Richard Ernest Griffin v Barbara Noeleen Baker - [2010] ACTSC 46

RICHARD ERNEST GRIFFIN v BARBARA NOELEEN BAKER
[2010] ACTSC 46 (13 May 2010)

MONEY LENT – recovery of loan moneys – oral loan agreement – calculation of interest
LIMITATION of ACTIONS – action for recovery of money lent – when time began to run

VL Finance Pty Ltd v Lagudi & Anor [2003] VSC 57; (2003) 54 ATR 221

EX TEMPORE

No. SC 299 of 2008

Judge: Master Harper
Supreme Court of the ACT

Date: 13 May 2010

IN THE SUPREME COURT OF THE )
) No. SC 299 of 2008
AUSTRALIAN CAPITAL TERRITORY )

BETWEEN:RICHARD ERNEST GRIFFIN
Plaintiff

AND:BARBARA NOELEEN BAKER
Defendant

ORDER

Judge:  Master Harper
Date:  13 May 2010
Place:  Canberra

THE COURT ORDERS THAT:

Judgment be entered for the plaintiff in the sum of $86,818.46

The defendant pay the plaintiff’s costs.

This is a claim by the plaintiff for repayment of money lent to the defendant and for interest. There had been a history of loans by the plaintiff to the defendant prior to the loans which are the subject of this action, and the amount which had been lent by the plaintiff to the defendant of some $38,000.00 had been repaid by the plaintiff out of money she had recovered as damages for personal injury arising out of a motor vehicle accident.
I am satisfied that in late October or early November 2000 the plaintiff lent the defendant $50,000.00. I am satisfied that at the time of that loan the plaintiff and the defendant had agreed that she would pay him $3,000.00 representing interest in relation to the earlier repaid loan, and that she would repay the $50,000.00, together with a fixed sum agreed for interest on it, regardless of the length of time which might pass before it was repaid, of $10,000.00.
On 7 November 2000 the defendant signed an irrevocable authority in favour of the plaintiff prepared by the solicitors who were acting for her in at least one, and perhaps more, personal injury or compensation claims authorising payment out of settlement moneys received by the solicitors into the plaintiff’s bank account in an amount of $63,000.00, representing the $50,000.00 loan, the $10,000.00 interest on that loan and the $3,000.00 agreed interest on the previous repaid loan.
I am satisfied from that document that the plaintiff was aware that the defendant did not have sufficient funds to repay any of the loan immediately, and that the expectation of both plaintiff and defendant was that there would be sufficient funds once her damages claim was finalised, and that she would repay the money out of the proceeds of her claim.
I am satisfied that on 27 April 2001 the plaintiff lent the defendant a further amount of $1,600.00 and that on 5 September 2001 he lent her a further amount of $18,000.00, although there is no evidence that either of those loans was the subject of any written agreement or was documented between the parties at all.
On 12 April 2002 Master Connolly, as his Honour then was, gave judgment in the plaintiff’s claim for damages against Woolworths Ltd arising from an injury in a Woolworths store in which his Honour generally did not accept the plaintiff’s case and awarded minimal damages of $2,134.00. I am satisfied that the plaintiff did not receive any money as a result of that judgment. Neither the plaintiff nor the present defendant had contemplated such an outcome of the damages claim.
On 16 April 2008 the plaintiff commenced the present action in this court. The claim asserts that it was a term of the loan that the defendant would repay the plaintiff the moneys owed within a reasonable period of time, which the plaintiff believed would be about three to five years. There is evidence in the form of a letter from the defendant’s then solicitors to the plaintiff from which it is apparent that the plaintiff had asked for a further document claiming a total amount of about $92,000.00. It is apparent that no such document was forthcoming, and that other than her equity in her house the defendant had no available funds or assets to make any payment to the plaintiff.
The plaintiff has given oral evidence and there is additional documentary evidence in the form of the plaintiff’s bank books. I did not find the plaintiff a particularly reliable witness and would not generally accept his evidence of his recollections of events of the time (now approaching 10 years ago) with any confidence. I prefer the contemporaneous written records where they are available.
The defendant has not given evidence and the plaintiff’s evidence is unchallenged, other than by cross‑examination. The principal defence is that the action is statute-barred, the cause of action having arisen more than 6 years prior to the commencement of proceedings. It is clear from the facts I have already found that all of the loans were made considerably more than 6 years before the proceedings were instituted. Counsel for the defendant submits that on the authority of a decision of Nettle J of the Supreme Court of Victoria in VL Finance Pty Ltd v Lagudi (2003) 54 ATR 221; [2003] VSC 57 and earlier authorities cited by his Honour in that judgment that I should find that, there being no written contract in relation to the loan, the loan became repayable forthwith.
I am not satisfied that that was the intention of the parties. I am satisfied that there was some discussion between the parties as to the terms and, having regard to my finding that both parties were aware that the defendant had no funds from which she could make immediate repayment, but that she expected to receive funds from the proceeds of her damages action, that it was a term of the agreement in relation to each loan that the loans would be repaid promptly after the defendant received funds as a result of her claim.
In the event, as I say, that did not happen. After 12 April 2002 it was apparent, certainly to the defendant, that she was not going to be in a position to repay the loan immediately. The evidence is unclear as to when the plaintiff discovered that. I am unable to read the letter from Higgins Solicitors to the plaintiff of 8 October 2002 as evidence that he had made a demand for repayment. On the contrary, it appears that he had simply sought a further or substitute irrevocable authority.
There being no evidence of any formal demand for repayment prior to the commencement of the proceedings on 16 April 2008, I am unable to arrive at any specific date on which I could find that the amount claimed became repayable, but I am satisfied that there was an agreement between the parties and that it was part of that agreement that the amount was not to become repayable until a date which, in the event, must have been within the 6-year period before proceedings were commenced. In those circumstances, the limitation defence fails.
As to quantum, I am satisfied that the plaintiff is entitled to recover the amount acknowledged by the defendant in the irrevocable authority and the two further loans which I mentioned. As to the loan of $50,000.00, it was agreed between the parties that that loan was to attract a total lump sum of interest of $10,000.00. I am not satisfied that there is any basis for any further award of interest on that sum prior to judgment. The other amounts claimed, a total of $22,600.00, should attract interest at the rate prescribed by the Court Procedures Rules but I am not satisfied that the evidence warrants an award of interest calculated from a date any earlier than the date proceedings were commenced.
The plaintiff should recover a total amount of $82,600.00 plus interest on $22,600.00 from 16 April 2008 to the date of judgment, $4218.46.
There will be judgment for the plaintiff for $86,818.46. I order that the defendant pay the plaintiff’s costs.

I certify that the preceding fifteen (15) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Master.
Associate:
Date: 21 May 2010

Counsel for the plaintiff:  Mr WL Sharwood
Solicitors for the plaintiff:  Slater & Gordon
Counsel for the defendant:  Mr RJ Arthur
Solicitors for the defendant:  Dickson Legal
Date of hearing:  12 & 13 May 2010
Date of judgment:  13 May 2010