French v Bremner

[2020] NSWCA 339

Court of Appeal

Supreme Court

New South Wales

• Summary available

Medium Neutral Citation:

French v Bremner; Bremner v French [2020] NSWCA 339

Hearing dates:

3, 4 December 2020

Decision date:

18 December 2020

Before:

Meagher JA at [1];
Leeming JA at [2];
White JA at [118].

Decision:

1. Grant leave to Mr French to amend his notice of appeal to challenge the award of interest.

2. Dispense with the filing of an amended notice of appeal.

3. Allow Mr French’s appeal in part and set aside order 1 of the orders made on 31 October 2019, but otherwise dismiss the appeal.

4. Direct the parties to supply agreed calculations, or in the absence of agreement, calculations for which each contends, of the amount of interest at 5% upon the amounts totalling $3,148,718 lent by Dr Bremner, within 28 days of today, noting that this Court proposes to enter judgment against Mr French on Dr Bremner’s cross-appeal in the amount of $3,148,718 plus interest at the rate of 5%.

5. As against Ms Bakey, refuse leave to extend time within which to bring an appeal against the dismissal of the proceedings brought by Dr Bremner against her, and dismiss the cross-appeal insofar as it is brought against her as incompetent.

6. Order Dr Bremner to pay Ms Bakey’s costs of the cross-appeal.

7. As against Mr French, dismiss Dr Bremner’s cross-appeal.

8. Dismiss the balance of Mr French’s notice of motion filed 30 October 2020.    

9. Mr French to pay Dr Bremner’s costs of his notice of motion filed 30 October 2020 to adduce further evidence on appeal.

10. Subject to orders 6 and 9, there be no order as to the costs of the appeal and cross-appeal, with the intention that Mr French and Dr Bremner bear their costs of the appeal and cross-appeal.

Catchwords:

CONTRACT – oral contracts concerning debt, joint venture to exploit inventions and rural properties – primary judge rejected claims in contract – no claim advanced in equity for partnership or breach of fiduciary duty – such claim renounced by senior counsel appearing at trial – no error in primary judge declining to address such claim – no error in rejection of oral contracts – appeal dismissed

RESULTING TRUST – presumed resulting trusts – cross-appellant purchased rural lands and placed in joint names of him and first cross-respondent, or in sole name of second cross-respondent – primary judge found presumption of resulting trust rebutted – whether appellable error in so finding – testimonial evidence by cross-respondents – cross-appellant gave no evidence – one cross-respondent not cross-examined on her evidence of beneficial ownership – documents supported rebuttal of presumption – cross-appeal dismissed

Legislation Cited:

Civil Procedure Act 2005 (NSW), s 100

Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth), s 7

Partnership Act 1892 (NSW), s 30

Uniform Civil Procedure Rules 2005 (NSW), r 51.17

Cases Cited:

Agusta Pty Ltd v Official Trustee in Bankruptcy as Trustee of Estates of Gustavo Ferella and Angelo Ferella [2009] NSWCA 129

Bull v Lee (No 2) [2009] NSWCA 362

Calverley v Green (1984) 155 CLR 242; [1984] HCA 81

Carantinos v Magafas [2008] NSWCA 304

Despot v Registrar-General of NSW (No 2) [2013] NSWCA 332

Foundas v Arambatzis [2020] NSWCA 47

French v Bremner [2019] NSWSC 1033

French v Bremner (No 2) [2019] NSWSC 1504

French v Bremner [2020] NSWCA 299

McDermott v Black (1940) 63 CLR 161; [1940] HCA 4

Rahme v Benjamin & Khoury Pty Ltd (2019) 100 NSWLR 550; [2019] NSWCA 211

United Dominions Corporation Ltd v Brian Pty Ltd (1985) 157 CLR 1; [1985] HCA 49

University of Wollongong v Metwally (No 2) [1985] HCA 258; 59 ALJR 481

Category:

Principal judgment

Parties:

Andrew Boyd French (Appellant; First Cross-Respondent)
Christopher Bremner (Respondent; Cross-Appellant)
Gabrielle June Bakey (Second Cross-respondent)

Representation:

Counsel:
Mr French and Ms Bakey, self-represented
M Einfeld QC, A Harding SC (Respondent; Cross-Appellant)

Solicitors:
Johnson Winter & Slattery (Respondent; Cross-Appellant)

File Number(s):

2019/285092

Publication restriction:

Nil

 Decision under appeal 

Court or tribunal:

Supreme Court of New South Wales

Jurisdiction:

Equity

Citation:

[2019] NSWSC 1033

Date of Decision:

15 August 2019

Before:

Parker J

File Number(s):

2014/101136

Judgment

1. MEAGHER JA: I agree with Leeming JA.

2. LEEMING JA: Mr Andrew Boyd French appeals from a decision of the Supreme Court (Parker J) dismissing his cross-claim against Dr Christopher Piers Julian Bremner for breach of contract, and upholding Dr Bremner’s claim for repayment of monies lent to him. Dr Bremner cross-appeals from his Honour’s dismissal of that part of his own cross-claim which maintained that five parcels of land registered in the two men’s joint names, and one registered solely in the name of Mr French’s de facto wife, Ms Gabrielle Bakey, were held on a resulting trust for Dr Bremner.

3. For the reasons which follow, I propose that both the appeal and the cross-appeal be dismissed. Both sought to challenge factual findings made at trial – in the case of the appeal, whether there were any of the three oral agreements for which Mr French contended, and in the case of the cross-appeal, whether the presumption of a resulting trust had been rebutted. I have concluded that neither side has made out a basis to interfere with the findings made by the primary judge after a nine day trial.

Factual background

4. The factual background to this appeal is set out extensively at [62]-[227] of the primary judge’s reasons for judgment. An abbreviated summary will suffice for the purposes of this appeal.

5. Mr French is an inventor and property investor. Dr Bremner qualified as a medical doctor but appears to have made large sums of money working in London on the financial markets prior to meeting Mr French, and to have operated as an international investor with special interest in commercialising scientific discoveries and in acquiring and developing property.

6. Sometime between 1997 and 1999, Mr French invented a form of magnetic coupling between rotating drive shafts. His inventions are described and illustrated in the evidence. Essentially, they permitted the transmission of power in a way that was frictionless, or almost frictionless, through the repulsive forces of magnetism. Mr French exhibited his inventions in Australia and Europe. He applied for a provisional patent from the Australian Patent Office in September 1999, and subsequently obtained patent protection in various foreign countries under the Patent Co-operation Treaty.

7. In July 2000, Mr French arranged for a company now called The Magnetic Gearing & Turbine Corporation Pty Ltd, or “MGT”, to be incorporated in Australia, with himself as sole director and secretary. The company was used as a vehicle for fundraising and commercialisation of his invention.

8. Mr French and Dr Bremner first met in about March 2001 at Mr French’s farm north of Port Stephens where he lived with Ms Bakey. Dr Bremner visited for the purpose of seeing Mr French’s invention. By all accounts, he was enthusiastic about it. Mr French’s invention was displayed at exhibitions in Switzerland and Germany later in 2001.

