him and Jim to a third party, either Frank or the company Dimento Pty Limited. At the heart of this defence in this case lies the contention that either Frank or the company Dimento Pty Limited is beneficially entitled to the licences.

71 While this turns, in part, on the conversations that took place in early 1992, the resolution of the conflict about those conversations and the true intent of the parties is much better illuminated by what they had done over the ensuing decade, rather than their professed recollection of conversations, now 15 years old, which no one would reasonably expect to be accurate.

72 Significant features of what happened during that decade are these. First, the names in which the fishing licences were held were changed from time to time between Joe and Jim jointly and Joe alone, without consideration. Indeed, although the evidence of Frank suggested that the licences were originally to be acquired and held in the name of Joe alone, it seems, although the evidence is less than conclusive, that the State licence was originally acquired in the names of both Joe and Jim, which itself casts doubt on the proposition that there was an understanding that they would be held by Joe alone. The significance of these changes of the names in which the licences were held, without consideration, is that it suggests that no one thought that changing the name in which they were held affected the beneficial ownership, which did not reside with the nominal ownership. Secondly, substantial financial contributions were made to the business by Frank – not only the overdraft, to which he was a joint party with Joe and for which he and his wife provided the security at the outset, but also his contributions of the proceeds of sale of the Tiger of some $40,000, and the inheritance of $37,000. The fact that he continued to make financial contributions to the business of that order tells against him having or retaining no beneficial interest in it. Thirdly, and significantly, Frank was permitted to draw funds from the business more or less as he pleased and indeed had substantial financial control of the business. This also tells against it being the understanding of the parties that he should have no beneficial interest. Fourthly, there is the continuing involvement of Frank in other ways in affairs of the fishing business, both as an adviser and occasional attendances on board the vessel, and in giving instructions in connection with the Telstra and Optus litigation. Fifthly, there are the events that took place after the falling out with Frank in early 2002 and, in particular, the offer made to Frank and Maria in April 2002, already mentioned. The fact that Joe and Jim were prepared to offer $300 per week for life and an indemnity in respect of the overdraft is consistent with and corroborative of those versions of the 1992 discussions that include reference to the business providing support Frank and Maria for the rest of their lives, and favours the view that they were to retain a beneficial interest. Sixthly, there is the correspondence of December 2003 and early 2004. The assertion on behalf of Jim and Frank, who were then allied, that Jim, Frank, Joe (and possibly Maria) had been in partnership since about 1990; the response on behalf of Joe, proposing that although the relationship was more in the nature of employment with Frank as the employer and Jim and Joe only being paid wages and not sharing in the profits, the proceeds of the vessel be divided in equal one-third shares between Frank, Jim and Joe; and the reply on behalf of Jim and Frank that the proceeds of the vessel be divided between the three men, although in different proportions, all favour the view that it was universally accepted that Frank retained a beneficial interest. Seventhly, there is, as I have already mentioned, the circumstance that the parties structured their affairs, first through a partnership and then through a company, the accounts of which treated the boat and licences as assets first of the partnership and then of the company.

73 Taken together, these matters provide strong indications that there was no understanding in 1992 or subsequently that Jim and Joe would be beneficially entitled – to the exclusion of Frank and perhaps Maria – to the benefit of the fishing business, including the boat and the licences. The better view is that there was an ill-defined and imprecise understanding that the business would be carried on for the benefit of the whole family. While Joe and Jim were to have some interest and some rights to draw on the business, it is clear that Frank (and perhaps Maria) were intended to retain a beneficial interest, at least for their lifetime. If the presumption of advancement were otherwise relevant, the matters to which I have referred rebut it.

74 In my view, Jim’s version of the 1992 conversations is significantly influenced by ex post facto reconstruction, as illustrated by the following excerpt from his cross-examination:

Any expenses from the house or a wage at the end of the week that he [Frank] wanted to take, whatever he wanted to take, he was the boss, he could do whatever he wanted, but paying off the boat and licence was coming out of Jim Dimento’s pocket. So the ownership eventually when it was paid off, had to fall into the hands of Joe and Jim Dimento.

75 The parties did not, in their discussions in 1992, give close attention to the fine details of their legal and equitable relationships, but as things progressed they clothed their relationship with legal structures – first partnership and subsequently incorporation. The ultimate form that their relationship adopted was that of the company Dimento Pty Limited. The financial statements of Dimento Pty Limited, like those of the partnership, were signed by Joe and Jim, and treated the boat and licences as assets of the company. Jim says that he was unaware that Frank and Maria were also shareholders and directors of the company, but whether or not he was aware of it, it was part the structure to which he must be taken to have been content to assent. Accordingly, by 2002, the relationship of the parties was that of shareholders in the company Dimento Pty Limited, which in equity owned the boat and in equity owned the licences.

