Kyprios v Maroudas No. DCCIV-98-1301

KYPRIOS V MAROUDAS
[2001] SADC 20

His Honour Judge David
Civil Jurisdiction

The plaintiff, Katie Kyprios, is the mother of Mia Maroudas. Mia Maroudas is the wife of Petros Maroudas who is the son of the defendant Peter Maroudas. The plaintiff’s claim arises from her relationship with Petros Maroudas when he and Mia Maroudas were living with the plaintiff during 1994 and 1995. It is claimed that she unwittingly mortgaged her property at Richmond for the sum of $135,000.00 when she really intended to consolidate two mortgages into one debt of $60,000.00. As will be seen the plaintiff’s case as pleaded is that that state of ignorance was brought about by the behaviour of Petros Maroudas and his influence over the plaintiff. The amount claimed was originally $151,752.50 because of the build up of interest. The property was subsequently sold and the mortgagees paid out and the claim now has been increased because of a further build up of interest and costs to $214,887.52. The plaintiff also claims $38,000.00 as a result of Petros Maroudas selling her car and buying a new one for her in a manner which was against her instructions and resulted in her losing that amount of money.
The plaintiff obtained judgment by default on the 21st July 1999 against Petros Maroudas for $278,546.17. I am told that the subject matter of that judgment is the same as that which is now brought against Peter Maroudas in this action. The plaintiff’s claim against Peter Maroudas is that on a number of occasions the defendant for consideration agreed to repay the plaintiff the above amounts that were owed because of his son’s behaviour and it is that agreement which the plaintiff claims is the basis of liability. On the plaintiff’s case there was a conversation in June of 1995 in which the defendant said he would guarantee the debt owed by his son. It is also alleged that in the same year there was a conversation in Greece in which the defendant proposed he would pay off the debt incurred by his son if properties in Greece were transferred to his daughter‑in‑law Mia Maroudas. It is the existence of those conversations which form the basis of liability according to the plaintiff’s case.
The defendant in his pleadings and in evidence denies that he ever proposed to repay his son’s debts to the plaintiff. Put briefly, his case is that the only involvement that he had in any of this money was to let his son use the defendant’s bank account in dealing with the money he obtained from the plaintiff’s mortgage.
There are a number of alternative pleas by the plaintiff set out in the pleadings and all of those, it is agreed, depend upon me finding it proved that there was a promise by the defendant to the plaintiff to repay money for his son’s behaviour in relation to the motor cars and the mortgage on the original property.
It is to be noted that Petros Maroudas was not called by either side. From the evidence that was presented to me it is fairly obvious that he is the major villain in these events. That fact is consistent with both cases. I say at the outset that I cannot draw any inferences adverse to either party on the fact that he has not been called. From what I have heard about him in evidence given by both sides there would be great doubts about his credibility. I can understand why neither side has called him as a witness. I turn to the plaintiff’s case.

The Case for the Plaintiff

The plaintiff gave evidence on oath and called two witnesses, a psychiatrist Dr Malcolm St James and a Mr Rody Papas. Mr Papas is a land broker and gave evidence of preparing a loan indenture for the plaintiff in relation to antecedent debts owed by the defendant. He arranged for a caveat to be placed over the title of the home of the defendant in December of 1995. That caveat was subsequently removed. On the plaintiff’s case the evidence of Mr Papas indicates an admission by the defendant, because of that loan indenture, that he in fact owed the plaintiff a substantial amount of money in 1995. The defendant argues that the purpose of that loan indenture was for an entirely different reason. I indicate that I will deal with the evidence of Mr Papas and the loan indenture and the caveat as a separate issue later in this judgment.
The calling of the psychiatrist Dr St James was for the purposes of explaining the state of mind of the plaintiff during her relationship and transactions with Petros Maroudas and to a lesser extent with his father. As will become clear her evidence as led indicates a remarkable ignorance as to the nature of documents which she clearly signed and transactions in which she was involved which themselves were witnessed by bank officers and land brokers. Dr St James was of the opinion that since the death of her husband in 1993 and especially in relation to the period of 1995 and 1996 the plaintiff’s ability to critically evaluate decisions involving contractual issues and major financial issues would be very compromised. He was of the opinion that her short term memory was poor, her concentration was poor and her ability to accept what she was told in an almost uncritical manner would have compromised her ability to critically evaluate decisions of the magnitude and nature which are the subject of this claim. I accept the opinion of Dr St James and I bear that opinion in mind when assessing the evidence. I turn to the evidence of the plaintiff.
The plaintiff was born in Port Pirie in South Australia coming from a Greek background. She was married and had four children, one of whom is Mia Maroudas, a witness for the defendant in this case. Her husband died in February of 1993 and since 1992 she has had psychiatric problems which have necessitated her being treated by Dr St James since that period. She admits that she has an alcohol problem. When her husband died she owned a number of properties including her home at 13 Gaskin Road, Flinders Park, a shack on the Yorke Peninsula and a property at Welland. She sold the property at Welland and bought an investment property at Milner Road, Richmond. She first met her son‑in‑law, Petros Maroudas, in February of 1994. In March of 1994 she bought a Range Rover motor vehicle for $96,700.00 having obtained that amount from the sale of the property which she had at Hartley Road, Flinders Park. She then gave evidence that about two months after she bought that car Petros Maroudas, who had told her to buy it in the first place, strongly influenced her to sell it and indicated that she would get at least $90,000.00 for it. He persuaded her to go to a car dealer named Tom Forde. On her evidence Petros went into the office and spoke to Tom Forde while she waited outside. She eventually signed the appropriate documents for the sale of the vehicle (Exhibit P1, pp 6-7). The plaintiff signed both of these documents but gave evidence that no amount was placed on either document. She denied that there was an amount of $78,000.00 on either of the documents when she signed them. She was told eventually by Petros that he had sold the car on her behalf for $78,000.00 therefore she lost about $20,000.00 on that sale. It is that $20,000.00 which forms the first part of the claim originally against Petros and now against the defendant. She then gave evidence that Petros had a cheque for $78,000.00 and they went to the Commonwealth Bank at Flinders Park because he wanted her to take all the money out in cash. She had a savings account with that branch. However that branch did not have that amount of cash and she was taken by Petros to another bank and left her passbook there for the purposes of $78,000.00 being taken out. The arrangement was that Petros was going to go back and get that cash and buy another car. She said she never saw that cash. Her further evidence in relation to the involvement between herself and Petros concerning cars was that Petros then came home one night and told her that he had bought a Nissan Patrol TI from Main North Nissan with the money that was received from the sale of the Range Rover. He said that he paid $60,000.00 for it. When she asked for the rest of the money he said that he and Tom Forde had bought a property with it and she has never got that back.
As matters turned out there is clear evidence that in fact the vehicle was encumbered and therefore Petros kept the $60,000.00 but the plaintiff eventually retained the vehicle. Therefore the claim in relation to the cars both against Petros and eventually the defendant amounts to $38,000.00. She also at that stage had no idea that the car was encumbered.
The plaintiff gave evidence that she met the defendant sometime in the middle of 1994. By then it was obvious that the relationship between her daughter and Petros Maroudas was becoming serious. Her evidence was that a short while after they met he suggested that the plaintiff go overseas with he and his wife (since deceased). On her evidence the defendant in suggesting the trip said that it was because the plaintiff owned properties in Greece which had been left to her by her husband. This conversation took place in early 1995. At that time Mia and Petros had become engaged. They were both living with the plaintiff at her home. She said that she eventually agreed to go to Greece.
After discussions with the defendant about going to Greece she then gave evidence of a discussion with Petros about consolidating her loans. At that time she had two loans with the Commonwealth Bank, one over a townhouse in Richmond and one over her home at Gaskin Road. The combined amount of those loans was $60,000.00. She gave evidence that Petros persuaded her that if she consolidated those loans she would be paying less interest. She then said that Petros came home one night and told her that a friend who could arrange the consolidation was visiting his parents and had papers prepared for her to sign. She gave evidence that she went with him to the defendant’s house on Goodwood Road and signed papers which she thought were consolidating the two loans into one loan of $60,000.00. She said that while at the house Petros told her that she had to sign certain papers. She thought those papers were merely consolidating her two loans into one loan of $60,000.00. She said that at that meeting she was sitting at the kitchen table and also present was the defendant and a stranger. She gave evidence that nothing of significance was said by the defendant but the stranger told her to sign the papers and she duly did so. She said the whole incident only took a few seconds. Some time later she said that Petros came home with a piece of paper in his hand which she read and she was told by Petros that it was not a $60,000.00 loan but a loan for $135,000.00. She gave evidence that Petros told her that she was helping him to buy a property at Goodwood because he couldn’t get a loan in his name. She then said to Petros that “you have conned me” (transcript page 131). The letter to which she was referring was a letter from a Mr Schaftenaar to the plaintiff dated the 13th June 1995 (Exhibit P1, p 30). She then gave evidence of discussions she had with the defendant about promises he made to pay back that money and money for the cars. That evidence is dotted throughout the transcript and it is important that I set out her evidence on that topic in full as it is part of the basis of the claim. After the discussion with Petros whereby she was informed that she now owed $135,000.00 and a few days before she was to go overseas in about June of 1995 the defendant came to see her. I set out her evidence on that topic (transcript pp 132-133):
"Q.... Do you recall when you were to go overseas to Greece.
A...... Towards the end of June.
Q...... Can you tell his Honour the occasion in which Peter Maroudas came to see you.
A...... He came to see me - he told me he was guarantor for the loan, that he was making the payments and he was paying the loan off.
Q...... Where did this conversation take place.
A...... That was at my place.
Q...... Was there anybody else present at the time it took place.
A...... No, it was just Petros. I think it was Petros there.
Q...... So there was yourself.
A...... Yes.
Q...... Mr Peter Maroudas.
A...... Yes.
Q...... And Petros.
A...... Yes.
Q...... Do you recall what words were said by Mr Peter Maroudas.
A...... He said to me ‘I’m guarantor. I’m guarantor. I’m paying the loan and I’m paying the loan off’ because I told him I didn’t even want to go to Greece because Mia was still going to school; she wasn’t working, Petros wasn’t working and if I was to go over there that means I would have to leave - because I was the one supporting them, you see.
Q...... Supporting Mia -
A...... Both Mia and Petros.”
....
(Transcript pp 134-136):-

