Terrblance v Jewell

[2012] QDC 362

DISTRICT COURT OF QUEENSLAND

CITATION:

Terrblance v Jewell  [2012] QDC 362

PARTIES:

SHERIE CHARLOTTE HELEN TERRBLANCE
(Plaintiff)

AND

JULIA EDITH JEWELL AND PETER JEWELL
(Defendants)

FILE NO/S:

D60/07

DIVISION:

PROCEEDING:

Civil Trial

ORIGINATING COURT:

District Court, Brisbane

DELIVERED ON:

14 December 2012

DELIVERED AT:

Brisbane

HEARING DATE:

10, 11 April 2012

JUDGE:

McGill SC DCJ

ORDER:

Judgment that the first defendant pay the plaintiff $31,513.14 including $17,444.42 by way of interest.  Plaintiff’s claims against the defendants otherwise dismissed. 

CATCHWORDS:

MONEY LENT – action to recover – whether payments loans or gifts – whether money from bank accounts misappropriated – terms of loan agreement.

COUNSEL:

N Sharma (Solicitor) for the plaintiff

Defendants in person

C Stevenson (Solicitor) for the applicant

SOLICITORS:

Sharma Lawyers for the plaintiff

The Defendants were not represented

1. This matter began in 2007 with a claim by a woman seeking to recover from her daughter money borrowed and money misappropriated, and the return of certain chattels.  It was alleged that the defendant borrowed various sums from the plaintiff which had not been repaid, and that the defendant had withdrawn from the plaintiff’s bank account over a period of some years a large number of sums which were expended for her own use and benefit.  Recovery of certain antique furniture and other items was also claimed. 

1. The action has evolved somewhat over time.  The daughter’s husband was added as a defendant in 2008, and in 2011 the plaintiff died, so that it was necessary to substitute her executrix as plaintiff[1]; she is pursuing the action on behalf of the estate.  Money was paid into the plaintiff’s solicitor’s Trust Account after the second defendant sold some land he owned.  Finally, a former solicitor of the defendants has applied to be joined as a party to be proceeding, apparently with a view to preserving the benefit of an unregistered mortgage that he was given in respect of his claim for costs.  That application was adjourned to the trial, and the applicant was allowed to participate at the trial; in a sense as a result the defendants had the benefit of this, since in most respects there was a coincidence of interest between him and the defendants.

   [1]This was done by order of another judge made 13 December 2011.  It follows from this order that the present plaintiff is entitled to enforce any cause of action that the deceased had against the defendants or either of them.

The Pleadings

1. The pleadings have also been amended from time to time.  In the final version the plaintiff’s claim may be summarised as follows.  The deceased lent the six separate amounts to the first defendant between 6 January 2002 and 13 December 2004, which the first defendant has failed to repay.  The first defendant alleged that: the first, of $1,000 was a gift; the second was for a ride-on mower purchased by the deceased’s partner; the third was not made to or for  the first defendant; the fourth was a payment made for the benefit of the deceased’s de facto; the fifth was to purchase a water tank for the deceased which was kept at the defendant’s house; and the sixth was for items used by the second defendant and the deceased’s de facto.

1. The plaintiff alleged that on about 1 November 2002 the deceased lent $46,000 to the first defendant, only part of which had been repaid.  The defendants admitted that loan, but said that most of it was repaid by regular repayments, and it was finally discharged by agreement between the deceased and the first defendant for a lump sum payment of $10,000.

1. The plaintiff also alleged that between 4 November 2002 and 7 January 2004 the first defendant without the deceased’s knowledge or authority used a Power of Attorney and withdrew for her own benefit various amounts totalling $74,356.42 from the deceased’s bank account.  The first defendant admitted that she withdrew these amounts, but said that the withdrawals were authorised by the deceased.  It was also alleged that in July 2003 the first defendant withdrew $10,000 from the deceased’s bank account and placed it in the name of the deceased and the first defendant as a term deposit.  It was further alleged that $5,000 from this amount was then transferred to the defendant’s account, and subsequently the balance was placed in a new term deposit in the name of the deceased and the first defendant although subsequently that account was also closed and the balance transferred to the defendant’s account.  The defendants say that these acts were done on the instructions of the deceased.

1. It was further alleged that in 2004 the first defendant withdrew $30,000 from the deceased’s account and placed it on term deposit in the name of the first defendant and the deceased’s de facto; subsequently $20,000 of this was transferred to the defendant’s account with only the balance paid back to the deceased.  It was further alleged that a further sum of just over $10,000 was transferred from the deceased’s account to the defendant’s account in September 2004, and that in December 2004 or January 2005 a further $1,784.77 was withdrawn from the deceased’s account and used for the benefit of the first defendant.  Recovery of all these sums was sought.  The defendants said that these things were done on the deceased’s instructions.

