Sibley v Willis - [2009] WADC 91

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: SIBLEY & ANOR -v- WILLIS [2009] WADC 91

CORAM: GROVES DCJ

HEARD: 5 JUNE 2009

DELIVERED : 19 JUNE 2009

FILE NO/S: CIV 2519 of 2006

BETWEEN: DEREK SIBLEY
CAROL SIBLEY
Plaintiffs
AND
ROBERT EDWARD WILLIS
Defendant

Catchwords:

Contract - Alleged oral agreement for loan of money - Uncertainty as to terms of alleged loan - Turns on own facts

Legislation:

Nil

Result:

Action dismissed

Representation:

Counsel:

Plaintiffs: Mr S Alteruthemeyer
Defendant: Mr R Bower

Solicitors:

Plaintiffs: Morgan Alteruthemeyer
Defendant: Corser & Corser

Case(s) referred to in judgment(s):

Davies v Taylor [1974] AC 207
Jones v Dunkel (1959) 101 CLR 298

GROVES DCJ: The plaintiff's claim that on or about 19 April 2005 they orally agreed to loan to the defendant the sum of UK £100,000 for a period of 12 months at an interest rate of 20 per cent per annum from 1 July 2005.
On or about 2 May 2005, the equivalent amount of AUS $243,745 ("the principal sum") was transferred and received into the defendant's bank account with StateWest Credit Society Limited having been transferred by the plaintiffs from the HSBC Bank in Halstead, United Kingdom (Exhibits 1 and 2).
On or about 17 November 2006, the plaintiffs through their solicitors made demand for repayment of the principal sum together with interest at 20 per cent per annum from 1 July 2005 until the date of repayment.
On 14 December 2006, the writ in this action was issued and it was served on the defendant on 9 January 2007. On 17 January 2007 a conditional appearance was entered by the defendant.
On 23 February 2007 default judgment was entered against the defendant.
On 24 July 2007 the defendant was given leave to defend on the issue of the claim to interest only.
On 7 July 2008 the defendant paid to the plaintiffs the principal sum pursuant to the judgment.
The defendant does not deny having received the principal sum. He denies however that the money was advanced by way of a loan or that interest was payable by him as alleged by the plaintiffs. The defendant says that in about April 2005 an arrangement was entered into whereby the plaintiffs agreed to invest the principal sum into the purchase of a property at 166 Geographe Bay Road, Quindalup ("the property") as part of a proposed development to be undertaken by the defendant. This proposed development involved the purchase of the property, the purchase of an adjoining property and the building of several units on the resulting block of land and the sale of those units for a profit.
The defendant says that in coming to that arrangement he informed the plaintiffs:
(a)that the development when completed was expected to produce a 20 per cent return on the money invested;
(b)that this return was expected to be realised within 18 months of the purchase of the property; and
(c)therefore the plaintiffs could anticipate making 20 per cent on their invested money within 18 months.
Nothing was reduced to writing.