"Q.... Can we come back to, now, June 1995, and you have described this conversation, with Mr Peter Maroudas, about where the word ‘guarantor’ was mentioned.
A...... Yes.
Q...... Did you say something to him about going to Greece in these circumstances.
A...... And he was making the payments.
Q...... Was there anything else said in the course of that conversation.
A...... Yes, he told me he was going to be paying off the whole loan and he was going to be paying me back the money I lost on the cars.
Q...... Was there any dollar value placed on the loss of the money on the cars. Was a figure mentioned.
A...... There was $38,000 I lost on the Range Rover and there was 20, 25 on the Mazda 121.
Q...... Did he mention those dollar amounts to you.
A...... Yes, he told me he was going to pay me that back, that money.
Q...... This is sometime about mid June ’95, just before you went to Greece.
A...... Yes, and even before that, when they had the Brickworks.
Q...... What happened about the Brickworks.
A...... Well, he told me he paid over $60,000 for the Brickworks, that he bought it for his son. When they sold it they were going to pay me back the money for the cars I lost, the money I lost on the cars.
Q...... When did the conversation about the Brickworks take place.
A...... That was after they lost the house, at Malvern.
Q...... ‘They’ being Petros and Mia.
A...... Yes.
Q...... When did they lose the house at Malvern.
A...... I’m not sure because everything was one after the other.
Q...... Can we just come back -
A...... I always thought it was in ’94 some time, late ’94.
Q...... Can we just come back to this conversation in mid to late June when you mentioned Mr Peter Maroudas talking to you about going guarantor and paying back the loan.
A...... Yes, and he told me he’d already organised for the payments to be made while we were overseas as well.
Q...... Was the Brickworks part of the same conversation.
A...... Not at that time.
Q...... Did Brickworks happen later.
A...... Brickworks happened before, when they still had the Brickworks.
Q...... Can you recall what the conversation was about the brickworks (sic) and when it took place.
A...... That was after they lost the house and they still had the Brickworks; because Pedro always said to me that the Brickwords (sic) was mine as my security.”

There was then evidence about the Brickworks which was a café on South Road which belonged to Petros having been bought by the defendant. The plaintiff used to help in that business between 1994 and 1995 until she was told by Petros that the doors had been closed on them by the landlords and that he was going to sue those landlords. Also on the topic of the defendant promising to repay the loans she gave the following evidence (transcript pp 138):-
"Q.... He had made arrangements to pay the loan while you were away.
A...... Yes.
Q...... You had the discussion about being concerned about going to Greece.
A...... Yes, and he said to me that ‘Whatever goes on, it’s between me and you’ and he said ‘The others don’t have to know’ he said ‘because I’m paying the loan and Mia and Pedro are the ones that are living with you and looking after you’.”