1. It was further alleged that the deceased became the owner as a result of her late brother’s death of certain items of jewellery, power and hand tools worth $24,000  which the first defendant collected for the deceased at her request, but had retained.  The defendants alleged that such of the jewellery and tools as came to the defendants had been returned to the solicitors for the deceased in 2005.  It was further alleged that in December 2004 the deceased lent certain antique furniture worth $20,000 to the first defendant which the first defendant had refused to return.  The defendants admitted that they received this furniture, but said they attempted to return it and, when the deceased refused to accept it back, disposed of the items which were a gift to them. 

Evidence

1. The death of the mother meant that she was not available as a witness at the trial.  This greatly impaired the plaintiff’s capacity to prove her case.  Two affidavits sworn by the deceased[2] were put in evidence, but apart from the obvious fact that the deceased was not available for cross-examination, the content of the affidavits was often sketchy, and not related in detail to the case as currently pleaded by the plaintiff, so that they were of limited use as evidence for the plaintiff. 

   [2]Exhibit 3, filed 29 February 2008; Exhibit 36, filed 4 April 2007.

1. Apart from that, there was oral evidence from the deceased’s former partner, Mr Axelsen, but his evidence also suffered from various limitations.  In the first place, it was obvious that he had limited personal knowledge of the transactions referred to in the pleadings.[3]  He was not in a position to give evidence about the state of mind of the deceased, or about what had passed between the deceased and her daughter on occasions when he was not present.  There is also the consideration that his evidence reflected some degree of hostility towards the defendants.  That may be an understandable response if the claims in the pleading are true, but it may also be a manifestation of hostility within the family which led to the making of claims which are false or unjustified.

   [3]At one point he said he was aware of 75 – 80% of her agreements with the first defendant: p 38.  See also  p 69.

1. Mr Axelsen said that he had been the de facto husband of the deceased from 1987 until 28 December 2008: p 5, 91-2.  During that time her health had declined, and for some years before the end of the relationship she was effectively confined to a wheelchair, needing a hoist to get out of bed, and having great difficulty in moving around in any other way.[4]  She could still drive a car, though she otherwise needed assistance to get about: p 49, p 56.  Towards the end he thought her mind was going as well (p 31), though there is no medical evidence about this.[5]  There were periods during the relationship when it broke down (p 38), and ultimately the relationship broke down completely, to the point where he did not even attend her funeral. 

   [4]The first defendant said she was on crutches: p 30.  This may have been at an earlier time.

   [5]The first defendant denied this: p 34.

1. He said that he was aware of various family arguments while he was in the relationship: p 38.[6]  He knew the first defendant from when she was going to high school, and gave her away when she was married: p 5.  He and the deceased had carried on a business, or more than one businesses, associated with pet supplies in a rented shed until October 1999 when most of the business was handed over to the defendants: p 12.[7]  He continued with some business activities for a short time, but gave up everything, or almost everything, when GST was introduced.  The deceased had two bank accounts, a cheque account and a pensioner account: p 9.  The deceased appointed the first defendant her attorney on 18 February 2002: Exhibit 27.[8]  This was revoked by the deceased in about May 2005: p 11.  On 15 April 2009 the deceased made her last will; Exhibit 12.  It made no provision for the first defendant “as I have lent her over $120,000 and she has made no repayment of any of these moneys...”.

   [6]The first defendant described the family as very dysfunctional: p 132.

   [7]The first defendant said it came to the second defendant: Exhibit 29 para 1.

   [8]The first defendant said this was so that she could sign documents in connection with her uncle’s estate:  p.131.

Loans

1. The plaintiff’s case was that the six cheques referred to in paragraph 2 of the statement of claim reflected loans made by the plaintiff to the first defendant.  Copies of the cheques are in Exhibit 1.  Cheque 662 for $1,000 was payable to the first defendant and was completed and signed by the first defendant: p 14.  The first defendant said that this amount was a gift to her from the deceased, and that two other children of hers received similar gifts: p 139.  Cheque butts 552 and 553 from the deceased’s cheque book show amounts each of $1,000 to “Peter” on 2 November 2002 and “Helen cash” on 3 November 2002: Exhibit 16.  There is no mention of this in the affidavits of the deceased, Exhibit 3, and all that Mr Axelsen could say was that the cheque had been signed by the first defendant, which is not controversial.  The deceased in her other affidavit put this cheque amongst those said to have been “misappropriated”; there was no reference to any loan.[9] Although it seems a little odd that the cheques to the siblings came so much later in the year than the cheque to the first defendant, there is simply no evidence to contradict the evidence of the first defendant in relation to this cheque. 

   [9]Exhibit 36 paras 13, 14; cheque 662 is on p 18 within Exhibit F.

1. Cheque 568 was signed by the deceased and was for an amount of $550; no payee was identified, but Mr Axelsen conceded that it was for a ride on mower: p 14.  The butt was blank, but the defendant produced an invoice dated 3 January 2003, the date specified in the Statement of Claim, from Mowers West for a ride on mower in this sum, the invoice being in the name of Mr Axelsen: Exhibit 17.  The first defendant said that the cheque was in Mr Axelsen’s handwriting, apart from the signature: p 142.  He said that he signed for that mower, but it went directly to the defendants’ residence and it was returned about two or three years later in an unworkable condition: p 11, p 14.  There is however no claim in respect of any loss or damage to the mower.  It seems clear that that was not a loan of money to the first defendant.