9. That same year, Dr Bremner provided a loan of $335,000 to Mr French to develop his inventions, chief among which was the magnetic coupling technology. The loan was documented by a signed acknowledgment with Mr French’s letterhead stating: “This is to acknowledge that I have received the sum of $335,000.00 from Dr Chris Bremner as a loan to pursue my inventions”. In 2007, after some 5 years in which there was no contact between the two men, Dr Bremner advanced further large sums to Mr French for the same purpose, including in the form of regular payments to him, and in all the amount advanced to Mr French by Dr Bremner exceeded $3 million.

10. Mr French was also involved in property ventures. One involved the potential development of land near Port Stephens, which Mr French had mortgaged to Provident Capital Ltd, a financier, in May 2006 as security for a $1.935 million loan. The loan was repayable after six months and the interest rate was stated to be 17.3%, discounted to 11.3% if payment was made on time. Dr Bremner took over management of the debt on the Port Stephens land in 2009, paying a lump sum off the principal. He negotiated the discontinuance of proceedings Provident had brought against Mr French in 2009. However, the debt was never fully repaid, and in 2014, Provident (now in liquidation) sued Mr French to recover the debt (I shall return to this below).

11. Another venture between Mr French and Dr Bremner involved the acquisition and improvement of various properties in rural Victoria. Dr Bremner financed the purchase of eight parcels of land, providing almost all of the overall purchase price of about $4 million. Two of the parcels were registered in Dr Bremner’s sole name, one property (the Corringle Beach Homestead, known as the “Homestead parcel”) was registered in Ms Bakey’s name, and the remaining five parcels were registered in Mr French’s and Dr Bremner’s names as tenants in common in equal shares. The properties were used for running cattle and cultivating edible salt marsh plants.

12. In 2009, Mr French and Dr Bremner agreed to send Mr Radu Iliuta, a technician and inventor whom Mr French had met in Sydney more than a decade earlier, to France to commercialise the magnetic couplings invention in Europe. Based in Montpellier, Mr Iliuta promoted the invention and engaged in further technological developments, which were financed by Dr Bremner.

13. Dr Bremner ceased making regular funding payments to Mr French after December 2010, although he continued paying the interest on the Provident loan. The two men parted ways in April 2011, after Mr French and Ms Bakey began to suspect that Dr Bremner and Mr Iliuta were plotting to steal the invention. From that point onwards, Dr Bremner and Mr Iliuta continued the European venture by themselves.

14. In 2012, Mr French ceased paying the interest on the Provident loan, and the Port Stephens land was sold due to Mr French’s inability to repay the debt owed to Provident.

Procedural background

15. Provident sued Mr French for recovery of the debt he owed in April 2014. In March 2015 a consent judgment was entered in the amount of some $3.32 million. Thereafter, only the cross-claims were litigated in the proceedings. To those I now turn.

16. Mr French filed a cross-claim against Dr Bremner in September 2014 and Dr Bremner filed his own cross-claim against Mr French and Ms Bakey in October 2015. There was significant delay in the cross-claims coming to trial as a result of Mr French being subject to bankruptcy proceedings and difficulties in securing evidence from Mr Iliuta. Mr French’s cross-claim was substantially amended over almost five years before the trial. In its final form, it was confined to a claim for damages for breach of contract.

17. Two matters which were absent from the final form of Mr French’s cross-claim are presently relevant. The first is that claims for infringement of copyright which had been pleaded in some detail were abandoned. Had they been litigated and given rise to a matter in the appeal, this Court would have lacked jurisdiction: Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth), s 7(5). The second is that no claim for breach of fiduciary duty, or partnership, was made. I shall return to this below, but towards the beginning and towards the end of the trial, this was squarely raised with senior counsel then appearing for Mr French, and he unequivocally declined to advance any such claim. This is significant for Mr French’s appeal. Now appearing for himself, a great deal of his submissions alleged that he and Dr Bremner had been “partners”.

18. The allegations of breaches of contract which were advanced at trial on Mr French’s cross-claim arose out of three agreements between Mr French and Dr Bremner:

1. The first was said to be an oral agreement entered into in about March 2009, subsequently put into writing in September of that year, whereby Dr Bremner agreed to “buy” the Provident mortgage, in the sense of Dr Bremner assuming responsibility to discharge the mortgage debt or to keep Mr French indemnified against the mortgage liability. Mr French claimed some $3.32 million in damages representing the value of the judgment that Provident obtained against him.

2. The second was described in Mr French’s cross-claim as a “joint venture agreement” agreed orally in 2009 and 2010 relating to exploitation of the magnetic coupling invention in Europe. Mr French alleged that Dr Bremner agreed to incorporate a company in France for this purpose (MGT Europe), with Mr French having a 51% shareholding, Dr Bremner a 44% shareholding and Mr Iliuta a 5% shareholding. This never occurred. Mr French alleged that Dr Bremner breached the agreement by refusing to incorporate the company and by going into business with Mr Iliuta to the exclusion of Mr French. Mr French claimed more than $39 million in damages for breach of this alleged agreement, representing the lost profits of exploiting the invention in Europe.

3. The third agreement was labelled a “property maintenance agreement” in Mr French’s cross-claim, was said to have been made orally in 2009, and related to the rural properties in Victoria. Mr French alleged that Dr Bremner agreed to pay 50% of the costs associated with the properties which were registered in both their names. The amount claimed for breach of this alleged agreement was $128,198.60.

19. Dr Bremner’s cross-claim had two aspects. The first sought the repayment of roughly $3.15 million he said he provided as loans to Mr French or to associated third parties. Mr French admitted that he had received $3.1 million from Dr Bremner, but admitted only that a portion of that amount totalling $1.82 million was provided to him by way of loan, and did not admit that any of the monies, including the loans, were repayable.

20. Dr Bremner also claimed that his provision of almost all the funds for the purchase of the properties in rural Victoria gave rise to a resulting trust in his favour over those properties registered in the names of Mr French or Ms Bakey. He sought a declaration to that effect and an order that each of the properties be transferred to him, failing which he sought an order for the appointment of trustees for sale.

The decision of the primary judge

21. The trial was heard over nine days in May 2019 and a substantial judgment of some 477 paragraphs was delivered on 15 August 2019: French v Bremner [2019] NSWSC 1033.

The reasons of the primary judge for dismissing Mr French’s cross-claim

22. The primary judge found that none of Mr French’s three contractual claims was made out. His Honour concluded that Mr French’s evidence was to be treated “with considerable caution”, and noted the difficulties in a plaintiff’s seeking to make out a case based on oral dealings: at [41]-[43].

23. In relation to the alleged Provident mortgage agreement, his Honour found that there was no promise by Dr Bremner to discharge the mortgage or hold Mr French harmless against the mortgage debt, and that no consideration had been provided by Mr French in exchange for any such promise: at [435].