In evidence the plaintiff was shown by her counsel a copy of a withdrawal slip from the plaintiff’s streamline account at the Commonwealth Bank for $68,915.15. Her signature is on that withdrawal slip. She gave evidence that she had no recollection of that document. She was also shown a photocopy of a document which was a bank cheque dated the 7th June 1995 for $68,910.05 made out to Peter Maroudas. She said that she cannot remember going to the bank with Petros Maroudas in relation to either of those two documents. As the evidence unfolded it was clear that those documents represented the balance of the loan being the difference between the amount of $135,000.00 which was borrowed and the amount of approximately $60,000.00 which she owed on her original mortgages. She also gave evidence that the defendant told her that that money had gone towards the Goodwood property. The plaintiff was also shown by her counsel a number of letters that were sent by a licensed land broker, Mr Beames, in relation to the mortgage in which the amount of $135,000.00 was clearly mentioned (Exhibit P1, pp 13‑14). Her evidence was that she never received any of those letters. When shown a copy of the Memorandum of Mortgage itself and specifically when shown her signature she said that she had no recollection of signing that document on the 2nd June 1995 and has no recollection of that document at all (Exhibit P1, page 17). She also gave evidence that she never signed any document at Kent Town (as stated on the Memorandum of Mortgage) and cannot say whether that was the document which she signed at the defendant’s house when taken there by Petros purportedly to consolidate the loans.
The plaintiff gave evidence that she went to Greece in late June 1995. She said that Mr Peter Maroudas paid for her ticket. While in Greece she stayed at the house of the sister of the defendant and came home in August of that year. She said that while in Greece the defendant and the defendant’s wife told the plaintiff that they would pay off the loan as soon as they came back to Australia. She then gave evidence that in October of 1995, after they had all returned to Australia she was contacted by Rody Papas and she gave evidence of the incident in relation to the loan indenture. As I indicated earlier I am treating that part of the case as a separate topic and therefore deal with that evidence later in my judgment.
She gave evidence of a particular incident that happened in 1996. It was further evidence from the plaintiff of promises by the defendant to pay off the loan. She said when questioned by her own counsel (transcript pp 163-164):-
"Q.... Was there a particular event that happened in 1996 that comes to mind.
A...... Yes.
Q...... What was that.
A...... That was early 1996 when Petros came home and he told me that his father was planning to go to Greece for a holiday and he wanted us all to go as a family because his father wanted Mia and Petros to be married in Greece, and there was a conversation and I told him I wasn’t ready to go to Greece. I said ‘I have only just come back; I’m not ready to go to Greece’, and I said to Petros ‘I’m not going to Greece until that loan is paid off’ and that’s when things just, you know, there was talk and then just blew up and all I remember is screaming at him to ‘Get out. Get out. I don’t want to see youse. Just get out of here’. There was a big argument and they took off. I locked all the doors. I don’t know whether I threatened to kill myself, I don’t know. There was just a big blow-up. They took off. They came back. They tried to open the doors. I wouldn’t open the doors. They took off again and then maybe half an hour later I heard the father knocking on the screen door, or on the front door, calling out for me to open the door, and I didn’t answer at first. Then he said - he kept calling out ‘Katie, Katie, open the door. And if you don’t open the door I’m going to break the glass - break the window’. So I went down and I opened it and the father stood in the front, and Mia and Petros was just standing behind him, and he said to me ‘Let me come in; I want to talk to you’; so I opened the door. He came in but he told Mia and Petros to wait outside, and he said to me, he goes, ‘I want to know why you and Petros are arguing’. He said ‘Are you worried about the loan?’ and he said to me ‘I’ve given you my word that the loan is going to be paid off’, he said to me, and he said ‘I’ve already talked to my lawyer he said I’ve been to see my lawyer and I have postponed the court case until after I come back from Greece’, and he said to me ‘And if we don’t win the court case, I will sell one of my properties to pay the loan off’. He said ‘I don’t want you worrying about the loan at all’. Then he told me that he wanted us all to go to Greece because he wanted Mia and Petro to be married in Greece, and he said ‘We are all going as a family’, and he told me ‘and I’m paying all the tickets’ he told me. And he also said to me that while we were there that I had to check up on, like, pick up the documents for the Greek properties, he said, ‘in case there is any trouble with the tax because you could lose your properties in Greece’. So then later he said that I had to get a paper from the embassy to act on behalf of my children while I was there.”

She then said that after that incident they eventually went back to Greece in about July of 1996. She went with the defendant, Petros, and her daughter, Mia. Once again while in Greece they stayed with the defendant’s sister and also while in Greece she gave evidence that she signed some papers which in effect transferred her Greek properties to Mia. She could not read the papers because they were written in Greek but was told that by the defendant. In relation to that topic she gave the following evidence (transcript pp 167-168):-
"Q.... Do you know what those papers were that you signed.
A...... They were to go to Mia. I had to sign the papers for Mia for the properties in Greece to go to Mia.
Q...... How did you know that they were documents to that effect.
A...... Because Mr Maroudas told me.
Q...... That is Peter Maroudas.
A...... Yes.
Q...... Can you recall what he told you and when he told you those things.
A...... That would have been about two weeks before the documents were brought to the house. And he told me that I had to sign because he was paying the loan off and I had to sign the documents because he wanted all the properties in Greece to go to Mia.
Q...... Can you recall the words that he used when he spoke to you about the properties going to Mia.
A...... He told me before that -
Q...... Before when.
A...... Before the papers were signed, that the properties would still be mine as long as I was alive but that Mia was signing as my, like, security or beneficiary.
Q...... Did he describe which properties were involved.
A...... No, he wanted all the properties in Greece to go to Mia and he told me that once we came back, he would - because I told him I was frightened of signing the papers because I was going to be in a lot of trouble because my children trusted me to act on their behalf, and he told me - he said ‘I’ll be paying the loan off and there won’t be any other trouble with your children’. He said ‘You change your will as soon as you get back and all the properties back home will go to your other children’.
Q...... Did there come a time when you did put your signature on some papers while you were in Greece.
A...... Yes.
Q...... Do you recall how many documents there were.
A...... There was a whole lot of documents.
Q...... In whose presence did you sign those documents.
A...... There was Peter Maroudas, there was Petros, because Mia - I had to sign and then Mia signed underneath - there was his sister, his brother‑in‑law, his nephews and his nieces. He had the niece living there and his nephew living there. The whole family was there.
Q...... All in the one room at the one time.
A...... Yes.
Q...... When you and Mia signed documents.
A...... Yes. There might have been a couple of - like, the nephews and nieces might have been sitting out on the patio but all us, all the grown-ups were in there.
Q...... Did someone, to your recollection, witness your signature.
A...... No; except the lady that brought the papers.
Q...... Sorry.
A...... The notary, the lady that brought the papers.
Q...... So there was another lady present who wasn’t a member of the family.
A...... Yes, the one that did all the paperwork.
Q...... And she was there when you and Mia signed these papers.
A...... Yes.”