1. Cheque 668 was signed by the deceased and payable to the first defendant in the sum of $700.  Mr Axelsen said the cheque was given to the first defendant so that she could pay the wages of her sister who worked for her at the time, and the deceased would help them at times so that there would be money to pay Helen’s wages: p 14.  The cheque butt Exhibit 17 has “Helen 9-1-03” written on it by the deceased: p 141.  The first defendant said that it was simply a gift to her”: p 139.  In her affidavit she said she gave the proceeds to her sister and to the deceased.[10]  In her affidavit the deceased said that the defendant borrowed money now and then, but then gave as an example this cheque, which “I gave her”[11]  It has not been shown to be a loan to the first defendant.

   [10]Exhibit 29 para 5(a).

   [11]Exhibit 36 para 12(a); this is at least unclear, and there is no statement that the defendant promised to repay this money.

1. Cheque 799 was signed by the deceased but it appears to have been written in a different hand; it is dated 21 July 2003 and made payable to “Red Line Race Car and Roll Cages” for $4,374.  Mr Axelsen said that this was for an Amcar chassis which the second defendant had bought: p 15.  He said that the deceased may have known about this transaction, he was not a party to that, but he did go with the second defendant to pick up the vehicle.  They were aware of the purchase of the vehicle but were not aware of where the money had come from for it: p 74.  That is inconsistent with the affidavit of the deceased: Exhibit 36 para 12(b).  He conceded that he may have spoken to the vendor on the telephone but denied that he arranged to purchase the vehicle: p 75.  He said that the car was only ever raced once, by the second defendant, when he wrote it off: p 75.

1. Mr Axelsen denied that the vehicle was bought for him, saying that he had no interest in speedway and had never owned a vehicle associated with it: p 12.  The cheque has the name of the second defendant and his phone number written on the back in, according to the first defendant, the handwriting of the deceased: p 141.  She said that she knew that the deceased was going to purchase the car “for him” (in context the second defendant) p 142, although the defence said that the vehicle was being purchased for Mr Axelsen: para 3(d).[12]  The deceased also said this was for the second defendant: Exhibit 36 para 12(b).  I accept that this was a payment for the benefit of the second defendant, but am not persuaded that it was a loan rather than a gift. 

   [12]The first defendant in her 2007 affidavit said it was purchased for the second defendant: Exhibit 29 para 5(c).

1. Cheque 901 was made payable to Brookfield Produce for $517; it was signed by the deceased and appears to be in her handwriting.  Mr Axelsen did not know anything about this cheque: p 15.  He said that he and the deceased went through all the cheques and that anything that was not for them was included in the claim, and that the deceased would have known what it was for: p 16.  There is however nothing about the cheque in the deceased’s affidavit.  There was a receipt from Brookfield Produce for this amount in respect of two items made out to Pettastic: Exhibit 11.  The first defendant said that this was for a water tank that was originally sent to the house of the deceased but then moved to their place because she was estranged from Mr Axelsen at the time: p 142.  She used the business name to get a cheaper price but she wrote out and signed the cheque herself. 

1. Cheque 1006 was payable to Tekfor for $276.73: Exhibit 1.  Mr Axelsen said he did not know anything about the circumstances surrounding this cheque, though it was payable to people who were suppliers of hardware to the business which had passed to the second defendant: p 16.  The first defendant said that this was for a supplier for what Mr Axelsen needed to build his rat cages: p 142.[13]  He denied that this was for payment for requirements for rat cages that he used to build and sell, because this was for too much money: p 34.

   [13]In her affidavit she said it was partly for the second defendant’s use and partly for the deceased: Exhibit 29 para 5(e).

1. Mr Axelsen said that the first defendant used to get the deceased to sign a number of blank cheques at times, and that subsequently she did not fill in the cheque butts correctly: p 15.  He said that the cheque book was kept at the defendant’s premises or at their shop, not at the deceased’s residence: p 10, p 37.  The first defendant on the other hand said that the deceased always had the cheque book, and she had access to it in a practical sense only when she was visiting the deceased.  She put in evidence a set of six cheque butts which had been completed (at least to some extent) by the deceased: Exhibit 18, p 43.  If these were completed by the deceased it appears that she had the habit of writing only sketchy information on the cheque butts: most are undated and some do not state the amount involved.  The deceased said in her affidavit that she gave the first defendant cheques 568, 799, 901 and 1006 made payable as requested by her, so she clearly knew about these transactions and provided the cheques deliberately.[14]

   [14]Exhibit 36 para 12(b), which again contains no reference to any promise or agreement of the defendant  to repay this money.