Plaintiffs' evidence at trial

The female plaintiff was the one most involved in this dealing with the defendant. The plaintiffs resided in England and the defendant in Dunsborough, Western Australia. They have known each other and had been friends for many years. They had holidayed overseas together including in Spain where the plaintiffs were thinking that they might live. In December 2004 the plaintiffs at the invitation of the defendant came to Australia and stayed for 10 weeks with the defendant and his partner, Ms Jillian Bulters, at the property which the defendant at that time was renting. During that stay, the plaintiffs thought that they might like to live in the area rather than in Spain and so the female plaintiff made enquiries about employment in her trade as a cake decorator so as to gain sponsorship to come and live in Australia. The proprietor of a bakery at Dunsborough apparently indicated that he would sponsor the female plaintiff to Australia.
Prior to coming to Australia the plaintiffs had sold their property in England and had a sum in excess of UK £100,000 with their bank. The defendant was aware that they had that money in the bank. It was the female plaintiff's evidence that whilst they were staying with the defendant there was discussion about the defendant purchasing the property and undertaking a development. In her words "He was wanting to do this development of his and required some extra capital and would we loan him the money?" He said "… well if you loan it to us I'll give you 20 per cent interest. I only want it for a year". This discussion, she said, took place at the defendant's home and at the time were present both plaintiffs, the defendant and Ms Bulters. She said that she and her husband were agreeable to the defendants request for a loan of the principal sum on those terms. There were no other conditions and no other evidence of any other discussions concerning the monies at that time.
Following their return to England the plaintiff's arranged for transfer of the money to the defendant. At that time the female plaintiff says that she telephoned the defendant and told him the exchange rate. There was no evidence of anything further being discussed other than that she agreed to "send the money over".
Nothing came of the proposed sponsorship to Australia through the Dunsborough bakery. Nevertheless, the plaintiffs returned to Australia on 11 June 2005, were met at the Perth Airport by the defendant and Ms Bulters, and transported down to Dunsborough. There they resided with the defendant for a time before moving into a house in Troon Loop, Dunsborough owned by the defendant which they rented.
It was not until January 2006 that a working visa came through for the female plaintiff under the sponsorship of Ms Bulters. In the meantime the plaintiffs did some work for the defendant cleaning rental houses and the like. In March 2006 the plaintiffs returned to the UK for a short time before returning to Dunsborough towards the end of April or early May 2006. The female plaintiff said that just before a year was up after transferring the monies that the defendant inquired of her "…. Was it still OK for him to carry on borrowing the money for now …" to which "… we said yes". There was no evidence of any discussion about payment of any interest at that or any other time.
In late July/early August 2006 the plaintiffs became aware that the defendant and Ms Bulters were going overseas to the United States of America. It was the female plaintiffs evidence that she spoke to Ms Bulters and wanted some "… recognition that they had loaned the money, just for our security in case anything happened" to them whilst they were away. Ms Bulters indicated that she would speak to the defendant. Subsequently on or about 3 August 2006 the male plaintiff, on a visit to the defendant's home, collected a document (Exhibit 1) which is a photocopy of two cheques written out by the defendant and payable to the plaintiffs and an extract of his Credit Society account indicating the credit for the monies received from the plaintiffs. The first cheque is for the principal sum, viz $243,745. Alongside that and written by the defendant are the words "Total amount of loan. Commencement date 1/7/05" The second cheque is in the sum of $48,749. Alongside that is written "Interest on loan 20 per cent for 18 months." It is to be observed that to that date, 3 August, only 13 months had elapsed since the "commencement date".
The female plaintiff said that she had no discussion with the defendant about the document or the content of it. However, two to three days after receiving that document she telephoned Ms Bulters and told her that the plaintiffs were planning to return to the UK and wanted their money back. By that stage, there had apparently been a deterioration in the relationship as between the plaintiffs and the defendant and Ms Bulters. That, it was agreed, had nothing to do with the money. The defendant and Ms Bulters travelled to the USA and returned.