24. The primary judge also concluded that the alleged “joint venture agreement” for exploitation of the invention in Europe failed. His Honour found at [439] that the parties never reached concluded agreement on the terms of the proposal to incorporate a company in France, including on such essential matters as the terms on which the intellectual property would be licensed to the proposed company and the identity of its shareholders. His Honour also concluded at [440]-[444] that Mr French’s claim failed on the basis that if an agreement was reached, Mr French was not himself a party to it. Rather, the contracting party would have been MGT, the company he had previously incorporated in Australia, which Mr French had told investors was the ultimate owner and controller of the patent and intellectual property rights, and which he had put forward instead of himself to be the shareholder in MGT Europe. Still further, his Honour concluded that if there had been a joint venture agreement, Mr French had failed to establish any loss, stating at [449]-[450]:

“The Court has little if any evidence on which to work. What little evidence there is suggests that by late 2010 Mr Iliuta was heartily sick of Mr French and was not prepared to work in any organisation where Mr French had control. Dr Bremner was also reaching, if he had not reached, the end of his tether.

The history of Mr French’s attempts to commercialise the invention up to 2010, and after he fell out with Dr Bremner and Mr Iliuta in 2011, is one of attracting the interest of larger organisations but being unable to follow through with commercialisation. The reasons for this may be to do with limitations in Mr French’s invention, or Mr French’s lack of management skills, or a combination of the two. But it does not inspire any confidence that Mr French would have found the winning formula if only Dr Bremner had signed up to the incorporation of MGT Europe on the terms of the alleged joint venture agreement. I am not satisfied that if he had done so the result would have been any different.”

25. Mr French’s third contractual claim was also rejected by the primary judge. His Honour considered that any agreement between the parties was likely to have been to the effect that the farming activities on the Victorian properties were entirely on Mr French’s account, and that if that were wrong, then the farming would have been “in effect a 50/50 partnership between Dr Bremner and Mr French”. However, his Honour concluded that any partnership claim would not have resulted in the relief Mr French sought.

Reasons of the primary judge in relation to Dr Bremner’s cross-claim

26. The primary judge found that $3,148,718 was provided by Dr Bremner to Mr French or to associated third parties by way of loan, and that this amount was repayable by Mr French and outstanding: at [456]. His Honour gave judgment in Dr Bremner’s favour in that amount but added interest of $2,641,945 calculated at the rates in accordance with s 100 of the Civil Procedure Act 2005 (NSW). The calculation of interest was the subject of an application made by Mr French during the hearing to expand the notice of appeal.

27. In relation to Dr Bremner’s claims that the Victorian properties were held on resulting trust in his favour, the primary judge found at [467] that the presumption of a resulting trust arising from Dr Bremner’s provision of the bulk of the purchase money had been rebutted, having regard to the principles in Calverley v Green (1984) 155 CLR 242; [1984] HCA 81. This was in light of the following considerations:

1. a local Victorian firm of solicitors, Wards, acted for Mr French, and not solely for Dr Bremner in respect of the purchase;

2. Mr French paid the deposit, and the registration of the transfers of at least some of the properties was apparently done on his instructions;

3. one of the properties, “Lot 550”, was registered in Mr French’s name, but subject to an express trust for himself and Dr Bremner as tenants in common in equal shares (there was secondary evidence of a written declaration of trust);

4. Dr Bremner had not given any direct evidence of his intentions in relation to the properties, and had not sought to obtain any evidence from Wards on the question, whereas Mr French and Ms Bakey had given direct, uncontradicted evidence that Dr Bremner wanted the Corringle Beach Homestead to be registered in Ms Bakey’s name “essentially as a gift to her”; and

5. Mr French had given evidence, supported by contemporaneous documents containing admissions by Dr Bremner, that the pair intended to acquire the rural Victorian properties on a 50/50 basis.

28. In view of the failure of Dr Bremner’s resulting trust claim, and noting the disagreement between the parties, his Honour concluded that Dr Bremner was entitled to an order for the appointment of trustees for sale: at [473].

Mr French’s appeal

29. In view of the quantum in issue, Mr French’s appeal is as of right. By notice of appeal filed on 15 November 2019, Mr French raises nine grounds of appeal, although they were not addressed discretely in his written submissions.

30. By notice of motion filed on 30 October 2020, a little over a month before the appeal was heard, Mr French sought leave for additional evidence, contained in numerous annexures to an affidavit made by him on the previous day, to be received on appeal. The Court of Appeal stood over one aspect of that application to the hearing of the appeal (this concerned a webinar dated 6 September 2020) in circumstances described in French v Bremner [2020] NSWCA 299 at [10]. The balance of the application was dismissed.

31. On the second day of the appeal, Mr French provided a document identifying what he sought to obtain from the webinar. The Court advised that it would rule on the application at the same time as it delivered judgment on the appeal.

Mr French’s written submissions

32. Mr French’s first ground of appeal was that the primary judge:

“misdirected himself on the evidence of partnership before him, and was not taken by counsel, to binding High Court Precedents on Partnership, … did not understand the technical evidence or significance of the documents put in evidence in front of him, in respect of Patents, and failed to accept that a properly constituted partnership was in issue”.

33. Ground 3 asserted that there was “error in Law as The Partnership Act … applies to the facts but is not cited in the Judgment”, and ground 9 asserted that “[t]he judgment fails to show that all monies contributed by Bremner were monies paid into the partnership. There was no loan agreement, no time to repay and any monies to be recovered were to come from the profits of the projects.” The grounds relating to the alleged partnership were the chief grounds towards which Mr French’s written submissions were directed, with the balance re-agitating what had been put to the primary judge.

34. Mr French contended that the primary judge should have acknowledged that a partnership existed between him and Dr Bremner. In Mr French’s submission, the partnership involved a relationship of trust between the two men and an acknowledgement that they were to be partners in both the real property and the patents, that Mr French provided the patents, know-how and work, while Dr Bremner was to finance the partnership until the invention “came to fruition”. Mr French contended that Dr Bremner breached his fiduciary duties and his duty under s 30(1) of the Partnership Act 1892 (NSW) by abandoning the partnership, trying to lodge new patents in his own name, and setting up a new business without Mr French.

35. In support of his submission, Mr French relied on a handwritten memorandum which he calls a “declaration of trust document” and which he maintains was written by Dr Bremner. The document was signed by both men and dated 13 September 2009. It is convenient to set out its text in full:

“I Andrew French hereby confirms [sic] that Dr Christopher Bremner my generous financial backer of the last 10 years has equal ownership with myself of MGT Magnetic Gearing and Turbine Co and its associated patents and my patents in the area of magnetics. Dr Christopher Bremner is also confirmed to be my equal partner in the ownership of the 360 acres of land registered to me near North Arm Cove at Port Stephens N.S.W. Australia after a value of 4 million”.

36. The reliance now placed on appeal by Mr French upon this memorandum is diminished by his evidence (reproduced at [163] of the primary judge’s judgment) that he was drunk at the time of signing it. An email sent by Mr French to Dr Bremner dated 13 June 2010 and headed “Duress agreement 50/50” stated:

“The agreement you put in front of me in your flat at Darling Point when I was drunk was signed under Duress.

I told you Gabi my partner had to see it and she has not had that chance as of yet.

We have not spoken about that since then and she has on a number of occasions tried to talk to you about –

1/ Our loan account to you.

2/ The agreement you put in front of me relating to 50/50 with no consideration.