1. Ultimately in respect of these cheques some were and some may have been for the benefit of the first defendant or the defendants, but there was no evidence that they reflected moneys lent to the first defendant, that is to say that there was ever any agreement on the part of the first defendant to repay the money.  I accept that they were deliberate payments by the deceased, and the proposition that she would make such payments as gifts to her daughter with whom she was then on good terms is plausible.  Because of the relationship between the parties and the presumption of advancement, the onus is on the plaintiff to show that any particular payment was a loan rather than a gift.  That has not been discharged.  This part of the claim therefore fails. 

Loan of $46,000 

1. It appears to be common ground on the pleadings that there was a payment of $46,000  by the deceased to the first defendant on 1 November 2002.  She and Mr Axelsen had borrowed money from the National Australia Bank which was secured by a mortgage on the property of the deceased, and there was a balance outstanding on this account of $44,510.78.[15]  It was alleged in the statement of claim that $46,000 was lent, to be repayable as to the sum of $44,510.78 “by indemnification of the deceased in respect of her liability to the bank for repayment of the outstanding balance” in this account, and the balance of $1,499.22 in cash: para 5.  The defence alleged that the agreement was that the deceased would borrow $44,000 which would be repaid by the first defendant at the rate of $451.80 per fortnight while they were in a position to do so,  the amount actually paid was $46,000, and the sum of $2,000 was paid off the mortgage: para 6.  This repayment was confirmed by the bank statement for the mortgage:  Exhibit 14. 

   [15]Exhibit 14; as of October 2002 the account was in default in respect of the whole balance (Exhibit 13) but thereafter only amounts over $44,000 were treated as beyond the facility limit: Exhibit 31.

1. The evidence of the parties however did not support either of these versions.  There was no reference to this transaction in the affidavit of the deceased: Exhibit 3.  In Exhibit 36 she said she lent $46,000 to the first defendant on the basis that she would be responsible for repaying the whole of the amount outstanding on the mortgage, said to be $44,510.78: para 5.  Mr Axelsen’s evidence about the transaction was vague, and it was not clear that it was given from his personal knowledge of any agreement between the parties.  He said that $44,000 was lent (p 5) on condition that they make all repayments and repay the complete mortgage: p 6.  He said at one point “we were under the impression that Julia was given $44,000 to pay it out and then could redraw 44 out of it, but on checking that never happened” (p 6).[16]  He said that the first defendant signed a direct debit with the bank so that money would be paid directly off the mortgage, and that was consistent with the first defendant’s evidence, although the direct debit form which she signed on 1 November 2002 provided for a fortnightly payment of $250 (Exhibit 15) whereas the statements on the mortgage account show that the fortnightly payments made were initially $450: Exhibit 14, Exhibit 31.

   [16]If that was the intention, it was not reflected in the amount paid by the deceased, or what was done with it.  It would I suppose make sense for the deceased to pay out her debt, but leave the mortgage in place to secure money the first defendant borrowed from the bank, but that is not what happened.

1. His evidence in relation to this transaction was not presented in a coherent manner, but so far as I could piece it together the deceased lent $44,000 to the first defendant, on terms that she would make the payments necessary in order to repay an amount owing by the deceased and Mr Axelsen to the bank, which was secured by a mortgage of the deceased’s land.[17]  No documents in relation to either the mortgage or the loan by the bank were put in evidence.  This was said to be an oral agreement arrived at between the deceased and the first defendant.

   [17]Axelsen p 5-8; p 27-8; p 99.

1. The mortgage was an interest only loan, so that there was no need for regular payments other than interest.[18]  A statement in October 2002 on the account shows that interest was being charged at 6.71 per cent: Exhibit 13.  That document also indicates that at that stage there was no facility limit in place on this account; the whole debit balance was said to exceed the facility limit.  Thereafter it appeared to have a limit of $44,000, but was regularly in default to a small extent:  Exhibit 31.  The bank officer said that in such a situation the bank would have written to the deceased and Mr Axelsen and attempted to ring them: p 117.  This makes it difficult to believe they were unaware of the state of this account.

   [18]Hooper p 116, as long as the loan was under its limit.

1. The first defendant said that the $450 payments continued until 30 January 2004.  There were then payments of $270 on 16 April and 18 May, followed by payments of $100 weekly from 21 May until 29 March 2005, although it seems two payments were missed in February: Exhibit 26.  This list is essentially confirmed by the statement on the account, a copy of which, obtained by Mr Axelsen, is Exhibit 31.  The differences are largely in favour of the second defendant: Exhibit 31 shows three additional payments of $450, on 8 November and 22 November 2002, and on 2 January 2004.  The only other inconsistencies are a couple of minor errors of transcription.  On the other hand, I do not accept that the cash payments recorded at the end of Exhibit 26 as “cash book”, that is payments to the deceased recorded in the cash book of the second defendant’s business, were payments off this loan: p 27.  Many predate the loan, or overlap the regular payments which were made.