Meanwhile the plaintiffs sought legal advice and by letter dated 17 November 2006 their solicitors wrote to the defendant demanding repayment of the principal sum forthwith together with interest at the rate of 20 per cent per annum from 1 July 2005 until the date of repayment (Exhibit 3).
The plaintiffs returned to the UK in December 2006.
In cross-examination the female plaintiff agreed that it was in December 2004 when she and her husband first arrived in Western Australia on tourist visas. In her evidence-in-chief it had been put to her that it was February 2005. She said that she became aware during that time that the owner of the property was interested in selling it. She reiterated that it was during this stay and before their return to the UK in February 2005 that there was the discussion and agreement to loan the money. She said that there had been discussion about the purchase of the property and the adjoining property to do a development of five or six units.
There was also discussion about the plaintiffs returning to live in Dunsborough if the female plaintiff could get the appropriate working visa. She acknowledged that the defendant at some time had informed her that if they were only on a tourist visa then they would not be able to purchase property. When it was put to her that what was proposed (albeit, on the defendant's evidence, at a later date) was that the plaintiffs would be participants in the development as part of a syndicate of investors and that any money put in by them would go towards the purchase of the properties the female plaintiff emphatically denied those assertions. She was aware however that the defendant's ex-brother-in-law, Laurie Butler and Ms Bulters had a financial involvement in the property purchase. She maintained that the purchase of property had nothing to do with the plaintiffs.
Similarly, she denied that there had been any mention of a project term of 18 months. The only time that was mentioned was on the notation next to the cheque for interest (Exhibit 1). She asserted that the monies transferred were "never anything but a loan" with interest at 20 per cent initially for one year which they subsequently agreed would continue beyond that term.
The female plaintiff acknowledged that the defendant had passed on to the plaintiffs interest at the bank rate less tax, which the defendant had earned on the principal sum while the money was in his account. There was no evidence of any discussion about this being part of any arrangement nor any explanation as to why the plaintiffs received interest only at the bank rate being a rate which was much less than 20 per cent. Similarly, there was no explanation by the plaintiffs as to why it was that the 20 per cent was payable from 1 July 2005 when the money had been transferred in April although not received until 2 May.
She was aware that in June 2005 the defendant had some difficulty completing the purchase. The vendor had apparently increased the price. It was not at that time but rather about a year after the money was transferred, ie April/May 2006, that the defendant had offered on two or three occasions to return the money. Her response apparently on each occasion was that if it were returned, they would only spend it on something else. At that time, she was content to leave the money with the defendant.
The male plaintiff in his evidence said that it was his wife who "… does all the negotiations". He deferred to her. He gave evidence of an occasion when he went to the defendant's place, when he was given a piece of paper (Exhibit 1). He had gone there for another purpose but could not recall what that purpose was. He said that when he arrived the defendant went into the house and came out with the document and handed it to him. There was no discussion about the document. Asked what he knew about the arrangements he said "… he told us he wanted the money which we sent over and would pay us 20 per cent". Asked when that was told, he responded "Not exactly sure – I think it was in England – (he wanted it) round about a year – he was going to pay us 20 per cent."
In cross-examination he said that it was not he but it was his wife who raised the matter with Ms Bulters about recovering the money if anything happened to the defendant whilst overseas. He had not spoken to the defendant about it. The defendant gave him the document with no explanation.
In response to my question to him if he could recall when and where a loan was first mentioned he responded "not really". To my question whether he was present at the defendant's place when a loan was discussed he said "I can remember him telling us he wanted to borrow the money for a year and he would pay us 20 per cent. I can't remember where we were when we discussed it". My impression was that the male plaintiff was very vague in his evidence and had little knowledge of his own as to the arrangement.