About two weeks after signing those papers the plaintiff, Mia and the defendant came back to Australia and Petros returned about a month later. After Petros returned from Greece he and Mia moved out of the plaintiff’s house. In early 1997 she told of an incident when she found a page of the Memorandum of Mortgage and showed it to her other daughter, Maria. She said it was in the kitchen on top of a cupboard. At a later stage she received a notice of default and she took it to her lawyers and then a notice of sale which she also took to her lawyers (Exhibit P1, pp 91 and 93). Gaskin Road was then sold and the mortgagees were paid out.
The plaintiff’s claim is for the amounts promised by Peter Maroudas namely the money which she borrowed because of Petros’ influence and deceit which was originally $135,000.00 but it is conceded that $60,000.00 should be subtracted from that amount because that paid off her original debt. Also she claims the amount $38,000.00 being the amount that Petros by deceit obtained from her in relation to the sale of the Range Rover and the purchase of the Nissan. On the plaintiff’s case the defendant also promised to be repay that debt.
The plaintiff was thoroughly and extensively cross-examined. It was put that there were no conversations between the plaintiff and the defendant whereby the defendant promised to pay back either the mortgage and the shortfall on the cars. Although the transactions which took place between Petros Maroudas and the plaintiff do not necessarily involve the defendant, on the defence case they are important because there are certain aspects of the plaintiff’s evidence in relation to those transactions which the defendant says go to the question of her reliability and credibility. An aspect upon which she was cross-examined was that Petros often threatened to kill her and threatened her with violence. When cross-examined she said that she never told anybody about that and specifically never told her other children, Mia and Zach. A question of violence became significant in relation to the Papas loan indenture which I will mention later. She also said that she never told her doctor about these threats of violence. She was cross-examined extensively about how it came to be that she sold the Range Rover and how it came to be that she just signed papers without knowing what they were. The fact that she signed papers at the place of the business of a car dealer without knowing what they were merely because Petros told her to do it was put to me as being odd to say the least. She did volunteer an explanation that she had been drinking at the time but I observed that throughout the documents there are a number of signatures belonging to her which she cannot account for. I find it difficult to accept her evidence that she did not understand that the papers which she signed at Prestige Motors were for the transfer of the Range Rover. Similarly her evidence that she did not realise that she was signing a Memorandum of Mortgage when her signature was clearly on that document is something I have difficulty in accepting, despite the evidence of Dr St James concerning her mental state at the time.
It was put to the plaintiff in cross-examination that the defendant never promised to pay that money either for the cars or the mortgage. In relation to the meeting at the house of the defendant in which the plaintiff signed the Memorandum of Mortgage it was put to her in cross-examination that she signed an authority for Mr Beames, a licensed land broker, to act on her behalf and arrange for the preparation of that mortgage. That document is dated the 2nd June 1995 and bears the plaintiff’s signature (Exhibit D8). When cross-examined on that document she could not explain how her signature was on it and she said that she had never seen it before. It was also put in cross-examination that the Memorandum of Mortgage was signed at Kent Town. She denied that proposition. It was also put in cross-examination that on the 5th June 1995 she went to the Flinders Park Bank with Petros and spoke to a female teller who got her to sign the back of an Adelaide Bank cheque for the purposes of signing the amount on that cheque over to Peter Maroudas (Exhibit D9). The plaintiff said no one asked her to sign anything on the back of a cheque and she never spoke to anyone about a cheque despite the fact that it obviously bore her signature. On that same topic she said that at the very least she did not know about signing the withdrawal form for the same amount of $68,910.00 from the Commonwealth Bank (Exhibit P10). It was put to the plaintiff that Mr Maroudas never guaranteed that he would pay off the loan. She was cross-examined extensively on that topic. The plaintiff was also cross-examined extensively about the Papas loan indenture, as I indicated I will treat that as a separate topic. The issue that was clearly drawn between the parties was whether these conversations took place both in Australia and in Greece as to the question of whether the defendant guaranteed for consideration the debt owed by his son in relation to the mortgage and the cars. In relation to the Nissan which was purchased by the plaintiff and was encumbered it was put to her that she knew it was encumbered because she signed an insurance proposal on the 24th June 1994 which clearly indicated that fact (Exhibit D11). She still denied that she knew anything about that loan.
As I have indicated I observed the plaintiff carefully and I have endeavoured to give an overview of her evidence as to the salient matters. In particular I have looked carefully at the question as to whether these conversations about the defendant guaranteeing to repay the loan took place. If I find that on the civil onus they have not been proved to have taken place of course despite the losses incurred by the plaintiff to Petros there could be no claim against the defendant. I now turn to the defendant’s case.

