Supreme Court
New South Wales
Medium Neutral Citation: John Hudak & Anor v Rhys Adams & Anor [2013] NSWSC 1464 Hearing dates: 11 to 12 September Decision date: 27 September 2013 Jurisdiction: Equity Division - Expedition List Before: Rein J Decision: The first defendant has obtained registration as the owner of two properties formerly owned by the second plaintiff by means of a fraud practised upon the second plaintiff including the forgery of the first plaintiff's signature. The second plaintiff is entitled to a declaration that the transfers of the properties had been obtained by means of a forgery and a false statement concerning the status of the first plaintiff. The second plaintiff is entitled to damages from the first defendant equivalent to the amount of the mortgage obtained by the first defendant from the Westpac Banking Corporation and also to compensation out of the Torrens Fund and, to the extent that the second defendant has compensated the second plaintiff, the first defendant must indemnify the second defendant in respect of the amount paid out of the Fund. The first plaintiff is entitled to a declaration that a document described as a pre-testamentary disposition document and claimed by the first defendant to have been executed by the first plaintiff on his own behalf and on behalf of the second plaintiff, is a forgery and of no validity.
Catchwords: FRAUD - whether the first defendant has committed fraud and forged the first plaintiff's signature on the transfers of real property, the pre-testamentary disposition document and on other documents - whether transfers of property were forged by the first defendant - whether the first plaintiff was complicit in the forgery or consented to the transfer
REAL PROPERTY - claim for compensation out of Torrens Assurance Fund
EVIDENCE - consideration given as to whether a Jones v Dunkel inference can be drawn in a civil caseLegislation Cited: Corporations Act 2001 (Cth)
Criminal Asset Recovery Act 1990 (NSW)
Evidence Act 1995 (NSW)
Real Property Act 1900 (NSW)Cases Cited: Adler v ASIC; Williams v ASIC [2003] NSWCA 131
Azzopardi v The Queen [2001] HCA 25, (2001) 205 CLR 50
Briginshaw v Briginshaw (1938) 60 CLR 336
Comptroller-General of Customs v Parker [2006] NSWSC 390
Cullen (Executor of Lascelles) v Welsbach Light Co of Australasia Ltd [1907] HCA 3, (1907) 4 CLR 990
Elfar v Registrar General of New South Wales [2010] NSWSC 539
Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298
Manly Council v Byrne [2004] NSWCA 123
R v Mok [2003] NSWSC 424
Rejfek v McElroy (1965) 112 CLR 517
Rowell v Larter (1986) 6 NSWLR 21
SS Pharmaceuticals Co Ltd v Qantas Airways Co Ltd [1991] 1 Lloyd's Rep 288Category: Principal judgment Parties: Mr John Hudak (first plaintiff)
J.H. Enterprises Pty Ltd (second plaintiff)
Mr Rhy Adams (first defendant/ cross defendant)
Registrar General of NSW (second defendant/ cross claimant)Representation: Counsel: Mr J. Bartos (first and second plaintiff)
Mr I. Lloyd QC and Mr D.…
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- AGLC
- Hudak v Adams [2013] NSWSC 1464
- Case
- [2013] NSWSC 1464
- Decision Date
CaseChat Overview and Summary
In Hudak v Adams, the plaintiffs, Mr Hudak and Mrs Hudak, sued the defendants, Mr and Mrs Adams, alleging fraud and forgery in relation to the transfer of real property, a pre-testamentary disposition document, and other documents. The plaintiffs also sought compensation out of the Torrens Assurance Fund. The court had to decide whether the first defendant committed fraud by forging the first plaintiff's signature on the documents and whether the first plaintiff was complicit in the forgery or consented to the transfer. The court also had to consider whether a Jones v Dunkel inference could be drawn in a civil case.
The court examined the evidence, taking into account the age and health of Mr Hudak, the first plaintiff. It concluded that his evidence was reliable and corroborated by other evidence. The court found that the first defendant's failure to give evidence in his own defence led to an adverse inference. The court also considered the standard of proof, which required the plaintiffs to prove their case on the balance of probabilities. The court found that the plaintiffs had discharged this burden.
The court concluded that the first defendant had committed fraud by forging the first plaintiff's signature on the documents. It also found that the first plaintiff was not complicit in the forgery or consent to the transfer. The court ordered the first defendant to pay compensation to the plaintiffs and to compensate the first plaintiff for the loss of the property. It also ordered the first defendant to pay costs.