Defendant's evidence

The defendant describes himself as having been a real estate speculator and developer and he also operated a boat hire business at Dunsborough. From about April 2002 he had rented the house on the property. He confirmed that he had had a long friendship with the plaintiffs. He was aware that the plaintiffs had sold their house in the UK and that whilst they were staying with him in early 2005 they expressed interest in coming to live in the Dunsborough area. It was his evidence that during the 10 week period, December 2004 – February 2005 whilst the plaintiffs were staying with him, there was no discussion about a loan of monies to him or the plaintiffs participating in any investment in land or development of units. At that time, he had no indication that the owner of the property was proposing to sell the property. He said he only became aware of that after the plaintiffs had returned to the UK.
When that situation arose he telephoned and spoke to the female plaintiff in the UK. It was mentioned that whilst the plaintiffs could not have afforded a house in the area he did say that there was an opportunity for them to participate in the intended real estate development. He informed her that the property was up for sale and that he, the defendant, was talking with the adjoining property owners with a view to combining the two properties which would make a five or six unit development site. He indicated that would probably take about 18 months and they would make probably a 20 per cent return on their money. The female plaintiff responded to the effect that it would be a good return. The defendant in a later telephone call went on to explain all he was going to do was get it approved for development and that they may do the development in conjunction with a builder or get it approved to sell it off as a development site.
Towards the end of April 2005, before he went on a trip to South Africa, the defendant put in an offer to purchase the property for $1.45 million. The named purchasers were himself, Ms Bulters, and his ex brother-in-law Laurie Butler. The plaintiff's money was received into his account whilst he was away in South Africa.
His evidence was that the plaintiffs could not be included as purchasers as they would be living in Australia under a tourist visa and it would take a minimum of 30 days to get approval from the Foreign Investment Review Board. Settlement was to have been on 4 July 2005. Settlement was delayed and he offered to return the plaintiffs' money to them. The female plaintiff requested that he hold onto it and, when it looked like this development might not get off the ground, that together they could look elsewhere for another development site. The defendant did pay to the plaintiffs the bank interest which he received on their money from the time it was received into his account up to the time when it was applied towards purchase of the property. Settlement was ultimately effected on 4 August 2005.
It was the defendant's evidence that the plaintiffs were investors into the property and development and that they would own a share of the net profit proportionate to the amount put in. He emphatically denied that it was ever a personal loan to him to bear interest at 20 per cent per annum.
As events turned out, the owner of the adjoining property was not prepared to sell and so the project which was envisaged could not proceed. The property, now transferred into the names of the defendant, Ms Bulters and Mr Butler was put up for auction on 15 April 2006 but did not sell. The property still remains unsold.
Prior to his departure to USA in August 2006 the defendant said that he had a discussion with the male plaintiff about acknowledging the receipt of monies by him in case something were to happen to him whilst overseas. To that stage there was no written record of any arrangement as between them so far as the monies were concerned. He agreed he would sort something out which he did and which is represented in the document Exhibit 1. The originals of the cheques were placed in an envelope and with his will, was left with his accountant. His intention was that if anything untoward did occur to he and Ms Bulters that the cheques would be passed to the plaintiffs thereby avoiding any claim on or difficulties for the plaintiffs in dealing with his estate.
It was the defendant's explanation that he used the word "loan" and referred to "interest on loan 20 per cent for 18 months" because, firstly, the plaintiffs names were not on the title to the property, towards the purchase of which the principal sum was utilised. Secondly, he believed that if the plaintiffs had received profit from their investment in the property they would have been liable for capital gains tax and there may have been possible adverse implications in not having gained Foreign Investment Review Board approval. Thirdly there may have been a possible liability on the part of the plaintiffs for Australian taxes. There was no evidence that any of that was mentioned to the plaintiffs at the time when the document, Exhibit 1, was given to the male defendant.
It was the defendant's purpose, so he said, that if anything untoward happened whilst on his visit to the USA that he would be standing by his indication to the plaintiffs that they stood to make a return of 20 per cent on their capital over the projected term of 18 months. This he said was done as a matter of personal goodwill having regard to the longstanding friendship which had existed with the plaintiffs. In further explanation in cross-examination he said that by doing this in this way he was providing the plaintiffs with some security in the event of his demise which reflected what would have been the outcome for them in the event that the development was completed within the estimated timeframe.
Again, in cross-examination he denied, when it was put to him, that he asked to borrow UK £100,000 or that he had offered to pay interest at 20 per cent on a loan. He was adamant that there was no arrangement for interest to be paid on the money. Nevertheless, bank interest which he received on the money whilst it was in his account was paid on to the plaintiffs.
In cross-examination the defendant seemingly conceded that the writing next to the cheques on Exhibit 1 was consistent with the agreement which he made with the plaintiffs. In re-examination he again agreed but when it was put to him again (and when he appeared to understand what was being put to him) he said that it did not represent the agreement.

Onus of proof

It is trite to say that the onus rests upon the plaintiffs to prove their case. That is, the plaintiffs carry the burden of satisfying the Court on the balance of probabilities that there was an agreement as between them and the defendant as alleged.

When speaking of a degree of cogency which evidence must reach in order that it may discharge the legal burden in a civil case Denning J in Davies v Taylor [1974] AC 207 at 219 said:
"That degree is well settled. It must carry a reasonable degree of probability, but not so high as is required in a criminal case. If the evidence is such that the Tribunal can say: 'We think it more probable than not', the burden is discharged, but if the probabilities are equal it is not."
In coming to a determination the Court must necessarily have regard to the whole of the evidence and weigh up the evidence of the various matters, consider the credibility or otherwise of the witnesses generally and what weight, if any, to attach to the evidence of the witnesses. In undertaking that process it is appreciated that it is some four and a half years since the arrangement was effected and by reason of that, recollections may not be as accurate now as they might have been at the time. There is also the risk of reconstruction to accord with subsequent events or discussion which may have occurred over the intervening period.
The evidence of the female plaintiff and the defendant is diametrically opposed. Two more different accounts as to when the arrangement was arrived at and what that arrangement was is hardly conceivable. They are in conflict, inter alia as to:
i.whether or not the property was for sale at the time of the plaintiffs' first stay at the defendant's home, December 2004 – February 2005;
ii.whether or not at that time there was discussion about purchase of the property and a unit development;
iii.whether or not at that time there was discussion about the defendant seeking to borrow the monies;
iv.the purpose for which the plaintiffs transferred the monies to the defendant;
v.the term for which the monies were provided;
vi.whether or not interest was payable on the monies; and
vii.which year it was that the defendant offered to return the money.