1. The first defendant said that this payment of $46,000 from the deceased was really a gift to her, but that she volunteered to make the payments while she could afford to do so: p 32, p 82.  Apart from the fact that this is inconsistent with the original defence of the first defendant (p 82) and the statement (p 81) that the first defendant had said all along that she was paying the $44,000 back, Exhibit 15 which was signed by the first defendant described the periodic payment as “repayment”.  In an affidavit sworn 19 April 2007 the first defendant said that “the amount of $46,000 given to me by the plaintiff was a loan and did not involve any agreement to take on her mortgage liability”: Exhibit 30.  In another affidavit sworn the previous day the first defendant denied asking the deceased for a loan and said “she offered to give me money.  I agreed to borrow from the plaintiff $44,000.  At the time nothing was said as to how said sum was to be repaid.”: Exhibit 29 para 2.

1. Mr Axelsen did not know anything about any agreement between the deceased and the first defendant as to interest on the loan, but said “the only agreement would have been the interest that the bank had at the time”: p 7.  This might have been just a matter of inference on his part.  If the money had been borrowed from the bank by the deceased and Mr Axelsen so that it could be lent to the first defendant, it would be logical to expect some agreement that the first defendant would also pay the interest due to the bank; but the loan from the bank appears to be of long standing.  It was certainly in existence prior to 16 October 2002: Exhibit 13, which is statement no. 33 in respect of this account.[19]  I do not have any documents for the payment of the $46,000 to the first defendant, but it seems to be common ground, at least on the pleadings, that this occurred on or about 1 November 2002.  If so, it could not have come from the flexiplus mortgage account.  The first defendant said that it came from money that the deceased received from her brother’s estate, from her cheque account: p 2.

   [19]But see Hooper p 123.

1. The plaintiff in the statement of claim sought payment from the first defendant in an amount sufficient to discharge the balance payable under the mortgage account, or at least the outstanding balance at a time when the first defendant was said to have repudiated the agreement for loan, $35,958.39.  The statement of claim gives credit for repayments totalling only $10,041.61, but it is clear that far more than that amount has been repaid.  It is apparent from Exhibit 31 that, apart from accruing interest, the mortgage account was subject to various other debits in the forms of withdrawals, transfers to other accounts, (usually the account of the first defendant) and ATM or Eftpos transactions.  The practical effect of this was that the balance in the account remained at or above what appears to have been the facility limit of $44,000.  The first defendant received some of this money, and indeed admitted as much where it was a transfer into her account (p50 – 53) but she did not admit that she was the one who caused the bank to make those payments, or otherwise was the person who made the other debit transactions on the account, and there was no other evidence to that effect before me. 

1. The account was in the name of the deceased and Mr Axelsen, and there was no evidence before me that the first defendant was authorised to operate on this account.  The existence of these additional drawings appears to be fundamentally inconsistent with the notion that she was by regular payments to discharge the indebtedness of the deceased and Mr Axelsen on this account, including interest.  The whole thing is very puzzling, but there is no allegation in the pleadings that the first defendant was responsible for any money which was transferred to her from this account, nor any evidence to that effect, and it must have been transferred by or on the authority of the deceased and Mr Axelsen, presumably as a gift to the first defendant.[20]  In these circumstances, I cannot conclude that the first defendant is responsible for discharging whatever happened to be the balance outstanding on this account at the time of the falling out between the parties.

   [20]Unhelpfully, Mr Axelsen was not asked anything about any of this.

1. There is a further complication.  A lump sum of $10,000 was paid on 9 May 2005 by the first defendant: Exhibit 31.  She said that this was paid pursuant to an arrangement with the deceased under which, if she paid that amount, that would be accepted in full discharge of all of her obligations in relation to this transaction: p 33.  The affidavit of the deceased alleged that this was paid without any agreement, after she had complained that the regular payments had stopped: Exhibit 36.  Mr Axelsen did not know anything about this arrangement though he did seem to be aware that the $10,000 had been paid.  The version of the deceased strikes me as implausible; I think it unlikely that the first defendant would make such a large payment, in a round figure, except as part of a deal of some kind.

1. Ordinarily payment of a lesser sum in discharge of a larger obligation is not conclusive, because no consideration is given for the promise to accept payment of the lesser amount.[21]  However, in circumstances where there is something additional about the payment, such as the timing of it, or where the payment is made to resolve a bona fide dispute between the parties, the agreement to accept the lesser sum will be enforceable.[22]  The first defendant said her relationship with the deceased had broken down by then, (p 134) and I think it likely it had broken down by May 2005.

   [21]Foakes v Beer (1884) 9 App Cas 605.

   [22]Cheshire and Fifoot’s “Law of Contract” (9^th Aust Ed, 2008) # 4.39.