The Case for the Defendant

The defendant himself gave evidence and called three witnesses. They were Mia Maroudas, his daughter‑in‑law, Julie Gilbert a bank officer and Cornelius Schaftenaar a finance broker who was involved with the mortgage loan of $135,000.00.
The defendant gave evidence that he is aged 55 and was born in Greece and came to Australia in 1969 and married his wife Joanna. His eldest child, Petros, was born in 1972 and he has a daughter, Helena, who is now 24 years old. He gave evidence of his son Petros meeting Mia. At that time the defendant owned a property at 672 Goodwood Road in which there were two shops. He turned those two shops into four shops and a house. All his properties were mortgaged with Citibank. He gave evidence that before Petros met Mia Petros was living at home and then went and lived at Mia’s house after they started a relationship. He gave evidence that he did not speak to Petros about his buying and selling of cars during 1994 and further that Petros and the plaintiff appeared to get on very well. He gave evidence that business at the Brickworks which Petros had bought was going badly and the business was eventually shut down. He said that before the business was shut down he never spoke to the plaintiff about promising to pay back her money that Petros had taken from her. He gave evidence that he never said anything about paying back money that Petros owed in relation to the buying and selling of cars on behalf of the plaintiff. He said that he had no idea about those matters.
He gave evidence that he travelled to Greece in 1995 with his wife and the plaintiff. At that stage his wife was near death with cancer. He said that he had arranged to pay for the trip by borrowing money from AVCO and he gave evidence that in the weeks before they went Petros gave him approximately $68,000.00 which is the money being the difference between the loan of $135,000.00 and what had to be paid out on the plaintiff’s previous mortgage. A Commonwealth Bank cheque made payable to Peter Maroudas was tendered in evidence (Exhibit D13) and the defendant gave evidence that it was given to him by Petros. Petros told him when he gave him that cheque that it came from the sale of his car. He told the defendant that he had sold it to the plaintiff. That conversation took place in the presence of the defendant’s wife. According to the defendant Petros told him that on receipt of the cheque the defendant was to pay $52,000.00 to Citibank because the car was encumbered to that amount. In fact on a cheque butt of the defendant which was tendered (Exhibit D14) an amount of $52,621.44 was paid to Citibank on the 6th June 1995. The defendant gave evidence that Petros told him that he did not have a cheque account and that is why that amount was deposited in the account of the defendant. Also out of that amount that was given to him by Petros there was a cheque butt indicating that $2,500.00 was paid to Petros in order for him to pay some bills and also a cheque for $5,964.00 dated the 7th June was paid to Athens Travel for the trip to Greece. The defendant also gave evidence that Petros told him to keep the balance of that cheque in the defendant’s account.
The defendant gave evidence of the trip to Greece which lasted from the 20th June 1995 until the 18th September 1995. He gave evidence that the plaintiff left a little earlier. He then gave evidence of the plaintiff signing documents at his house before she went to Greece. He knew that these documents were for her to get a loan and there was another man present who was a lender or a broker whose name he could not remember. This incident took place about two weeks before they went to Greece and he gave evidence that he was not told anything about that business and he wasn’t interested. He did not make these arrangements for the plaintiff to come to his house on this occasion and he did not know who did. He emphatically denied that he ever told the plaintiff anything about paying for any loans taken out by her or Petros. He said that he had never borrowed money from the plaintiff and in Greece there was never any conversation about repaying the plaintiff for a loan either to him or Petros.
He then gave further evidence about the cheque for the $68,000.00 which was given to him by Petros before he went to Greece. He denies thanking the plaintiff for lending him money after receiving that cheque as he did not believe it came from her. He gave evidence that shortly after his wife died on the 26th November 1995 Petros approached him about paying some of the money that had been left over out of the $68,000.00. He was referred to a number of cheque butts from his account bearing the name “Beames” for the amount of $1,181.00. These cheque butts were written out by Petros and the defendant gave evidence that he was told by Petros they were to pay somebody. He did not know anything about those issues and did not know where the money was going. He gave evidence that he had no idea that it was anything to do with the loan of $135,000.00.
The defendant gave evidence about going to Greece again in 1996 with the plaintiff, Mia and Petros. He denied ever saying before that that he would pay off the plaintiff’s loan. He said that Petros gave him the money to pay for the plaintiff’s airfare. He said that while in Greece he heard that the plaintiff was going to draft some documents transferring properties into Mia and Petros’ names. He cannot remember from whom he heard that. He said that he had nothing to do with these arrangements because it was none of his business and he never spoke to the plaintiff about them. He denied ever saying to the plaintiff that if she gave the Greek properties to Mia he would promise to pay back her loan. He said that during the trip to Greece in 1996 Petros and the plaintiff seemed to be getting on well.
He then gave evidence about the Papas loan indenture. As I have indicated I will treat that matter as a separate topic.
The defendant’s evidence was that there was never any promise to pay any debt for the plaintiff which may have been incurred by Petros. His evidence is that he had very little to do with Petros’ business and he was told and believed the receipt of the $68,000.00 was from the sale of the Nissan and was only to be received for a short period of time so that Petros could use a bank account.
When cross-examined thoroughly and extensively he was pressed on the topic of the Rody Papas loan indenture. As I have indicated I will deal with that later in my judgment as a separate topic.
It was put to the defendant in cross-examination that the person who came to his house just before he went to Greece in 1995 with some documents was in fact Mr Schaftenaar. The defendant agreed that after seeing Mr Schaftenaar in Court he was the man. It was put to the defendant that what Mr Schaftenaar brought to the house for the plaintiff to sign were loan documents in relation to $135,000.00. The defendant maintained that he knew nothing about the details. It was also put to the defendant that in company with Petros he went to the plaintiff’s house and discussed the topic of the $135,000.00 and said he would go guarantor for his son. He denied in cross-examination agreeing with the plaintiff that he would pay off her mortgage and denied that he said any such thing in Greece in 1995 or 1996. When it was put to him in cross-examination that for nearly a year and a half after he received the $68,000.00 in his account he wrote out cheques to Mr Beames he denied that he knew it was interest on the plaintiff’s loan. His answer was continually that he was merely doing what Petros wanted him to do. He assumed that Petros owed that money to Mr Beames and continually maintained that he did not think that had anything to do with the plaintiff.
There was also cross-examination about rent being paid from the Richmond property which was owned by the plaintiff into the bank account of the defendant’s and then being paid out to Mr Beames after the original $68,000.00 had been exhausted. The defendant maintained that that arrangement was totally organised by Petros and the plaintiff. In relation to that topic I set out the following passage of evidence (transcript pp 482-483):-
"Q.... And before you went to Greece in 1996, you made arrangements for the cheques for Mr Beames to be drawn.
A...... Yes, because Katie and Petros had told me that these cheques had to be paid and I did that; yes, I did.
Q...... So you drew some post‑dated cheques.
A...... I am not so sure how it was done. I’m not sure whether all the cheques were given by Petros all together or just one by one. But it couldn’t be that all the cheques would have been passed at the same time because there would not be enough cash in the account.
Q...... And that is because arrangements had also been made for the rent to be paid into your account while you were in Greece; is that right.
A...... Yes, to be deposited into my account, yes; because the left‑over money that was in Petros’s account would not be enough to cover for the payment. That is the reason why I had to ask Katie to put the rent in, in order to cover for the expenses, for my own account; because if I was not covered then I would not have gone to Greece.
Q...... It was your son who made those arrangements to pay the rent in while you were away, wasn’t it.
A...... They had arranged. That’s what I was told.
Q...... That’s what you were told - by who.
A...... Petros and Katie did.
Q...... In fact, it was Petros alone who told you about that, wasn’t it.
A...... And Katie, and many times she would tell me ‘Whatever Petros says’; many, many times: not once, not twice, many times.”

It was also put in relation to the trip to Greece in 1996 that he proposed to repay the loan to the plaintiff in consideration for her signing over her Greek properties to her daughter Mia. I set out the following passage (transcript pp 484-485):-
"Q.... You encouraged Katie to sign those documents, transferring the properties to Mia, didn’t you.
A...... Well, with my sincerity I’m saying never.
Q...... And at the time when you encouraged her, you repeated the promise you made here in Adelaide, a year before, that you would guarantee payment of her loans over her houses, didn’t you.
A...... I don’t ever make promises if I can’t sort of arrange to sort of keep them or to sort of make good them.
Q...... Indeed, you told her while you were in Greece that if she didn’t sign the documents then you wouldn’t remain guarantor and repay her loans.
A...... But I did not know about this loan. I just heard of this loan now. These things were between Katie and my son. That was their business.”

Mia Maroudas was called by the defendant. It was clear that there is very bad blood between she and her mother. They have had nothing to do with each other since 1997. I was earnestly asked to bear that in mind when assessing her credibility and I of course do so. However her evidence in many ways was peripheral to the main issue. Throughout 1994 she was studying at University and did not know a lot about what was going on with the business dealings of Petros. That was because she got home late at night. She gave evidence that she never had any discussions with her mother about the buying and selling of a Range Rover and the purchase of a Nissan except when it was announced that her mother had bought a Range Rover. She gave evidence that Petros and the plaintiff were very friendly and that the plaintiff consulted a psychiatrist while she was on Workcover during 1994 and on a number of occasions she saw the plaintiff in a drunken condition. I was concerned about the nature of that evidence but it was relevant to the plaintiff’s case on the pleadings in relation to her understanding of transactions that took place.
She gave evidence also that she was never told anything about money transactions involving her mother. She stayed out of that aspect of her mother’s life but she noticed that her mother would often talk to Petros. She said that she never really heard her mother or Petros arguing, she never saw or heard Petros threaten or physically assault her mother. She said her mother was excited about the prospect of going to Greece in 1995 and leading up to that trip she never complained about any financial transactions she had entered into with Petros. Also on her return from Greece there was no such complaint. She also gave evidence that normally her mother would collect the mail. She gave general evidence that her mother’s memory and mental abilities appeared to be normal during 1995. She gave evidence that she went in 1996 to Greece with Petros, the plaintiff and the defendant. Her evidence was that her mother was keen to do that. She gave evidence that while in Greece her mother signed properties over to her. In relation to that topic I set out the following evidence (transcript pp 508-512):-
"Q.... What discussions did you have with your mother about transferring those properties over to you.
A...... She wanted to give them to me. At one stage she wasn’t sure whether she wanted to give them to me or give them to Petros: it was whatever made her feel good on the day. If she had an argument with me she’d turn around and say to Petros ‘I am going to give the properties to you’.
Q...... Did you yourself actively encourage your mother to give them to you or Petros, or to either one of you.
A...... No, not really. I wasn’t - I wanted the properties. I knew that she wanted to sell them. I didn’t want to see the money thrown away like she had when my dad first passed away - she had gone and blown it all. I didn’t want to see that happen; I wanted to keep the land. It was like a heritage: my dad worked hard for those properties. I didn’t want to see it just squandered like she did with the rest of the money.
Q...... So what did you say to your mother about that.
A...... I didn’t say anything. She had already made her decision to sell, to write everything over to me and before I left a family friend actually said to her ‘Don’t sell the properties’ and he said this to her without anyone else around.
MR STRAWBRIDGE: This is hearsay now.
XN