Dealing with credibility of the parties

Both the female plaintiff and the defendant gave their evidence positively and assertively. Neither of them were given to prevarication or obfuscation. They each gave their evidence in a straightforward and matter of fact manner. I can draw nothing from the demeanour of either of them as to the truthfulness or reliability of their evidence. The lack of detail in some aspects of the plaintiff's evidence and its shortcomings in so far as the pleaded case is concerned, as I will detail in my findings, does impact on the plaintiff's case. Contemporaneous documentation in the form of Exhibit 1 arguably supports the plaintiff's case but in the end result may be seen only to have caused the plaintiffs to construct the case as pleaded.
As I have indicated earlier, I found that the male plaintiff's evidence was vague at best. The only aspect of his evidence which I can accept and that because it was confirmed by the defendant was that he was at the defendant's house and that the defendant gave to him the document Exhibit 1. Otherwise his evidence was replete with "not exactly sure", "not really", and "I can't remember…" He was frank at least in acknowledging that his wife "… does all the negotiations". It was not apparent from his evidence that he was in fact privy to any "negotiations" so far as the alleged agreement is concerned. Rather it was my impression that as much as he might have known about such matters was conveyed to him by the female plaintiff. Accordingly I attach little weight to his evidence.

The rule in Jones v Dunkel

Ms Bulters was at court during the trial. When the order for witnesses out of court was made, she left the courtroom. Following the luncheon adjournment and whilst the defendant was giving evidence, defence counsel indicated that it was not his intention to call Ms Bulters. No explanation was forthcoming as to why she was not called.
The unexplained failure by a party to call witnesses or to lead evidence from a prospective witness on a relevant issue may, in appropriate circumstances, lead to an inference that the uncalled evidence would not have assisted that party's case. Whether or not she may have been able to give any relevant evidence is unknown. So far as the alleged agreement is concerned, that appears to have been something, so far as direct knowledge is concerned, as between the female plaintiff and the defendant. The female plaintiff did suggest at the time when the alleged agreement was made that it was at the defendant's house and that also present were the male plaintiff and Ms Bulters. Her evidence however did not go so far as to say that Ms Bulters did participate in the discussion or even that she was in the same room or within ear shot at the time when the female plaintiff and the defendant may have discussed such an agreement. The shortcoming of the female plaintiff's evidence in this respect is self evident. There is no basis for me to assume that Ms Butlers did participate in any discussion. Similarly, so far as the male plaintiff is concerned, there was no such direct evidence and again I cannot assume that his knowledge, so far as the alleged agreement is concerned, was in fact derived from a discussion as between the female plaintiff and the defendant at the defendant's house on a particular occasion as suggested by the female plaintiff.
On the other hand, it was the defendant's evidence that there was no discussion about the money whilst the plaintiffs were staying at his house in the early part of 2005. His discussion was with the female plaintiff after the plaintiffs had returned to the UK. There was no suggestion that Ms Bulters was privy to any such conversation.
There was also the female plaintiff's evidence that she called Ms Bulters about getting some acknowledgement of the loan. On the other hand the defendant says that he spoke with the male plaintiff. The male plaintiff's evidence supported his wife's account and I am prepared to accept that. If that were the only matter on which Ms Bulters could give evidence then little turns on it.
In the circumstances I am not prepared to draw an inference one way or the other as to whether or not Ms Bulters may have been able to give relevant evidence on the matter in issue or whether her evidence would not have assisted the defendant's case or be likely to be favourable to the plaintiff's case (see Jones v Dunkel (1959) 101 CLR 298).
In any event this issue does not impact on my primary findings so far as the alleged agreement is concerned.