1. The difficulty here however is that it is by no means clear that there was any element of compromise of a dispute involved in any real sense in relation to this payment of $10,000.  The parties had fallen out, but there is nothing in the first defendant’s evidence to indicate that there was at that time any real dispute between them as to these moneys.  The first defendant’s evidence was essentially to the effect that the deceased simply offered that, if the payment of $10,000 was made, that would be the end of the mortgage: p 33.  No prior dispute about repayment was identified.  In these circumstances, I am not persuaded that it has been shown that this arrangement fell outside the ordinary rule that in such circumstances there is no consideration for any promise not to pursue the balance of the debt.  It follows that the first defendant remains liable for the balance outstanding in respect of this loan, although she gets credit for the $10,000 as a repayment.  I find that, from the $46,000 originally lent, she has repaid a total of $31,931.28,[23] leaving a balance of $14,068.72, plus interest.

   [23]Payments of $450 x 33, $100 x 41, $440, $271.28, $270, $10,000, $2,000.

1. In these circumstances it is necessary for me to find what the arrangement was in relation to the loan of $46,000.[24]  I find on the balance of probabilities that it was a loan repayable with interest at a rate corresponding to that charged from time to time by the bank on the loan account, but I do not find that the first defendant was responsible for any of the debits to this account, or for payment out of the account.  It is necessary to calculate the interest by reference to what the balance was from time to time, with any payments credited first to interest.  My calculation of this is $6,099.69 to the end of May 2005, and a further $11,344.73 to the end of November 2012, giving a total owing including interest of $31,513.14.[25]

   [24]This was the amount actually paid; since $2,000 was immediately repaid, it was effectively a loan of $44,000, and that was the figure treated by the bank thereafter as the facility limit: Exhibit 31.

   [25]Interest was calculated at the rate charged by the bank as shown in Exhibit 31, and at 7.5 per cent, essentially the last rate mentioned, since then.

Cheques Misappropriated

1. The cheques, or other payments, in respect of which this was alleged are listed in para 8 of the statement of claim.  Copies of the cheques or other documents relied on are Exhibit 2.  All of these were signed by the first defendant: p 17.  The first defendant said that although she did sign these cheques she did so at the direction or with the knowledge and approval of the deceased, and that some of the payments were made for matters which were not connected with her, or were for the benefit of the deceased.  She had to concede however that there were a number of cheques where she was not able to say how the cheque came about, and many appeared to be payments for the benefit of the defendants.

1. Cheque 555 was a cash cheque for $3,110 dated 4 November 2002; but has written on it in a different hand “for Barry Morris”: Exhibit 11.  The first defendant said that she cashed this cheque at the deceased’s request and gave them the cash for the purchase of a car for Mr Axelsen: p 3, p 74.  He agreed that a Morris was bought for him to restore (p 103) but was not sure that these words were in the deceased’s handwriting, and thought that the timing was wrong for the purchase of the

   
   

   Morris: p 40, p 108.  He thought that there had been a different cheque used to pay for the car; he could not identify the handwriting concerned.  On the whole I accept on the balance of probabilities that this note was by the deceased, and that this money was used for Mr Axelsen’s car.  He accepted that cheque 767, payable to Australia Post for $532.55 (11 June 2003), was for payment of the telephone bill and electricity bill for the deceased and himself: p 44, Exhibit 4, which are the relevant bills and Australia Post receipt for them dated 11 June 2003 for $532.55. 

1. Cheque 565, $1,850 drawn to cash on 11 December 2002, had “Helen car” written on the butt: Exhibit 19.  The first defendant said that this was money used to purchase a car for her sister: p 7.[26]  Mr Axelsen denied this (p 76) saying again that the dates did not correspond: p 77.  He said that he found a different cheque for Helen’s car, but that was not identified at the trial, although this was raised expressly in the defence filed 29 February 2012: para 11(h).  Again I accept on the balance of probabilities that this cheque was cashed for the sister (who is now the plaintiff) to purchase a car.

   [26]The amount was said to reflect the “change over” price after allowing for a trade in.  It seems quite modest.

1. Cheque 676 was written for cash of $6,700, dated 28 January 2003; the butt for this cheque has a reference “roof”: Exhibit 19.  Mr Axelsen said that about $10,000 was spent having work done on their roof by a particular person who liked to be paid in cash: p 79.  He accepted that he had asked the first defendant to get cash from the bank and that she did so and gave it to him, and he used that money to pay the contractor for the work done on the deceased’s roof.[27]  There was no documentation in respect of this payment of $6,700, but the same contractor provided the deceased and Mr Axelsen with a quote for $3,500 for some roof work dated 17 February 2003, and there is what looks like a receipt for that amount from him dated 18 February 2003: Exhibit 9.  Included in para 8 in the statement of claim is a withdrawal in cash of $3,700 on 18^th February 2003 signed by the first defendant: Exhibit 2.  She said that this was for the second payment for the roof: p 10, p 11. (The $200 difference was not directly explained). 

   [27]This confirms that it was the practice for the first defendant to use the account in this way, at that time.