The court examined the evidence, taking into account the age and health of Mr Hudak, the first plaintiff. It concluded that his evidence was reliable and corroborated by other evidence. The court found that the first defendant's failure to give evidence in his own defence led to an adverse inference. The court also considered the standard of proof, which required the plaintiffs to prove their case on the balance of probabilities. The court found that the plaintiffs had discharged this burden.
The court concluded that the first defendant had committed fraud by forging the first plaintiff's signature on the documents. It also found that the first plaintiff was not complicit in the forgery or consent to the transfer. The court ordered the first defendant to pay compensation to the plaintiffs and to compensate the first plaintiff for the loss of the property. It also ordered the first defendant to pay costs.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
Section 165 recognises that the reliability of evidence "may be affected by age, ill health (whether physical or mental), injury or the like" Section 165(2), (3), (4), (5) and (6) which are the operative parts of s 165 are clearly dealing with jury trials and warnings to be given to juries. I am unable to accept that s 165 has any application to civil cases heard without a jury and I think that what Sully J should be taken to mean is that even in civil trials without a jury a judge needs to consider whether there are reasons (such as the fact that the evidence is that of a police informant) which tend to make the evidence unreliable. Mr Lloyd also referred to s 20 of the Evidence Act but sub-s 20(1) makes it clear that the section applies only to a criminal proceeding. I take into account that Mr Hudak is 91 years of age and that he is suffering from the end stage of renal failure, diabetes and heart disease (see Exhibit A which although marked as a plaintiff's exhibit was tendered by the plaintiffs at the request of Mr Lloyd: see T4). I accept that Mr Hudak's memory may not be as good as it once was but I do not regard his evidence as unreliable. His affidavit evidence is cogent as are his answers to the 107 questions directed to him in writing by the first defendant's solicitors (see Exhibit 1D3). Mr Hudak's evidence of Mr Adams' assertion, in a phone conversation between 5th and 11th of October, that Mr Hudak had already signed the document was itself an indicator of Mr Hudak's veracity as a witness as is the fact that he did not claim that he had initiated the conversation about the transfer. Further there are matters independent of Mr Hudak's evidence which corroborate his case that Mr Adams is a fraudster, namely: Mr Lloyd emphasised the need for the Court to take into account the standard of proof articulated in Briginshaw v Briginshaw (1938) 60 CLR 336. It is clear from Briginshaw and Rejfek v McElroy (1965) 112 CLR 517, 521-522 per Barwick CJ, Kitto, Taylor, Menzies and Windeyer JJ that the Court must bear in mind the seriousness of what is alleged against Mr Adams in determining whether the plaintiffs have made out their case that the transfer was effected by the fraud of Mr Adams. I have had regard to that requirement in determining the outcome of this matter. The failure of a party to give evidence in his own defence clearly gives rise to an inference that his evidence would not assist him in the case: see Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298, 312 per Menzies J, 308 per Kitto J, 319-332 per Windeyer J discussed in Manly Council v Byrne [2004] NSWCA 123; see also Cullen (Executor of Lascelles) v Welsbach Light Co of Australasia Ltd [1907] HCA 3, (1907) 4 CLR 990 at (1002) per Griffith CJ and SS Pharmaceuticals Co Ltd v Qantas Airways Co Ltd [1991] 1 Lloyd's Rep 288 and Adler v ASIC; Williams v ASIC [2003] NSWCA 131, [651] per Giles JA with whom Mason P and Beazley concurred. Mr Lloyd pointed out that rule is subject to there not being an explanation for why the witness or, in this case, the party, has not given evidence and submitted that the fact that Mr Adams is under investigation in relation to this matter (see COPS Event Summary at Exhibit 1D1) is a valid explanation. Mr Lloyd cited Adler v ASIC; Williams v ASIC in which the Court of Appeal rejected an appeal from the trial judge's decision that concerns Mr Adler and Mr Williams claimed to have about the impending Royal Commission were not a sufficient or valid explanation to preclude an adverse inference being drawn in civil penalty proceedings. Mr Lloyd contended that the reasoning of the Court of Appeal from [648] of the judgment supported his contention because the Court concluded that generalised assertion by Mr Adler and Mr Williams that the evidence would "in an unelucidated way redound to their disadvantage" was not sufficient rather than holding that a Jones v Dunkel inference would not be precluded in a civil case because of a concern about consequences in other proceedings.
Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
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