Q...... Don’t tell us what someone else said. In any event, in Greece were papers eventually prepared and signed by your mother dealing with those properties.
A...... Yes, they were; and she also produced another piece of paper that she had written, without any of us knowing, saying that I was written out of everything here in Australia if I received everything in Greece. She had that paper written up with that conveyancer without anybody else knowing. I just signed it. I didn’t have any problem with that.
Q...... What did you see of your mother in terms of approaching conveyancers, dealing with them; that sort of thing. Where did you actually see her go. What, if anything, did you hear her discuss with conveyancers in Greece.
A...... I saw her all the time talking with her.
Q...... Where was that.
A...... It was at Petros’s dad’s sister’s house in Athens.
Q...... Who was present at those discussions.
A...... My mum, Petros, me.
Q...... Who was actually communicating to the conveyancer in terms of what documents were wanted and what documents should be prepared.
A...... My mum was discussing what documents were to be prepared and whatever and -
Q...... At some stage did you yourself sign some documents.
A...... Yes, I did.
Q...... Were they in Greek.
A...... Yes.
Q...... Can you read Greek.
A...... Yes.
Q...... What did you understand those documents to be, either from reading them or from what someone else said to you.
A...... They were - the properties were all transferred into my name: they were a sale. Some of them were a sale; another one was written into my name. One property in particular I couldn’t do anything with because my mother still had it in her name, I think until she passed away. So she collected the rent on that property until she passed away.
Q...... Was that in fact the only property that had a building on it that was being rented out.
A...... Yes.
Q...... Were the other properties, as far as you understood, vacant properties or semi built properties.
A...... Yes, vacant properties except with the one of a skeleton of an apartment block.
Q...... That is the one that your mother retained the writing until her death and collected rents from.
A...... The house, yes.
Q...... Did you understand all this just from reading the documents or was it also because of things someone said to you.
A...... Yes, it was discussed before we left for Greece. We went to the Embassy, the Greek Embassy in Adelaide and they discussed everything to us in Greek and in English.
Q...... As to the documents in Greece and what transfers were being effected there, did you understand what you have just explained to us because you read it yourself or did anyone also explain to you the effect of the documents were such as you have told us.
A...... I understood what was going not 100% but I understood what was going on. My mum had explained it to me a lot of times; Petros had explained it to me.
Q...... The person, the conveyancer who came to the house do you remember her name.
A...... Yes, it is Katerina Panayotopoulos.
Q...... Had you seen that name written anywhere.
A...... Yes, I had a business card with my mum’s writing in Greek with Katerina Panayotopoulos in Greek and with the phone number.
Q...... Where had you seen that business card, where did you first see it.
A...... I found it - when I first got sued by my mother I went through all these papers and things I had at home. I found it there. I thought that might be useful. I took it to Terrence and Paul. And I’m not sure where it is: it could be at home. I have got some things in storage at my father‑in‑law’s residence where I used to live, it could be there in storage.
Q...... Whilst in Greece and when dealing with these documents, did your mother ever express any reluctance in actually signing them over, apart from occasionally saying it was going to be Petros instead of you. Did your mother express any reluctance in signing them over to you.
A...... No, she was quite happy to do it.
Q...... Did you ever see Peter Maroudas attempting to persuade your mother to transfer the properties to either you or Petros.
A...... No. He was never even really around; he was always with the men drinking beer.
Q...... In particular - and I know you told us you didn’t hear him encouraging her, but I’ve got to ask you - did you hear Peter Maroudas saying ‘Look, if you transfer the properties to Mia I promise to pay back loans in Australia’.
A...... No, never. If anything, he tried to keep away from anything that Petros was doing.”

On returning to Australia in about November of 1996 they had a heated argument and she left the plaintiff’s house never to return other than to collect clothing and items. She was separated from Petros in February of 2000.
I observed her being cross-examined and I bear in mind the criticisms made of her evidence namely that there is much bad blood between she and her mother and she of course was an original party in these proceedings. As I have indicated however although her evidence if accepted does help the defendant to a certain extent it is in many ways peripheral to the main issue because of course she admitted that she had very little to do with the financial dealings between Petros and the plaintiff. A more important aspect of her evidence is of course the fact that there was no sign of any pressure being placed upon the plaintiff to sign over the Greek properties. In fact her evidence was the plaintiff willingly wanted to do that. This is of course contrary to the plaintiff’s evidence that the reason she signed over the properties was due to a promise made by the defendant to repay the loans if that was done. That of course is an important evidentiary basis of the claim.
The defendant also called Julie Gilbert whose evidence was basically uncontested. In 1995 she worked at the Flinders Park branch of the Commonwealth Bank and by looking at Exhibit D9 she can say she had dealings with that cheque. She can say that that cheque was brought to the counter by a man who said that he wanted to swap it for a Commonwealth Bank cheque made out in favour of Peter Maroudas. When asked whether it was his cheque he indicated a woman standing in the background who came forward and it was explained to her that the cheque had to be deposited into an account and had to be cleared by the Adelaide Bank before funds could be withdrawn. Ms Gilbert gave evidence that the woman (obviously the plaintiff) appeared to be understanding everything that was being said to her and there was no sign that she was having any problems in comprehending the situation. She also gave evidence that a discussion took place between herself and the man who came to the counter about the name “Peter Maroudas”. At that time the other woman was standing two or three steps away. Also when that lady signed the back of the cheque the name “Peter Maroudas” was already written on it. The next day that same man returned with a withdrawal slip (Exhibit D10), but this time he was alone.
The defendant also called Cornelius Schaftenaar. Mr Schaftenaar gave evidence that he is a Director at Leads Finance Brokers and is a Justice of the Peace. He gave evidence that he arranged for loans in the past for Peter Maroudas, the defendant. He originally saw the plaintiff come in with Mia and Peter Maroudas to his office on the 1st November 1994. His office was at Fullarton Road, Kent Town. The purpose of the visit was to make some inquiries about investing money but nothing eventuated. The plaintiff then contacted him some five or six months later in May of 1995. She rang and said she wanted to arrange a loan for $130,000.00. The witness indicated that there was a note on his file which specifically said that it was the plaintiff herself who phoned. He then contacted a Mr Beames to arrange that finance. He was then taken to the Memorandum of Mortgage (Exhibit P1, pp 17 - 18) and on page 18 of that document he indicated the plaintiff’s signature which was witnessed by himself as a Justice of the Peace. That was dated the 2nd June 1995. In looking at that document it indicates that it was signed and witnessed at his office at Kent Town. That was supported by a diary note which he had (Exhibit D21) indicating that the plaintiff was coming in at 10.00 o’clock on the 2nd June. Understandably Mr Schaftenaar could not independently recollect what happened and could not independently recollect what was said but he said that his normal and proper procedure when mortgages are involved would be to make sure the applicants are fully aware of what obligations they are under and to make sure they understand the nature of a mortgage before they sign the appropriate documents. The normal procedure is also to advise them that they have the opportunity to take it to a legal independent party to check it. He gave evidence that if someone is affected by drink or drugs he would certainly not undertake to do the documentation. He also gave evidence that he had no recollection of meeting the plaintiff at the home of the defendant. He was adamant that the execution of the Memorandum of Mortgage took place at Kent Town. The importance of his evidence as far as the defendant is concerned is that it cuts across the evidence of the plaintiff to the effect that she knew nothing about the loan of $135,000.00 and it was all organised by Petros behind her back. It also cuts across her evidence that that Memorandum of Mortgage was signed in ignorance by her at the home of the defendant.
Counsel for the plaintiff emphasised in his address to me that Mr Schaftenaar’s evidence is also contrary to the evidence of the defendant who remembers the plaintiff signing a document at his house although he cannot say what it was. Therefore he asked me to reject his evidence as to where that document was signed. In my view the evidence of Mr Schaftenaar is far more reliable than either the evidence of the plaintiff or the defendant on this topic. The defendant on Mr Schaftenaar’s evidence was not with him when the document was signed and the defendant himself says that he did not know the nature of the document that was signed at his house. In my view Mr Schaftenaar was a reliable witness who had no reason not to tell the truth. Both his diary note and the document and the mortgage itself indicates to me very clearly that it was executed at Kent Town. I now turn to specific topic of the Papas loan indenture.