76 Did anything change after 2002? For a time I was inclined to the view that, as a result of the repayment of the overdraft in early 2003 and the release of the mortgage over Frank and Maria's property, there was implicitly, if not expressly, a division of the ways of the parties and an acceptance between them that each would go their own ways. However, the evidence that subsequently emerged – in particular, the offer of April 2002 – counters any inference that the unilateral act of Jim and Joe in paying off the overdraft, and the separate unilateral act of Frank in procuring release of the mortgage, were intended to effect a release of any equitable interest held by Frank. The offer of April 2002 makes clear that the parties understood what was required to remove Frank and Maria's interest – namely, a purchase of their shares. In circumstances where an offer had been made to indemnify them in respect of the overdraft and to pay them $300 a week for life, I do not see how it could be inferred that that result was achieved by the repayment of the overdraft and the release of the mortgage in early 2003.

77 It is true that, in the course of his cross-examination, Frank accepted that he knew that Joe and Jim “owned” the boat, and that Joe “owned” the licences, and that the licence was not in his (Frank’s) name. There is little utility in concessions of “ownership” of the boat or the licence, or that the boat or the licence “belonged” to Joe and Jim rather than to Frank, if the relevant concepts of ownership and belonging are not defined, as they were not here. Those concessions are equally consistent with a concession of legal title as distinct from beneficial interest. This is apparent on occasions from Frank's responses, for example:

Q. And you knew, I am suggesting to you, that Joe and Jim owned the boat.
A. Yes.

Q. And that Joe owned the licences?
A. Yes.

Q. They weren't your licences?
A. No, the licence was not in my name.

78 The reference to the licence being "not in my name" is entirely consistent with Frank contemplating legal title as distinct from a beneficial interest.

79 It is also correct that Frank conceded at one point that Joe could transfer the boat if he wanted to. Again, however, it is significant that in the course of that cross-examination, Frank's answers included "that was my own will" – namely, that it was his own idea that there should be such a transfer, he having originally suggested it to Jim in early 2004. These answers were also qualified, at times, by Frank saying "if I want it", in connection with Joe's ability to transfer the licences. The factual context of this part of the cross-examination was the negotiations in 2004, both before and after the agreement of 10 June that year. At that time the relationship between the parties had broken down, and it seemed impracticable that the fishing business could continue as it had in the past. Those who had the ultimate beneficial interests were negotiating as to how the assets might be divided between them.

80 Had they all agreed, then it might be that the transaction could have been consummated. But even disregarding the corporate veil of Dimento Pty Limited and assuming that Frank had Maria's authority to negotiate on her behalf – of which there is no evidence – on no view did Frank authorise a dealing with the assets of the business which left him with no residual interest or entitlement. Frank's version is that what he suggested and authorised was the transfer of the licences to Jim on the basis that Jim would operate the Kimbarra in conjunction with Frank, and that Frank would thus retain an interest in the licences. Indeed, Frank's version is that Jim reported back to him that the arrangement was expressly on the basis that Frank would remain the real owner of the licences. Joe's version, although less explicit, is substantially consistent, attributing to Jim statements to the effect "We will be able to fish outside the Harbour" – the "we" being Jim and Frank – and "Dad and I will run the Kimbarra". Accordingly, both on Frank's version, and on Joe's version, what Frank might be taken to have consented to, at the highest, was a transfer of the licences to Jim on the basis that Frank would retain some beneficial interest in them. As for Jim’s version, he does not suggest that Frank gave any approval or authority at all for such a transfer, but denies the conversations that attribute any involvement to Frank completely. Thus, on the view most adverse to Frank, I cannot see that he can be taken as having released, even if he could have done so on behalf of Dimento Pty Limited, his underlying beneficial interest (strictly, as a shareholder in the company) in the licences. What he authorised or approved was at the highest a transfer of the licences that did not detract from his (or the company’s) beneficial interest.

81 The transaction which Joe and Jim entered into was not one to that effect, because it contemplated a vesting of the entire beneficial interest in Jim.

82 Accordingly, specific enforcement of the contract would require the transfer to Jim of the beneficial interest in a licence or licences that Joe is not entitled to transfer because those interests do not reside in him. Prima facie, those interests reside with Dimento Pty Limited, and it would be contrary to the equitable obligations of Joe in whose name the legal title was held to transfer or to agree to transfer them to Jim. It follows that specific performance should be declined, on grounds of impossibility, as Joe cannot convey to Jim the beneficial interest in the licences, which are not his to convey [cf Seawall v Webster (1859) 29 LJCh 71] – and because to do so would be to require him to act inconsistent with the equitable obligations and rights associated with ownership of the licences, of whjich Jim also must be taken to have been on notice [cf Colyton Investments Pty Ltd v McSorley (1962) 107 CLR 177, 185].