3/ A number of farm issues that you decided on behind our backs.

The land is not 50/50 the titles show that.

Please contact me ASAP to discuss things, I have tried to call you.

YOU DO NOT HAVE ANY AUTHORITY TO BE AT ANY MGT MEETINGS.”

37. I shall return below to Mr French’s pleading in relation to the handwritten memorandum. Mr French also relied in his written submissions on an email sent to him by Dr Bremner, dated 26 July 2010, in which Dr Bremner wrote:

“I do really appreciate your input on everything and think you have been doing a brilliant job. You know I have always tried to do my very best as well, and think our partnership has been very strong, productive and we have really covered each other[’]s back and have contributed greatly to each other, it is a great partnership and I think with [Mr Iliuta’s] input as well we will have success and our technology will change the engineering world”. (Emphasis added)

38. Mr French submitted that discussions consistent with a partnership relationship continued for years and that he assumed Mr Bremner would continue to fund the rise of MGT Europe until it could fund itself. Mr French says “[t]his was mostly done through oral discussions and sometimes through email and was always done on a handshake with no set time for reconciliation”. He says he continued to assume the partnership was solid on the basis of communications in 2010 in which Dr Bremner told him he was doing “a great job” and that the following year would be their “best yet as our combined efforts bring dreams to reality”.

39. He also relies on an email from Dr Bremner of 12 January 2011, which includes this passage:

“Some time later you informed me you had paid a deposit on a farm in Orbost but could not settle, I said I would help you settle if we would be partners in the property. Subsequently we invested in buying a number of farms together some in partnership some individually including a home in your wife[’]s name.”

40. A series of emails in evidence between Dr Bremner and Mr Iliuta, dating from October 2010, and in which Mr French was not included, were said in Mr French’s written submissions to constitute “a side communication” whereby he was kept “out of the loop”. The emails related to steps that needed to be taken to advance the business venture, and included discussions concerning registration of MGT Europe in France, setting up a factory and machinery, paying wages and financing the venture.

41. Mr French’s submission on these grounds boils down to a contention that a partnership existed between the two men and that he suffered significant detriment caused by Dr Bremner’s failure to fulfil his partnership obligations in relation to both the patents and the land.

42. In relation to Dr Bremner’s claim for repayment of monies he loaned to Mr French, which the primary judge upheld, Mr French accepted that Dr Bremner advanced him money, but asserted that apart from the initial loan in 2001, documented by an acknowledgment, all other advances were done “on a handshake”, it being agreed that the monies advanced “would be worked out later when MGT was profitable”. Mr French submitted in writing that his Honour “should have found that all monies advanced to French by Bremner, were paid into the partnership and that the partnership land and intellectual property were collectively held upon trust until accounts were taken”.

43. Mr French’s notice of appeal also invoked the doctrine of part performance and an accord and satisfaction (grounds 4 and 6). Mr French contended that both principles apply to the facts of his case, but that neither was cited by the primary judge. The written submissions also stated that Dr Bremner agreed to an assignment of the Provident debt to himself, and led him to believe that it had taken place, but then did not go through with it, although he continued paying the interest and communicating with Provident without Mr French’s knowledge.

44. Mr French further submitted that the assignment agreed to by Dr French and Provident constitutes an example of the principle of accord and satisfaction. He asserted that Dr Bremner and Provident agreed that, on assignment of the debt to Dr Bremner, the amount of the debt would be reduced, that Dr Bremner would pay an initial amount of $600,000 with the balance payable by him within a further 60 days. At its core, Mr French’s submission was that Dr Bremner “took on the responsibility for the debt with the assignment and his promises to Provident”, and that “[t]he fact that [Dr] Bremner did not keep his promise should not be at the detriment to Mr French who accepted in good faith what [Dr] Bremner had told him about his dealings with Provident and the fact that he had bought the Mortgage and Mr French did not have to worry about it anymore”.

Dr Bremner’s written submissions

45. In his written submissions, Dr Bremner emphasised that “the existence and terms of the claimed agreements [between the two men] depended upon the acceptance of evidence given by Mr French of conversations that were said to have occurred some ten years before the proceedings were heard”, and drew attention to the primary judge’s cautious approach to Mr French’s evidence. Dr Bremner submitted that neither Mr French’s notice of appeal nor his submissions on appeal identified any error on the part of the primary judge.

46. The essence of Dr Bremner’s written submissions in respect of Mr French’s appeal was as follows:

“Mr French effectively seeks to rerun the whole of his case below, in a new forum, and in a different way (for example, by introducing claims of fiduciary duty abandoned at trial), without grappling with why the primary judge – who had the benefit of seeing Mr French give evidence in the witness box over three days – was wrong to reject his evidence on the decisive points. Dr Bremner opposes Mr French’s attempt to raise in this Court claims that were not raised, or were expressly abandoned, at the hearing. In particular, Mr French should not have leave to raise on appeal equitable claims for breach of fiduciary duty when (a) no such claim was pleaded and (b) after consideration, a proposed application to introduce fiduciary and other equitable claims was expressly abandoned.”

47. In answer to Mr French’s submission that the primary judge erred by failing to treat the matter as a partnership dispute involving breach of fiduciary duties, Dr Bremner submitted that the assertion failed because any “partnership” pleaded and argued by Mr French at trial was no different from or wider than the “joint venture agreement” which the primary judge concluded did not exist. To the extent that Mr French on appeal alleged breach of fiduciary duty, Dr Bremner submitted that this was an impermissible attempt to agitate new arguments, and noted that when such a claim was the subject of a proposed amendment during the trial, senior counsel for Mr French expressly declined to make any application to introduce fiduciary or other equitable claims.

48. In any event, Dr Bremner submitted that it was Mr French’s case below that the parties were not equal partners at all, “but rather that Dr Bremner would have no share in the Australian company, MGT Australia, and only a minority (44%) interest in MGT Europe.”

49. In respect of the grounds of appeal relating to the doctrine of part performance and an accord and satisfaction, Dr Bremner submitted that these contentions were never pleaded or argued by Mr French below, and should not be permitted to be argued for the first time on appeal. As to the doctrine of part performance, Dr Bremner submitted that in any case, the argument failed to address the primary judge’s rejection of Mr French’s evidence as to the alleged Provident agreement, or his Honour’s conclusion that Mr French supplied no consideration. As to the argument based on accord and satisfaction, Dr Bremner submitted that it was “entirely unclear how the doctrine could have any application” as “[t]he essence of accord and satisfaction is the acceptance by the plaintiff of something in place of his cause of action”, citing McDermott v Black (1940) 63 CLR 161 at 183; [1940] HCA 4, and that there was no relevant plaintiff who had given up an existing cause of action in this case.

Resolution of the appeal

50. Precisely why the litigation at first instance took the course it did is neither clear on the face of the appeal books nor relevant to the issues which arise. Mr French was represented by solicitors and senior counsel. The record reveals that important forensic decisions were made during the litigation, including as to which causes of action were or were not chosen to be advanced at trial. Mr French is bound by the way his trial was conducted. His appeal is by way of rehearing, but it is a rehearing of what took place at first instance, rather than some different trial raising different issues or different causes of action. As was said by Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ in University of Wollongong v Metwally (No 2) [1985] HCA 258; 59 ALJR 481 at 483:

“It is elementary that a party is bound by the conduct of his case. Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against him, to raise a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had an opportunity to do so.”