Rody Papas

As I have indicated the topic of Mr Papas and the loan indenture is one which I wish to deal with separately from the rest of the evidence. Mr Papas was called by the plaintiff and produced a number of documents. He gave evidence that as of October 1995 he had acted for the defendant for some time. He told of a transaction which took place in which the plaintiff was his client. He gave evidence that the defendant attended with the plaintiff and told Mr Papas that he owed the plaintiff certain monies. He instructed Mr Papas to prepare a loan indenture reflecting that debt. The principle sum set out in the loan indenture which was owed by the defendant to the plaintiff was $195,000.00 and that sum was given by both parties. Three amounts were set out in the loan indenture as being “antecedent debts”. They were the amounts of $70,000.00 (April 1994), $68,000.00 (July 1994) and $60,000.00 (June 1995). The loan was secured by the registration of a caveat over the house of the defendant at 672 Goodwood Road, Daw Park. The term of the loan was for 15 years interest free. That caveat was withdrawn on the 21st December 1995. The document presented to me headed “Withdrawal of Caveat” was signed by the plaintiff and witnessed by Mr Papas. Both the caveat and the withdrawal of caveat were prepared by Mr Papas.
On the face of it the plaintiff argues that that loan indenture is clear evidence supporting her claim that in 1995 the defendant owed her a substantial amount of money thus corroborating her evidence that he had promised to pay the debts of his son.
The plaintiff when questioned on that topic gave the following evidence in answer to her counsel’s questions (transcript pp 151-153):-
"Q.... Did something happen in October ’95 which you recall.
A...... October ’95?
Q...... Yes, something perhaps a bit unusual for you.
A...... When I was called to - by the land broker, was it?
Q...... Who was that.
A...... I received a phone call and he said he was Mr Peter Maroudas’s land broker, he said to me ‘I have some papers ready for you to sign’.
Q...... You recall this person’s name.
A...... I didn’t know him at the time.
Q...... When he telephoned you did he introduce himself by name.
A...... Yes, he said his name on the phone.
Q...... What was that.
A...... Rody Papas.
Q...... After that phone call did you go and see Mr papas.
A...... Yes.
Q...... Where was his office, do you recall.
A...... No, I don’t know where his office is.
Q...... But you recall having a meeting with him soon after the phone call.
A...... Yes.
Q...... What happened at that meeting. Can you perhaps first relate who was there.
A...... I wasn’t sure who I went with, whether it was with Petros and his father, or whether I’d gone with just the father, but I went in there with him and I signed the papers and he said to me I would be getting so much, like a certain amount over time, that was it; he just explained to me and I signed the paper.
Q...... Who explained to you.
A...... The land broker.
Q...... Did he tell you how much you’d be getting.
A...... No.
Q...... You don’t remember -
A...... I can’t remember now whether he had said that. I don’t remember, but he explained to me I’d be getting that amount over different times. I’d be paid off.
Q...... Do you remember now whether he told you a dollar figure, or whether he didn’t mention a dollar figure at all.
A...... No, he mentioned the dollar figure when he was telling me the amounts.
Q...... This was an amount you were going to get on a regular basis, or -
A...... It was over a certain period of time I was going to get a certain amount each time.
Q...... You think he did mention a figure but you’ve forgotten it now.
A...... Yes.
Q...... And Mr Peter Maroudas was there while this conversation was occurring.
A...... Yes.
Q...... How long were you in Mr Papas’s office on this occasion.
A...... It was only for the time I was there to sign the papers.
Q...... And for the length of time it took him to make the explanation to you.
A...... He basically told me what was on the page, you know, and then he turned over and I had to sign it.”

In cross-examination in was put to her that the reason why she signed the loan indenture and the caveat was to do the defendant a favour. She denied that. It was put to her that the favour she was doing the defendant was that he was worried about being sued by another person and the reason she went to Mr Papas and signed loan indentures and the caveat and the authority to remove the caveat was simply to protect the defendant’s property should he be sued by someone else. In fact the transaction was a sham. She denied that that was the reason. She said that the removal of the caveat was because Petros threatened her and for no other reason.
In cross-examination on this topic her attention was drawn to a statement she had made to the Police, namely a Mr Steve Ryan on the 27th April 1997. She had gone to the Police and complained about the fact that she had been tricked into signing the mortgage for $135,000.00. It was put to her that she said to the Police the following in a record of interview that she had which was tendered in evidence (Exhibit D25). During that conversation she said the following:-
“Ryan said: yeah
Kyprios said:..... just after that he came up my son will come up to me goes to me oh he said I want you to do my dad a favour, I said what sort of favour. He goes oh he goes you just want to documented the land brokers you know he didn’t say what for he never told me anything you know he’d always like I always had to do it and he took me there and on it had I owe Katie??? Kyprios $200,000.00 you know and I didn’t ask, the land broker didn’t say nothing to me what it was for anything, he didn’t say nothing
Ryan said: well what was it for?
Kyprios said:..... I don’t know and only just recently I found out with Cindy that he’d put a ???? on his house for some reason and at the time he, that Peter Maroudas he said he was going to court for uh some place he worked for that sell Porches I think they were taking him to court or something because he’d taken some stuff away from them some pieces of parts of the car
Ryan said:so what’s this got to do with you signing a piece of paper for $200,000.00?
Kyprios said:..... I don’t know ha ha do I they never said nothing to me and then when it was time for me to like he said to me a couple of weeks later he goes to me oh he said umm I’ll take you back to the line brokers to sign it off and I said look I’m not going to sign this because I thought at the time I thought when I saw it I thought well must be cause the line the money they’re taken from me and that he was always said that he was going to pay the whole amount back you know all the money he’d taken from me as well as the loan you know cause he he’s taken from me over $70,000.00 and I thought with that and the $68,000 they’ve taken for that loan thing they’ve conned me into I thought maybe that was like to show that they were going to show me back, that’s what I thought they
Ryan said:how long ago was this?
Kyprios said:..... this was just after that loan business”