83 In any event, given that it is at least possible that Dimento Pty Limited is entitled in equity to the licences, it would be entirely inappropriate to make an order for specific performance without affording Dimento Pty Limited an opportunity to be heard. For reasons that remain elusive, no party has taken any step to have Dimento Pty Limited restored to the register and joined to the proceedings so that those issues can be resolved in this case. Unfortunately, this will probably doom the family to further litigation while the consequences of Dimento’s deregistration are addressed.

Damages for breach of contract

84 However, specific performance having been declined, does not leave Jim without a remedy. As I have already explained, the repudiation inherent in Joe’s purported termination was not accepted by Jim, who elected to affirm the contract. Moreover, the Greenwell Point property has been sold and the net proceeds are held pending the outcome of these proceedings. As I have held that there is a binding and enforceable contract under which the house was to be transferred to Joe, it would follow that Joe would be entitled to the proceeds of the house.

85 On the other hand, under the contract, Jim was entitled to receive the licences beneficially, for whatever they were worth. Ascertaining the value of the licences is not an easy exercise, and there is precious little evidence on the topic. However, there is not a total dearth of evidence: the latest financial statements of Dimento Pty Limited are those for the year ended 2003, and they attribute to intangibles a depreciated value of $38,315, which is explained as goodwill at cost of $49,000, less accumulated amortisation of $11,000. The goodwill must be the benefit of the licences assigned to the company by the partnership in 1995. Although this evidence is less than satisfactory, the Court has to do the best it can with such evidence as is available, and on the available evidence, I find the value of the licences to be, as per the balance sheet, $38,315.

86 The first defendant should therefore pay the plaintiff damages of $38,315.

87 I am not unmindful that in an indirect way this achieves some sort of practical justice, in the sense that while it is not precisely half of the $70,000 (approximately) net proceeds of sale of Greenwell Point, it ultimately results in a roughly equal distribution between Joe and Jim of those proceeds. If, on the other hand, I had acceded to the argument that the contract had been abandoned, the result would have been that the $70,000 would have been shared equally between the two co-owners.

88 Accordingly, while I will give the parties an opportunity to bring in short minutes to give more precise effect to the outcome, it seems to me that that upon the undertaking of the plaintiff to the Court to present for stamping and to pay all duty and penalties assessed in respect of the contract dated 10 June 2004 between the plaintiff and the first defendant, and upon the plaintiff tendering to the Court the contract so stamped, there should be judgment that the first defendant pay the plaintiff $38,315, and the plaintiff's claim should be otherwise dismissed.

The cross-claim

89 So far as the cross-claim is concerned, it follows from the conclusions that I have already expressed, that, prima facie, the boat is beneficially the property of the company. However, all that is sought is declaratory relief. The boat is not in the possession of the company, but in the possession of Jim. To grant a declaration would not finally resolve the dispute between the parties, but simply be a step along the way to further litigation, namely, a suit for delivery up of the boat. In any event, such a declaration would not bind the company, which is not a party to these proceedings.

90 For reasons explained authoritatively by the High Court in Neeta (Epping) Pty Ltd v Phillips (1974) 131 CLR 286, it is inappropriate to grant bare declaratory relief, where to do so will not resolve the true dispute between the parties [see Commonwealth of Australia v BIS Cleanaway Limited [2007] NSWSC 1075]. It is even less appropriate to do so in this case when the company, apparently entitled to the benefit of any such declaration, is not a party to the proceedings. Accordingly, the cross-claim should be dismissed.

Orders

91 For the foregoing reasons, and subject to any submissions as to their form, I propose to make the following orders:

1. Upon the plaintiff by his counsel undertaking to the Court to present for stamping the contract between the plaintiff and the first defendant dated 10 June 2004 and to pay all duty and penalties assessed thereon, and upon the tender to the Court of the contract duly stamped:


1.1 Declare that the first defendant is entitled to the balance proceeds of sale of the property comprised in Folio Identifier 50/245804, situate at and known as 5 Morrissey Way, Greenwell Point in the State of New South Wales.

1.2 Give judgment that the first defendant pay the plaintiff the sum of $38,315.

1.3 Order that the said judgment be a first charge on the balance of proceeds of sale of the Greenwell Point property.


2. Order that the claim be otherwise dismissed.

3. Order that the cross-claim be dismissed.

4. Stand over the proceedings to Tuesday 23 October 2007 at 9.30am before me, for argument as to costs.

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