51. Mr French complained that he and Dr Bremner had been partners, and that on that basis there should have been judgment in his favour.

52. I can see why Mr French makes that complaint. Equitable obligations may attach to joint venturers or partners who embark upon their joint enterprise prior to finalising the contract which founds their relationship: United Dominions Corporation Ltd v Brian Pty Ltd (1985) 157 CLR 1; [1985] HCA 49; see by way of recent example Rahme v Benjamin & Khoury Pty Ltd (2019) 100 NSWLR 550; [2019] NSWCA 211 at [91]-[97].

53. However, that was not the case which was run at trial. What is more, any such case was explicitly disavowed.

54. Relatively early in the trial, in response to an objection to Mr French’s affidavit, the trial judge questioned whether the material subject to the objection would go to equitable causes of action and equitable compensation or an account of profits. Mr Einfeld QC, who appeared for Dr Bremner at first instance and in this Court, responded that such causes of action had not been pleaded. The primary judge suggested to senior counsel then appearing for Mr French that he review his pleadings overnight to see whether the relevant facts had been pleaded in relation to, inter alia, the equitable claims and whether a reformulation was required. Counsel took up that suggestion.

55. Early on the following day, counsel for Mr French provided a partially incomplete amended pleading raising equitable causes of action and associated relief. The primary judge stated that when he raised the issue of equitable relief the previous day, he had forgotten that no such case was pleaded and indicated that he had not contemplated a complete revision to the pleadings to raise equitable causes of action. Mr Einfeld foreshadowed that if an application to amend were made, defences based on laches, acquiescence and unclean hands would be pleaded in response.

56. The matter was thereafter left to rest for some seven days. During that time, Mr French and Ms Bakey were cross-examined, the former over some three days. Towards the conclusion of the trial, the potential amendment of the pleadings to raise the equitable causes of action was revisited and deferred to the following Monday. Mr Einfeld again foreshadowed an objection. On that morning, the proposed application to amend was abandoned.

57. Since ultimately no application was made, it is difficult to predict whether it would have been granted and, if so, on what terms (including as to an adjournment at Mr French’s expense). For the benefit of Mr French, I should make it plain that so far as I can see it would have been difficult to prevent Dr Bremner from advancing a discretionary defence based, at the least, upon delay, if there were a proper basis for contending that in the years since their business relationship broke down, Mr French knew or ought to have known that Dr Bremner had been attempting to exploit the invention. Damages at common law for breach of contract are available as of right. However, insofar as Mr French might have sought equitable compensation or an account of profits for breach of a fiduciary duty, then Mr Bremner would have been entitled to rely on equitable defences which were unavailable against a contractual claim. Another way of explaining the point is that a plaintiff seeking damages for breach of contract may wait for 5 years and 11 months before bringing a claim at common law. However, if the same events give rise to a claim for breach of fiduciary duty, then the plaintiff may well have to explain an extensive delay, and equitable relief may be denied altogether or reduced.

58. I can also see difficulties in relying on a defence of unclean hands, although on the face of the materials in the appeal books, it is not clear what the gravamen of that defence would be. The impropriety on which the defence is founded must have an immediate and necessary relation to the equitable claim: see Carantinos v Magafas [2008] NSWCA 304 at [58]-[59].

59. What is entirely unclear is why no claim in partnership or based on breach of fiduciary duty had been made against Dr Bremner in the years prior to the trial in 2019.

60. A further aspect of the way in which choices were made at trial concerns the handwritten memorandum of September 2009 (of which Mr French later complained that he was drunk when he signed it). That document was particularised in support of the “joint venture agreement” in Mr French’s further amended cross-claim (paragraph 13(h)). However, in the second further amended cross-claim, which was the iteration of the pleading which went to trial, that particular was deleted. This was raised during the hearing and Mr French stated that he did not know why it had been struck through. I accept Mr French’s response. However, it is another indication of the way in which Mr French is seeking on appeal to advance a claim which was disavowed at a trial where he was represented by senior counsel.

61. It is apparent that forensic decisions have been made based on the case that was in fact advanced. Those decisions will have included the way in which Mr French was cross-examined, and the decision not to call Dr Bremner. It is a very clear case where Mr French’s appeal must be confined to the causes of action he litigated at trial.

62. That deals with the main submission advanced by Mr French. No direct challenge was made to the factual findings of the primary judge, rejecting each of the three oral contracts alleged. It is difficult to see how any challenge could be made, given the “considerable caution” with which the primary judge’s treated Mr French’s evidence.

63. Insofar as Mr French sought, in both his written and oral submissions, to rely on part performance and accord and satisfaction, it is sufficient to say that neither doctrine casts any doubt on the factual conclusion that there were no oral contracts as alleged by him.

Interest on the judgment debt

64. The solicitors who had retained senior counsel who had appeared for Mr French at trial had ceased to act by October 2019 when his Honour came to make substantive orders in favour of Dr Bremner, as was recorded in French v Bremner (No 2) [2019] NSWSC 1504 at [2]. The judgment went on to deal with the money judgment ordered at [5]:

“The first aspect of the orders requiring mention is the calculation of interest on the judgment for approximately $3.15 million which Dr Bremner obtained on his cross-claim (see my judgment at [475(1)]). The interest calculations were given to Mr French before the hearing and he has raised no objection to them. Accordingly, I will award prejudgment interest pursuant to the Civil Procedure Act 2005, s 100 in the sum of $2,641,945.”

65. Dr Bremner had, in his cross-claim, sought pre-judgment interest at the rate of 5% or alternatively pursuant to s 100 of the Civil Procedure Act. There are references in the evidence adduced at trial to Dr Bremner being entitled to interest at 5%. For example, Exhibit 7 was a document describing the history and background of MGT, including under the heading “Financing to date” this paragraph:

“Christopher Bremner is a person who has loaned Andrew a large sum of money on a hand shake. This money has no time to be paid back and it is loaned at 5% interest. It may be converted to stock at a later date if and when the accountants think it is wise too [sic].”

66. The document appears to have been attached to an email sent by Mr French to Mr Iliuta and copied to Dr Bremner dated 19 August 2010. A PricewaterhouseCoopers file note made shortly thereafter, dated 24 August 2010, appears to record Mr French referring to a debt of $3.5m with interest at “potentially 5%”.

67. That evidence was consistent with other references to an interest rate of 5% present in the evidence. In an email sent to Dr Bremner on 23 December 2009, Mr French said “I thought it was our money and I was paying you back at 5% as agreed and that all Gabi’s and my hard work was making you money”. Emails sent in January 2011 also disclose reference to an interest rate of 5%. Mr French’s email to Dr Bremner dated 11 January 2011 stated that “Our original agreement was as a loan at 5% interest all on a handshake”, while another email of the same date, sent by Mr French to Mr Iliuta and copied to Dr Bremner, stated that “The original deal was as a loan 5% interest with no shares”.