1. Although some bank statements by the deceased were put in evidence, there was no statement covering February 2003, so it was not possible to tell whether there was another payment by the deceased at about this time which could have been the amount of this payment.  On balance however it looks to me probable that the cheque for $6,700 and the withdrawal of $3,700 were essentially to pay for work done on the roof of the deceased’s house, and were therefore not money misappropriated by the first defendant. 

1. Later Mr Axelsen said that the quote and payment related to repairs that the defendants had to their roof, and that, because these were a month after the first payment, they could not be repairs for our roof: p 111.  Plainly however that does not follow; the quotation in Exhibit 9 is addressed to “Barry and Julie Brack”, and the quote is for rust treatment to part of the roof, applying primer on the main roof and then applying top coat.  There is no inconsistency between the earlier payment being for repairs to the roof, and this payment being for painting the roof, and the document suggests that this payment related to the roof on the deceased’s property, not the defendants’ property.  Mr Axelsen’s evidence about these matters was not reliable.

1. There are other matters that were more contentious.  Cheque 878 was for payment of $588 to “Demolishing and Recycling (Aust) Pty Ltd” dated 11 November 2003 and the invoice of that date in that amount, in the name of Knijff Demolitions Pty Ltd, was made out to “J Brack” and indicated that $20 of this was for blinds and $568 for “110 m chamfer”: Exhibit 5.  Mr Axelsen said that those were chamfer boards used on the defendants house, and that all that the deceased had obtained at the demolition yard was some blinds for her house: p 46 – 8.  On the other hand, the first defendant maintained that the cheque was for payment for blinds for the house of the deceased (p 16) and there were no chamfer boards purchased: p 35.  She said the invoice was in the deceased’s name because she was there: p 30. 

1. The invoice clearly indicates that the greater bulk of the payment was for chamfer boards, and in this respect it seems to me that the documentation produced by the first defendant supports the plaintiff’s case at least so far as it indicates that most of the money was for chamfer boards.  On the other hand, the invoice was made out to the deceased.  This may have been just because the payment was on a cheque in the name of the deceased, but on the face of it indicates that the transaction, as far as the demolition yard was concerned, was with the deceased, and that supports the view that whatever was sold by them was sold to the deceased.  The evidence is unsatisfactory, but on balance, I am not persuaded that this represented a misappropriation by the first defendant of the deceased’s money.

1. Cheque 557 for $2,100 on 27 November 2002, was apparently made payable to “Marie [undecipherable] Trust A/c”: Exhibit 2.  The first defendant said that this was a payment of rent for the shed which was used in November 2002 for the defendants to carry on their business, but also for businesses operated by Mr Axelsen: p 7.  He agreed that this was a cheque for rent of the shed, but maintained that all the business conducted in the shed had been handed over to the defendants by then: p 103-4.  The difficulty here is that it may have been the case that the defendants at that stage were to some extent struggling in the business, and the deceased was happy to help at times by making payments to meet various commitments, such as paying for rent and paying suppliers. 

1. At this stage, it does appear the relationship between the deceased and the first defendant was fairly good, and Mr Axelsen said that he and the deceased used to go to the shed and open the business in the morning, and close it in the afternoon, to enable the first defendant to attend to her child who had particular problems: p 12.  He claimed that the payments of $100 which were made by the defendants off the mortgage were payments for this: p 33.  On balance I am not persuaded that this cheque was misappropriated rather than a gift by the deceased.

1. Cheque 709 for $574.51 payable to “A Wood Shed” on 24 March 2003 was said by Mr Axelsen to pay a timber supplier to the business: p 104.  The same applied to cheques 854 and 855, both dated 31 October 2003 for $1,190.53 and $650.80 respectively: p 104.  That there were two cheques to the same payee for quite different amounts on the same day seems odd, but it may have been in payment of two separate bills.  The first defendant said that the cheque 709 was for the purchase of wood, some of which was for Mr Axelsen to use for rat cages: p 11.  She said the same applied to the other two cheques, and could not explain why there were two cheques for the same date: p 14. 

1. Cheque 773 was for $20,000 payable to the first defendant, dated 16 June 2003.  In here affidavit Exhibit 36 the deceased said that this cheque had been paid to the Department of Families and Communities of South Australia, to which she had no reason to be paying money.  This was based on information provided by her bank, which was incorrect; in fact it is clear that this cheque was paid into the first defendant’s bank account: p 63.   She said that the deceased gave her this money to pay contractors to do renovations on their home, after Mr Axelsen was not able to do work he had promised to do for them: p 13.  She was not able to identify any particular payments to contractors in her bank statement in the witness box (p 64) but there could easily have been some delay, perhaps considerable delay, between the payment being made and any work done being paid for, so this is not really suspicious.  On the other hand, it seems quite odd that a sum as large as $20,000 could be taken out of the account of the deceased in June 2003 and no complaint be made about it for almost two years, if in fact it was taken without her knowledge and consent.  It occurred on the same day that an amount of over $118,000 was paid into her account, presumably from the estate of her brother: Exhibit 32. 