Findings of fact

The plaintiffs' case relies upon a finding that on or about 19 April 2005 it was orally agreed as between the plaintiffs and the defendant that the plaintiffs would loan the principal sum to the defendant for a period of 12 months at a rate of interest of 20 per cent per annum from 1 July 2005.
Upon an analysis of the evidence I have come to the view that the plaintiffs have failed to satisfy me on the balance of probabilities that an agreement as alleged was entered into. I enunciate the following matters which lead me to that view.
First is the issue as to when the alleged agreement was made. The plaintiffs plead that it was "on or about 19 April 2005…" The female plaintiff's evidence was that there was agreement to loan the monies prior to the plaintiffs returning to the UK in February 2005. The two assertions are not compatible. I suspect that the plaintiffs have seized on the 19 April 2005 date because that was the "value date" for the exchange of their pounds Sterling to Australian dollars (see Exhibit 2). In any event, the transfer request (Exhibit 2) is dated and bank stamped 15 April 2005. This suggests that if there was an agreement as alleged then it certainly preceded that date. There was no evidence that either on or about 15 or 19 April 2005 there was any discussion as to the terms of any alleged agreement. On the female plaintiff's evidence as much as was said at about that time was that she informed the defendant of the exchange rate. There was no evidence of anything further being discussed. The fact that the exchange rate was calculated as at 19 April 2005 is not evidence of itself of any agreement or the terms of any such agreement.
Accordingly, I am not able to conclude that in fact the agreement as alleged or for that matter any agreement was made on or about 19 April 2005.
Secondly, there was no evidence from the plaintiffs that it was orally agreed that interest would run from 1 July 2005 as alleged. In the discussion which is said to have taken place at the defendant's home before the plaintiffs returned to the UK there was not (or at least there is no evidence of) any mention as to when interest would commence to run. The money was received into the defendant's bank account on 2 May 2005. It had apparently "got lost" for the period between 19 April and when it went into the defendant's account. The defendant paid the plaintiffs the bank interest earned on the money, less tax, whilst it was in his account. This interest was much less than a rate of 20 per cent. The plaintiffs seemingly have no issue with this. There was no evidence of there having been any discussion in so far as this lesser rate of interest for that period of time. One explanation might be that they accepted the bank rate of interest well knowing that the funds were "on hold" to be invested as participants in the proposed development.
On the other hand, it might reasonably have been expected from what the female plaintiff has said, viz interest of 20 per cent per annum for a year, that interest at that rate would be payable from the time the monies were received into the defendant's bank account. There was no evidence or explanation as to why that was not the case. I conclude however, that the plaintiffs have seized on the date of 1 July 2005 because that is the date which the defendant wrote alongside the photocopy of the cheque for the principal sum (see Exhibit 1). The fact that the defendant wrote "commencement date 1/7/05" does not prove that it had been orally agreed either back in April or for that matter in February 2005 that interest at the rate of 20 per cent per annum was to be payable from 1 July 2005. There has to be another explanation which I will advance shortly.
I conclude that there was no oral agreement between the parties as to the commencement date, viz 1 July 2005, for payment of interest on the monies at the rate claimed. In my opinion, the plaintiffs have simply seized on this date by constructing their claim around the document Exhibit 1. That is so because there was no oral evidence as to a commencement date for interest at 20 per cent ever having been discussed.
Thirdly, on the female plaintiff's evidence, there is an unexplained pause between the time when the plaintiffs returned to the UK in February 2005 and the transfer of the money to the defendant which she instigated on 15 April 2005. The female plaintiff's evidence was that she arranged for transfer of the money to the defendant "following their return to England". If, on the female plaintiff's evidence, the agreement had been made to loan the money prior to their return to the UK there is no explanation as to a delay of about six weeks in doing so. After all, the interest rate was very attractive, as the female plaintiff agreed. She gave no evidence of there having been any telephone discussions with the defendant in that intervening period other than to advise the exchange rate. On the other hand, it was the defendant's evidence that he did telephone the female plaintiff on a number of occasions during this period of time prior to his departure to South Africa. The point to be made here is that if agreement to loan the money had been made in February 2005 (albeit that it is pleaded that the agreement was in April 2005) why was the money not transferred earlier. Had it been so, then that may have added some credibility to the female plaintiff's evidence. But there was simply no evidence or explanation for this inconsistency. Conversely though, it does lend some credibility to the defendant's evidence so far as the content of his telephone discussion with the female plaintiff about the investment opportunity in April 2005.