68. Section 100(3)(b) of the Civil Procedure Act curtails the scope of the power conferred on the Court to order pre-judgment interest. It provides that the section “does not authorise the giving of interest on a debt in respect of any period for which interest is payable as of right, whether by virtue of an agreement or otherwise”. No finding was made by the primary judge, which is understandable given the way the issue arose. However, this Court may make further findings of fact in the course of resolving an appeal. The evidence powerfully supports a finding that the money lent by Dr Bremner to Mr French attracted interest at the rate of 5% per annum. That appears on the face of Dr Bremner’s cross-claim, and in the contemporaneous documents reproduced above.

69. Because Dr Bremner was entitled to interest at the rate of 5%, s 100 did not authorise the award of interest at Court rates: see Agusta Pty Ltd v Official Trustee in Bankruptcy as Trustee of Estates of Gustavo Ferella and Angelo Ferella [2009] NSWCA 129 at [39]-[44]; Bull v Lee (No 2) [2009] NSWCA 362 at [28]-[29]; Despot v Registrar-General of NSW (No 2) [2013] NSWCA 332 at [4].

70. There is nothing to suggest that this was drawn to the attention of the primary judge. In circumstances where Dr Bremner’s lawyers were dealing with an unrepresented litigant, and where the order made by the primary judge on its face discloses an error of law, that error should be cured by this Court in the course of hearing and determining the appeal.

71. Dr Bremner opposed Mr French’s oral application to amend his notice of appeal to challenge the award of interest. But the issue was raised on the pleadings below and ought to have been brought to the primary judge’s attention by Dr Bremner’s lawyers.

72. The need for filing an amended notice of appeal can be dispensed with.

73. Mr French should have leave to challenge the award of interest at the rates prescribed by s 100 of the Civil Procedure Act.

74. It is not clear to me that the materials in the appeal books permit the calculation of interest. The directions I propose will permit the parties to be heard as to this.

The application to adduce further evidence

75. The webinar contains material which would be arguably relevant to the causes of action based on partnership and breach of fiduciary duty which were at the forefront of Mr French’s submissions. For the reasons given above, this appeal does not extend to those causes of action.

76. The webinar does not cast any doubt on the rejection of the three oral contracts (to be fair, I did not understand Mr French to contend that it did). It follows that it has not been shown to be relevant to the issues arising on appeal. I propose that the application to adduce it as further evidence on appeal be rejected.

Dr Bremner’s cross-appeal

77. By notice of cross-appeal filed 29 November 2019, Dr Bremner raises four grounds of cross-appeal, two as against Mr French and two as against Ms Bakey. All four grounds may be reduced to a contention that the primary judge erred in concluding that the presumption of resulting trust in respect of the Corringle Beach Homestead registered in Ms Bakey’s name, and the five properties in rural Victoria registered in Mr French’s and Dr Bremner’s names, had been rebutted.

78. There was no issue as to the applicable principles. They were recently restated in Foundas v Arambatzis [2020] NSWCA 47 at [47]-[51] by White JA, with the agreement of Bell P and Basten JA. Most pertinently for present purposes is what was said at [51]:

“The presumption of a resulting trust may be rebutted by evidence as to the parties’ actual intentions, but does not yield to slight circumstances (Shepherd v Cartwright [1955] AC 431 at 445; Charles Marshall Pty Ltd v Grimsley (1956) 95 CLR 353 at 365; [1956] HCA 28; Brown v Brown (1993) 31 NSWLR 582 at 596). In principle, the presumption should be less strong where land is conveyed to the purchasers as tenants in common in defined shares. Nonetheless, the decision of this court in Ryan v Dries shows that the presumption of a resulting trust applies, whether the land is transferred to one party only, or to both parties as joint tenants, or to both parties as tenants in common.”

79. Dr Bremner accepted that the fact that most of the properties had been conveyed to himself and Mr French as tenants in common told against the presumption. But his main point was that the evidence was insufficiently certain and concrete to displace the presumption. At its heart, Dr Bremner’s submission was that “[t]he primary judge erred in concluding that the oral and documentary materials were sufficient to vest in Mr French and Ms Bakey an entitlement to any interest in those properties”.

Ms Bakey’s preliminary objection to the “cross-appeal”

80. Ms Bakey raised a preliminary point that the cross-appeal was out of time insofar as it sought to set aside the order made on 15 August 2019 dismissing the claim against her. On that day, Mr French’s cross-claim was dismissed, and his notice of appeal was filed on 15 November 2019, within the time permitted by the rules (noting that a notice of intention to appeal had been served). Dr Bremner’s cross-appeal was not filed until 29 November 2019. Insofar as the cross-appeal was against Mr French, it was within time (noting that a cross-appellant whose appeal is as of right has an additional 14 days to file a notice of cross-appeal after the filing of a notice of appeal: UCPR r 51.17(2)(b)). However, Ms Bakey was completely successful at first instance and strictly speaking, Dr Bremner needed to appeal, rather than to cross-appeal, against entry of judgment in her favour, for which purpose time expired on 16 November 2019.

81. Ms Bakey’s point is sound, but it does not determine the outcome. There is power to extend the time for bringing an appeal. There is an overwhelming case for doing so, in a case such as the present, where what is required is a 13 day extension, in a period of time throughout which Ms Bakey was on notice that a cross-appeal might be filed in relation to five of the six properties in question against Mr French. It was not suggested that any material prejudice was incurred by the fortnight’s delay, or that she had changed her position in some way in reliance on the expiration of the time for an appeal in the 13 days before the cross-appeal was filed, during which time Mr French was at risk of a cross-appeal as of right. After the application was made, the Court indicated that the cross-appeal against Ms Bakey would be resolved on its merits.

The merits of the cross-appeal against Ms Bakey – Lot 551 Corringle Road

82. Lot 551, which was known as the “Homestead” parcel, was purchased by Mr Bremner using funds from Ward’s trust account. It was placed in Ms Bakey’s name.

83. The primary judged addressed this at [465]:

“In this case, there is the direct evidence of Mr French and Ms Bakey that Dr Bremner expressly wanted for the Corringle Beach Homestead parcel to be registered in Ms Bakey’s name, essentially as a gift to her. That evidence may be self-serving but Dr Bremner could have tried to contradict it and he has not. His counsel did not even mount a challenge to it.”

84. The evidence to which his Honour referred was at paragraph 34 of Ms Bakey’s affidavit of 27 June 2016:

“I recall a telephone conversation with Bremner in which he said to me words to the following effect ‘Because all the businesses and other properties are in Andrew’s name it would be a lot safer for this property to be put in your name only. That will give you and the kids security’. This property settled near my birthday after Bremner had paid the balance of the purchase price. Bremner telephoned me to tell me about this. He told me that he had arranged with Ward’s solicitors that this property would be registered in my name. I specifically recall words to the effect ‘What a great birthday present for you’. I agreed and thanked him. There was never any discussion between myself and Bremner regarding my holding this property in trust for him.”

85. It was common ground on the appeal that, as his Honour recorded at [313], Ms Bakey was not asked about that conversation in cross-examination.

