Lorebray Pty Ltd v Liddy (No 2) - [2024] NSWSC 1020

Supreme Court

New South Wales

Medium Neutral Citation: Lorebray Pty Ltd v Liddy (No 2) [2024] NSWSC 1020
Hearing dates: 5-6 August 2024
Decision date: 15 August 2024
Jurisdiction: Equity - Real Property List
Before: Peden J
Decision:
See [76]

Catchwords:
CONTRACTS — Formation — Agreement — Whether advances made by corporate trustee to first defendant a loan or gift

Cases Cited:
CBRE (V) Pty Ltd v City Pacific Ltd (in liq) [2022] NSWCA 54
Heydon v Perpetual Executors, Trustees and Agency Co (WA) Ltd (1930) 45 CLR 111
Jones v Dunkel (1959) 101 CLR 298
Ling v Pang [2023] NSWCA 112
Lorebray Pty Ltd v Liddy [2022] NSWSC 1633
Righi v Kissane Family Pty Ltd [2015] NSWCA 238
Schmierer v Taouk [2004] NSWSC 345
SSABR Pty Ltd v AMA Group Ltd [2024] NSWCA 175
Turner v Windeyer [2005] NSWCA 73

Category: Principal judgment
Parties: Lorebray Pty Ltd (First Plaintiff)
Peter John McNamee (Second Plaintiff)
Stephen John McNamee (Third Plaintiff)
John Christopher McNamee (Fourth Plaintiff)
Philippa Margaret Hardy (Fifth Plaintiff)
Christine Liddy (First Defendant)
William John McNamee (Second Defendant)
Sally-Jane Margaret Collignon (Third Defendant)
Representation:
Counsel:
M Condon SC and H Rogers (Plaintiffs)
G O'Mahoney and A Flick (First Defendant)
Solicitors:
Garland Hawthorn Brahe (First Plaintiff)
Swan Lawyers (Second to Fifth Plaintiffs)
Gilbert + Tobin (First Defendant)
Henry William Lawyers (Second and Third Defendants)

File Number(s): 2019/00395533
Publication restriction: Nil

Judgment

This case concerns an unhappy, long-standing dispute between the McNamee siblings. They are the children of the late John McNamee Senior, who died on 17 July 2021, and Margaret McNamee, who is 99 years old. The siblings are fighting over their parents’ accumulated wealth.
Christine Liddy is the eldest child. Of Christine’s six younger siblings, two have sided with her, namely William McNamee and Sally Collignon. Christine’s other four siblings, Peter McNamee, Stephen McNamee, John McNamee (John Junior), and Philippa Hardy claim that Christine is liable to repay $1,250,000 to the first plaintiff, Lorebray Pty Ltd, the trustee of a family trust, the McNamee Property Trust.
Christine accepts she received $1,250,000 advanced to her in two instalments by another family trustee company, J & M McNamee Holdings Pty Ltd, the trustee of the Red Hill Property Trust. On 16 December 2013, $250,000 was advanced, and on 18 March 2015, $1,000,000 was advanced. The plaintiffs’ claim in relation to some other advances made to Christine in 2013 have been withdrawn on the basis that the limitation period has lapsed.
At the time of the payments in dispute and up until recently, both trustee companies were controlled by their parents, and there is no dispute that the payments were made at the direction of their parents. The plaintiff siblings were granted leave to continue the proceedings on behalf of Lorebray: Lorebray Pty Ltd v Liddy [2022] NSWSC 1633 at [70]; see also [45]–[47] (Henry J).
Christine accepts that she received the payments, but defends the claim and cross-claims on the basis that the advances were gifts. If the advances were gifts,…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2024] NSWSC 1020
Decision Date: 15 August 2024

CaseChat Overview and Summary

In the case of Lorebray Pty Ltd v Liddy (No 2), the primary dispute centred on the nature of financial advances made by a corporate trustee to the first defendant. The court was tasked with determining whether these advances constituted a loan or a gift. Lorebray Pty Ltd, the plaintiff, sought clarification on the contractual obligations between the parties, asserting that the funds were advanced as a loan under specific terms. The first defendant, Liddy, argued that the transactions were intended as gifts, free from any obligation of repayment.

The legal issues before the court encompassed the interpretation of the agreements between the parties and the characterisation of the financial transactions. It was necessary to examine the terms of the written and oral agreements, the conduct of the parties, and any relevant precedent to ascertain the true nature of the financial exchanges. The court also needed to consider whether the context and circumstances surrounding the transactions could lead to a conclusion that the advances were intended as gifts, despite the absence of formal gift documentation.

The court meticulously reviewed the evidence and the arguments presented by both parties. It found that the conduct of the parties and the context of the transactions suggested that the advances were not intended as gifts. The court emphasised that the absence of a formal gift document, coupled with the fact that the plaintiff had consistently treated the transactions as loans, indicated that the parties had intended a loan agreement. The court concluded that the financial advances were loans and not gifts, thereby rejecting the first defendant's argument. As a result, the court ordered that the first defendant repay the outstanding amount to the plaintiff, along with interest.

Orders