Fourthly, and perhaps of small moment, I noted that at the commencement of the female plaintiff's evidence it was put to her (perhaps erroneously by her counsel) that she first came to Australia in February 2005. In fact, as she acknowledged in cross-examination, it was in December 2004 that they arrived. Nevertheless in her evidence‑in‑chief she was prepared to adopt the later date. Whilst this may reflect on the reliability of the female plaintiff's evidence I don't need to attach any weight to it.
Fifthly, I find that the defendant's evidence in so far as the circumstances and timing of the transfer of the monies to him is plausible, as is his explanation for what he wrote alongside the photocopies of the two cheques (Exhibit 1). In that respect, he wanted to be doing the right thing by his longstanding friendship with the plaintiffs in ensuring that in the event of anything untoward happening to him whilst in the USA that they would recover the monies which he, the defendant, had indicated would be the likely return upon completion of the development. He was protecting their position as they had requested he do. That is evident from the fact that the cheque for interest was for 18 months at a time when in fact only 13 months had elapsed from the "commencement date". His explanation as to his underlying thinking for writing the notations alongside each cheque, whilst not commendable in the sense of possibly assisting the plaintiff's evading certain fiscal obligations, can nevertheless, in these circumstances, be seen to be plausible. It is consistent with having had a longstanding friendship with the plaintiffs.
The defendant provided no explanation as to why it was that he expressed the "commencement date" as "1/7/05". Bear in mind that the cheques were dated 3/8/06. 1 July 2005 did approximate what was the intended settlement date for the purchase of the property. Again, the explanation may be that the plaintiff's money was "on hold" until utilised towards purchase of the property. Once utilised however it was subject to the indicated return of 20 per cent after 18 months. In that way the approximation of the "commencement date" is consistent with the defendant's evidence as to the investment opportunity he conveyed to the female plaintiff.
Further the notation to the second cheque "20% for 18 months", does not support the plaintiffs' contention of an agreement of 20 per cent per annum. The cheque is in the sum of $48.749.00 which is 20 per cent of the principal sum. Had it been 20 per cent per annum the interest for 18 months would be $73,123.50. That being the case also lends weight to the defendant's evidence of a 20 per cent return over 18 months.
Finally I have arrived at the opinion that the plaintiffs have seized upon what was otherwise the goodwill of the defendant in constructing the claim of the alleged agreement as pleaded around what was much later and for other reasons written by the defendant against the two cheques (Exhibit 1). That is, they have endeavoured to fit the alleged agreement around the document when in fact there was no agreement as alleged at all. They have done that by adopting a commencement date for interest of 1 July 2005 when, on my findings, there was no oral discussion as to a commencement date. Similarly, they have constructed the date of the oral agreement around the date when the exchange rate was calculated and when, as I find, there was no evidence of any oral agreement as alleged being discussed at that time. Furthermore, the lack of any explanation as to the acceptance of a bank rate of interest following the transfer of funds, is not consistent with there having been any agreement for interest on the monies at 20 per cent per annum as alleged. On the other hand the date 1 July 2005 was immediately prior to what had been expected to be the settlement date on purchase of the property. That that was the date noted by the defendant is, in my view, more consistent with his evidence that the plaintiffs' monies were to be put towards the purchase of the property with them being participants in the development and sale and sharing of profits proportionately. Likewise, as earlier noted, the notation of "20% for 18 months" against the second cheque does not support the plaintiffs' contention of an interest rate of 20 per cent per annum and in my view their reliance on that notation is misplaced.

Conclusions

Having regard to all the evidence and for the reasons enunciated I am not able to be satisfied to the requisite standard, ie that being on the balance of probabilities that the parties entered into an oral agreement as alleged by the plaintiffs in paragraph 1 of their statement of claim. Accordingly, their action must fail.
Although the plaintiff's solicitors have provided a schedule of interest calculations for various outcomes it is not necessary in light of my findings to address this.
It is the fact that default judgment for the principal sum was entered against the defendant on 23 February 2007.
Pursuant to s 8 of the Civil Judgment Enforcements Act 2004 the defendant is liable to pay to the plaintiffs interest at 6 per cent per annum on the judgment sum from 23 February 2007 until 7 July 2008, this being the date upon which the defendant paid the judgment sum to the plaintiffs.
The defendant therefore owes the plaintiff $20,035 interest, this being interest at 6 per cent per annum on the judgment sum of $243,745 calculated at $40.07 per day for 500 days.
The interest component is enforceable as a consequence of the judgment having been entered and consequently there is no need for any order to be made by this Court after trial for that sum.