86. Dr Bremner submitted that the evidence adduced by Ms Bakey and Mr French supporting a gift of the Homestead parcel to Ms Bakey was “extremely scant”. In Dr Bremner’s submission, the evidence of any conversation to the effect that the property was a birthday present related to events that took place many years previously, was unsupported by any contemporaneous record, was therefore subject to the caution which must be applied to distant recollections, had to be assessed in the context of the primary judge’s finding that her evidence was questionable and to be treated with reserve, and was controverted by an email she had written in September 2011, in which she stated that Dr Bremner’s purchase of the property was “not a gift” and was not “overly generous”.

87. Dr Bremner submitted that that email constituted an “express and specific denial of gift”, and told against Ms Bakey’s and Mr French’s characterisation of the property being purchased in her name as a gift to her beneficially. He submitted that instead the email, if anything, pointed to the conclusion that the purchase price was advanced by him by way of loan to be repaid when MGT became profitable. However, his own submission on the cross-appeal was that his funds “were not provided as a quid pro quo for anything, nor as a loan” and were “not a gift”. He also called mistaken Ms Bakey’s reliance on the name in which the Homestead parcel was registered, on the basis that “[i]t is in virtually every case (other, perhaps, than where fraud is alleged) that a resulting trust will not be registered partly, or at all, in that contributor’s name”.

88. In answer to Ms Bakey’s submissions relating to his failure to give evidence at trial, Dr Bremner noted that as his contribution to the purchase price was not in issue, Ms Bakey bore the burden of disproving the presumption of resulting trust that therefore arose, and that the evidence she and Mr French adduced did not reach the requisite level of establishing a definite intention to endow Ms Bakey with the full beneficial interest in the property. In those circumstances, it was said, there was no need for Dr Bremner to give evidence, as the presumption had not been displaced even on Ms Bakey’s and Mr French’s own case.

89. Dr Bremner’s submission on the cross-appeal, in so far as it related to the Homestead parcel, was encapsulated in writing as follows:

“Overwhelmingly, the evidence adduced to rebut the presumed resulting trust arising from payment of the purchase price did not suffice to shift the presumption. It was, at best, unclear, tenuous and unsatisfactory. Taken as a whole, the evidence tendered by Ms Bakey and Mr French was internally inconsistent and unreliable. The presumption arising from Dr Bremner’s payment is not to be lightly displaced and the evidence fell very much short of the level required to displace it.”

90. At its core, Ms Bakey’s submission in response to the cross-appeal was as follows:

“The evidence before the court overwhelmingly shows that Dr Bremner knew what the deal was at the time between the parties regarding the properties and this was reflected in the way that the properties were subsequently registered.

… There was never any discussion between the parties regarding holding the properties on trust for Dr Bremner. Why would they do that? They would not put their heart and soul into a place to give it back to Dr Bremner later. In the last 13 years, Dr Bremner has been to the property only 3 times. Ms Bakey and Mr French have looked after their own properties and the properties of Dr Bremner for all this time.”

91. There was no evidence from Dr Bremner disputing that he told Ms Bakey that placing the property in her name would give “you and the kids security”. There was no dispute that he had said “What a great birthday present for you”.

92. There was a great deal of other documentary evidence supporting an intention to rebut the presumed resulting trust that arises when a person who pays for property puts it in the name of another.

93. But what has already been said is amply sufficient to resolve the cross-appeal against Ms Bakey. It must be borne in mind that the primary judge had the advantage of seeing Mr French and Ms Bakey give evidence, the former over some three days. The finding that there was an intention for Ms Bakey to have beneficial as well as legal ownership of the Homestead parcel was a finding of fact, in respect of which this Court should give deference to the primary judge.

94. In light of the absence of any challenge to Ms Bakey’s sworn evidence of what Dr Bremner had told her when the Homestead parcel was acquired, Mr Einfeld maintained that the conversation could be understood only as a reference to the legal title of the Homestead parcel, as opposed to its beneficial ownership. I cannot agree. If it were to be understood that way, the statement would be nonsensical. How would bare legal title give Ms Bakey and the kids “security”? How would it be a “great birthday present”? In any event, that is at best a strained meaning to give to the language used.

95. As mentioned above, Mr Einfeld also pointed to an email from Ms Bakey. At first he said it was an admission by her. He pointed to her email dated 4 September 2011 in which she said, “It was not a gift, you were not being overly generous”.

96. But that submission takes words out of context. It is not clear that Ms Bakey was referring to the Homestead parcel at all, and even if she were, her point was that there had been a loan of funds rather than a gift. The passage in its context is as follows:

“We have made you a considerable amount of money with the property purchases that you got involved in with us. We had all those blocks at corringle on a delayed Settlement before you even got involved with them. You have always been the one to jump on our bandwagon. When Andrew showed you the picture of corringle, you wanted to be a part of it. You know what the deals were with yourself and Andrew. You lent the money to buy the land and Andrew will pay you back the money lent when MGT is at a more profitable stage. You trusted in MGT back then or you would not have lent the money. It was not a gift, you were not being overly generous. It was a well executed plan of attack. You have been making money all along with astute land purchases introduced by Andrew and always stood to get your money back. Stop patting yourself on the back and making yourself out to be someone that you are not. It is a two edged sword with you Chris and you keep changing the rules and turning greedy like a spoilt brat and wanting to take it all back for yourself. We are the ones that have done all the hard work. We were the ones that have spent all\ the hours in the car travelling between NSW and Vic to keep the whole show rolling. Don’t you dare claim that it is all yours because you lent us the money. Stop it right now!!

That you own everything is an absolute insult. You lent us the money to buy it. You and Andrew had a deal regarding the land and other things, that is between you both and you are the one that is reneging on all deals. That is your agreements with us and your agreements with MGT.”

97. It will be seen that (a) the words “It was not a gift” were written in the context of contrasting the position with a loan, and (b) when Ms Bakey turned to referring to the properties, she unequivocally denied that they were owned by Dr Bremner.

98. The cross-claim against Mr Bakey is close to hopeless, if it is not indeed hopeless. For that reason, no basis has been established for even the short extension of time that Dr Bremner requires. Without the extension of time, the cross-appeal is incompetent, and should be dismissed on that basis.

99. Ms Bakey is a litigant in person, and the ordinary costs order which I propose should provide a complete indemnity to her for disbursements she has incurred in responding to the cross-appeal. In the absence of any evidence of her incurring legal expenses, the issue of whether Dr Bremner should pay Ms Bakey’s costs on an indemnity basis does not arise.

The cross-appeal against Mr French

100. Dr Bremner’s written submissions made the point that proof of registration of a property in a name different from the person providing the purchase price constitutes the starting point of the analysis as to ownership of the property, rather than the end point. It followed, in his submission, that in view of his provision of the bulk of the purchase price for the properties registered in his and Mr French’s names, it was for Ms Bakey and Mr French to demonstrate that the presumption of resulting trust had been rebutted on the evidence.