It is put by the defence that this supports the defendant’s version of the Papas loan indenture and is inconsistent with what she now says in Court namely that it was a legitimate acknowledgment of the money that he had promised to pay her.
The defendant in evidence said that the loan documents and the caveat were a sham. He gave the following evidence on that topic (transcript pp 379-381):-
"Q.... Can you tell us how that agreement, that has your signature on it, came to be drawn up.
A...... How did it come about is that, at the time, I had a lot of financial problems and there was a case about a car that Petros had sort of repaired as a panel beater.
Q...... Was Petros preparing it or did he have it at a panel beaters being repaired.
A...... It was my car and I had given it to the panel beater for it to be repaired.
Q...... Why was there a court case over this.
A...... Because Petros did a lot of changes to this sort of car and it reached the amount of $28,000.
Q...... You say ‘it reached an amount of $28,000’; was that an amount that you owed.
A...... That was including the court fees. I could not sort of let my wife handle that because I was really desperate.
Q...... So there was a court judgment for $28,000 against you.
A...... Yes.
Q...... What did this loan agreement, that was drawn up with Mr Papas, have to do with that.
A...... At that time I was in a desperate situation and I was afraid they might throw my wife out of the house, and I asked Katina - Katie - to go and draft a paper to show that I had borrowed a lot of money on these mortgage properties in order for them to sort of not take any action against me until I repaid this, to see what I could do after that.
Q...... Did you approach Mrs Kyprios yourself about that.
A...... Yes.
Q...... When you went to the land broker, Mr Papas, did you go with her.
A...... Yes.
Q...... Did you use any force or otherwise pressure Mrs Kyprios to go with you to Mr Papas.
A...... I’m not such a person. Never.
Q...... As well as drawing up the agreement, did you know or understand that anything was going to be put on the title to your properties.
A...... No.
Q...... After you went to Mr Papas did you ask Mrs Kyprios to go back to Mr Papas to do anything about that loan agreement that had been signed.
A...... In order to go and take it out after?
Q...... Yes, or anything like that.
A...... Yes, my wife had an insurance. My wife asked the insurance if she could borrow, before she died, if she could get $50,000, to sort of take from the insurance, and I rung the people, that the money was owing to, for the car, and I gave them straightaway $16,000 of the money that my wife had received, two cheques; one of $12,000 something and the other one for approximately $4,000.
Q...... After you paid them that money did you contact Mrs Kyprios and ask her to do anything about the loan agreement.
A...... I told Katina, ‘Now I’ve repaid these, any time you want, just get these withdrawals, to do away with it’.”

That explanation, if believed, does not put the defendant in a particularly favourable light. He was quite willing to organise a sham transaction in order to deceive a creditor. I have to decide which explanation I accept. Whether that document is as the defendant says or whether it is clear evidence as the plaintiff says of an admission that he owed her a substantial amount of money during that period of time.
In rebuttal the defendant also tendered a chronology of the Magistrates Court proceedings in which he was sued by a firm called Edwardstown Motor Repairs Pty Ltd (Exhibit D27). It is clear from that chronology of the Magistrates Court proceedings that at the very least there was the risk of a judgment being executed against the defendant in the latter part of 1995 in relation to work done on a Porsche motor vehicle and involving his son Petros. It is argued by the defendant that his evidence as to why the Papas documents were signed is supported by that chronology of events and the plaintiff’s evidence is inconsistent with what she said to the Police as set out above.
In relation to this aspect of the case I prefer the evidence of the defendant. I do that even acknowledging the fact that his explanation does not put him in a particularly satisfactory light. However his evidence is supported by the chronology of events as set out in Exhibit D25, by the fact that the caveat was removed despite the clear warnings given by Mr Papas as her adviser, the fact that if what she says is correct it seems strange that the defendant would volunteer to enter into a loan indenture and have a caveat placed over his property.
Looking at the evidence as a whole I make the following findings:-
The plaintiff, while heavily under the influence of Petros Maroudas, knew that she was borrowing $135,000.00 and she also knew she was paying $68,910.05 into the account of Peter Maroudas.

In coming to that conclusion I am influenced by the objective evidence of Julie Gilbert as set out above.

I do not accept the plaintiff’s evidence that she knew nothing about the payment of that money into the account of Mr Maroudas.

I find that the evidence of Cornelius Schaftenaar is both accurate and reliable. I find that the Memorandum of Mortgage was executed at his office at Kent Town. I prefer his version to that of the plaintiff on that topic. Even though the defendant talked about an occasion when the witness Schaftenaar was at his home he was uncertain as to what was actually being signed on that occasion.

I find that under the influence of Petros Maroudas the plaintiff, as her evidence indicates, was deceived of $38,000.00 in relation to the sale of the Range Rover and the buying of a Nissan. However I also find that that loss was a matter between her and Petros Maroudas and had nothing to do with the defendant.

I find that the defendant did not propose either in Greece or Australia to repay any of Petros’ debts to the plaintiff. In my view it has not been proved that such conversations took place.

I prefer the evidence of the defendant as to the reason why the loan indenture was prepared by Rody Papas and executed by the parties. Even though it does not put him in a favourable light there is enough objective material before me to prefer his explanation as to why the document was signed compared to the plaintiff’s explanation. In my view it makes no sense that the defendant would himself arrange for that indenture and caveat to be placed over his own property when at that time there appeared to be no demand from the plaintiff for him to do so. I do not accept the plaintiff’s evidence that that caveat was withdrawn because of physical violence or threats by Petros Maroudas.

I find that there is no evidence of a conspiracy between the defendant and Petros Maroudas to deprive the plaintiff of her money. I find that whatever money Petros Maroudas obtained from the plaintiff by either deceit or undue influence was a matter between them and had nothing to do with the defendant.

In the light of the above findings it follows that the defendant is not responsible for the debt of Petros Maroudas. Consequently the plaintiff’s claim is dismissed.

[2001] SADC 20

26 February 2001