Lot 550

101. Lot 550 adjacent to the Homestead parcel must be addressed discretely, in view of the primary judge’s conclusion that the existence of an express declaration of trust over this property was “flatly inconsistent” with Dr Bremner’s claim of a resulting trust in his favour. Dr Bremner submitted in writing that no such declaration of trust was in evidence, and stated that the primary judge’s inference of such a declaration of trust “appears to have arisen from the solicitors’ letter of 29 September 2008”.

102. In oral submissions, Mr Einfeld came close to acknowledging that Dr Bremner’s claim was especially weak in relation to lot 550.

103. It may be inferred from the documents that there were in fact two transfers of lot 550: first to Mr French in his own name, and then by Mr French into his and Dr Bremner’s names as co-owners. The evidence discloses that the second transfer did not attract ad valorem stamp duty, on the basis that there was an existing trust in favour of Mr French and Dr Bremner. This is, as the trial judge emphasised by his words “flatly inconsistent”, powerful evidence that in fact Mr French did not hold lot 550 on a presumed resulting trust wholly in favour of Dr Bremner. Dr Bremner personally signed the second transfer, which is dated 16 February 2009, and which stated that the consideration for the transfer was “entitled in equity”.

The other four properties registered in the names of Mr French and Dr Bremner

104. The other properties registered in Mr French’s and Dr Bremner’s joint names were not the subject of any formal declaration of trust. Dr Bremner submitted in writing that the primary judge erred in accepting evidence from Mr French, said to be reinforced by contemporaneous documents, of an agreement to acquire the properties “on a 50/50 basis”. Essentially, Dr Bremner’s submission was that the oral discussions and written communications between the two men were directed solely to the question of registration, not to the ultimate beneficial ownership of the properties. In this respect, Dr Bremner noted the references in Mr French’s affidavit of 27 June 2016 in which he gave evidence that the two men intended that the properties “be registered in our joint names – 50-50”.

105. Mr French for his part placed reliance on contemporaneous emails, including one from Mr French to Dr Bremner on 6 May 2008 in which Mr French wrote “I have offered you half … when you said we would go 50/50 in all the land that I found”, and one from Dr Bremner to a third party dated 11 January 2011, in which Dr Bremner wrote “my original agreement with French is 50 50”.

106. There was also Dr Bremner’s email of 12 January 2011, parts of which have been reproduced above, referring to “we invested in buying a number of farms together some in partnership some individually”. The email continued “Without me [it is] likely you would have lost your farm, magnet business and your father his home, instead you have a portfolio of valuable properties”.

107. Dr Bremner in reply submitted that Mr French’s assertions of fact were not referable to any evidence before the court below. Specifically, in relation to the contemporaneous emails relied on by Mr French, Dr Bremner submitted they do not rise any higher than the evidence of conversations between the two men at around the same period, which, he submits, were directed to issues of registered title, not beneficial ownership. Further, Dr Bremner pointed to other emails said to be inconsistent with Mr French’s enjoying beneficial interest in the properties, including an email from Mr French to Dr Bremner of 23 December 2009, in which Mr French wrote “I suppose Iam [sic] not 50/50 anyway”.

108. Altogether, Dr Bremner submitted that the evidence as to the ownership of the rural properties registered in the two men’s joint names was “confused, disjointed and nebulous” and did not rise to the requisite level of a “definite and clear intention to confer on Mr French a 50% interest in valuable properties for which he paid no consideration”.

109. I am unable to accept Dr Bremner’s submission. There is the fact that the properties were placed in the men’s joint names. There is the testimonial evidence of Mr French and Ms Bakey. There are relatively contemporaneous documents supportive of Mr French having a beneficial interest, rather than a mere legal title, to the properties. And there is the fact that Dr Bremner chose not to give evidence to the contrary. No basis has been made out to interfere with the factual findings made by the primary judge.

110. For completeness I note that Ms Bakey and Mr French each also filed a notice of contention, on 10 and 13 December 2019 respectively. It is not necessary to summarise either document, in light of the outcome of Dr Bremner’s cross-appeal.

Orders

111. For those reasons, I propose that Mr French be granted leave to amend his notice of appeal in respect of the award of interest. The appeal should be allowed in part in relation to the award of interest but otherwise dismissed. The cross appeal should be dismissed. The balance of Mr French’s notice of motion dated 30 October 2020 (which sought to adduce into evidence the webinar) must be dismissed.

112. The ordinary rule in civil litigation is for costs to follow the event. Applying that course, Mr French would pay Dr Bremner’s costs of the appeal, and Dr Bremner would pay Mr French’s and Ms Bakey’s costs of his cross-appeal. However, I think there is reason to depart from that course in the present case.

113. Ms Bakey was wholly successful. She is entitled to a costs order in her favour. In relation to Mr French and Dr Bremner, bearing in mind that each man failed in this Court, save in relation to the calculation of interest which was not the subject of any written submissions and did not appreciably extend the length of the hearing and so may be disregarded for the purposes of the exercise of the costs discretion, I think the appropriate order is that there be no order as to costs, with the intention that each man bear his own costs. That reflects the overall outcome, and spares the parties the possibility of further disputation as to the assessment of costs.

114. Separate from the above is Mr French’s motion of 30 October 2020. Those costs were discrete. The costs of that motion should follow the event.

115. Finally, the orders made by the primary judge appointed trustees for sale of the properties co-owned by Mr French, for the purpose of satisfying the judgment debt. The dismissal of Mr French’s appeal carries with it the consequence that those orders remain in place. However, the orders only authorised the trustees to sell the properties within a 12 month period, which time has expired.

116. So far as I can see, there is nothing stopping Dr Bremner seeking an extension of that period, if the appointment of trustees for sale remains necessary. It would be in both Dr Bremner’s and Mr French’s interests to avoid the costs of such a renewed appointment.

117. I propose the following orders:

1. Grant leave to Mr French to amend his notice of appeal to challenge the award of interest.

2. Dispense with the filing of an amended notice of appeal.

3.    Allow Mr French’s appeal in part and set aside order 1 of the orders made on 31 October 2019, but otherwise dismiss the appeal.

4.    Direct the parties to supply agreed calculations, or in the absence of agreement, calculations for which each contends, of the amount of interest at 5% upon the amounts totalling $3,148,718 lent by Dr Bremner, within 28 days of today, noting that this Court proposes to enter judgment against Mr French on Dr Bremner’s cross-appeal in the amount of $3,148,718 plus interest at the rate of 5%.

5.    As against Ms Bakey, refuse leave to extend time within which to bring an appeal against the dismissal of the proceedings brought by Dr Bremner against her, and dismiss the cross-appeal insofar as it is brought against her as incompetent.

6.    Order Dr Bremner to pay Ms Bakey’s costs of the cross-appeal.

7.    As against Mr French, dismiss Dr Bremner’s cross-appeal.

8.    Dismiss the balance of Mr French’s notice of motion filed 30 October 2020.    

1. Mr French to pay Dr Bremner’s costs of his notice of motion filed 30 October 2020 to adduce further evidence on appeal.

10.    Subject to orders 6 and 9, there be no order as to the costs of the appeal and cross-appeal, with the intention that Mr French and Dr Bremner bear their costs of the appeal and cross-appeal.

118. WHITE JA: I agree with Leeming JA.

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Decision last updated: 18 December 2020