1. The first defendant at pp 3-18 went through the remaining cheques listed in the statement of claim as having been misappropriated, and conceded that some of these seemed to be payments for the benefit of the first defendant, or the defendants.[28]  Some of the payments were said to relate to the business premises, which were said to be used by both the defendants and Mr Axelsen,[29] but it seems to me that on the evidence the use that was made of them by Mr Axelsen after the business was essentially handed over to the defendants was minimal.  Payments made in relation to the business premises were therefore essentially payments for the benefit of the defendants.  It does not follow however that they were payments not approved or authorised by the deceased, so that they were in effect gifts to the defendants. 

   [28]For example, cheques 716 (p 11), 748 (p 12), 765 (p 13), 773 (p 13), 776 (p 13), 856 (p 14), 862 (p 16-17), 708 (p 17) and 748 (p 18).

   [29]Cheques 649 (p 7), 557 (p 7), 902 (p 17).

1. In some cases the butts were put in evidence, but in many cases they were not, although it seems that often what was written on the butts was not very informative.  The first defendant could not explain cheques 646, 662, 687, 755, 764, 864 and 716, and the withdrawal slip for $1,300 dated 20 March 2003.  Part of the difficulty no doubt is that all this happened a long time ago.  The transactions referred to in para 8 range from 4 November 2002 to 7 January 2004. 

1. It does seem a little curious that, if the first defendant was misappropriating the money of the deceased in this way, she stopped doing so in early January 2004 even though the parties apparently remained on good terms until early 2005.[30]  On the other hand, if the deceased, having fallen out with the first defendant in early 2005, began for the first time to scrutinise what may well have been fairly sketchy information available from bank statements and cheque butts, it is quite plausible that she would have been then unable to recall a number of these transactions, and to have been disposed to assume that the first defendant had misappropriated them. 

   [30]The first defendant said this occurred after Mr Axelsen struck her: p 133, p 22.  She did not put a date on this.  Mr Axelsen said there was a falling out of some kind about March 2004: p 66.  This was about when the regular payments for the $44,000 loan were reduced, but the relationship must have continued to some extent until 2005.  Perhaps he meant March 2005.

1. Mr Axelsen said that they were not aware of what was going on at the time because the bank statements were coming to the post office box which was in fact being cleared by the first defendant, who was able to and did intercept the statements the bank was sending to the deceased: p 52.  He also said that the cheque book was kept at premises where it was not readily accessible to the deceased: p 37.  On the other hand, there were a number of cheque butts which had the deceased’s writing on them, (Exhibits 16, 18, 19) and some cheques which were written or at least signed by the deceased, which does suggest that she did have access to the cheque book at times.  I am a little wary about this evidence; it is possible that the cheque butts were written up by the deceased later, and it seems clear that at best she did not keep detailed records of the cheques that she wrote.  It does occur to me however that it would have been open to her at any time to have obtained her bank statements, either from the first defendant or from the bank, so that, if the first defendant was misappropriating funds in the way alleged by Mr Axelsen, it was a particularly brazen exercise which relied on the deceased continuing to trust her over an extended period of time. 

1. The reliability of the plaintiff’s case is not helped by the fact that some of the things alleged against the first defendant have been shown clearly to be wrong.  The deceased was not available for cross-examination and Mr Axelsen’s knowledge of the details of the relationship was admittedly incomplete, and may well have been even less complete than he thought.  It is possible as well the deceased was complaining to Mr Axelsen in private about the first defendant while at the same time behaving in a friendly and generous manner towards her.

1. There was also the consideration that there is no evidence that any of these transactions involving the National Bank were ever effected by any authority conferred on the first defendant by the Enduring Power of Attorney granted by the deceased.  The first defendant said that she had been separately made a third party signatory to the defendant’s accounts, that is, a person who was authorised by the deceased to sign cheques on the deceased’s account, and it was pursuant to that authority that she signed various cheques, and at times did other things such as withdrawing funds.[31] The bank officer has said that it would have been necessary for some appropriate procedure to have been followed before the authority conferred by the Enduring Power of Attorney was recognised by the bank,[32] and there is no reason to doubt that evidence. There is no evidence to the contrary. If follows that the provisions of the Powers of Attorney Act 1988 do not apply, and the plaintiff cannot rely on the statutory obligations the Act imposes.[33]  Hence the onus of proof is on the plaintiff.   

   [31]Page 132.  The first defendant terminated this authority herself when the relationship soured: Hooper p 119.

   [32]Hooper p 126-7.

   [33]Indeed, this consideration applies to the other claims where the first defendant signed cheques as well.

1. On the other hand, there are aspects of the first defendant’s evidence which have been shown to be unreliable; the clearest example is the denial that the payment of $46,000 was by way of a loan, notwithstanding that that had been admitted in earlier documents.  On occasions what she said in court was more favourable to her case than what she had said earlier in an affidavit.  The first defendant also appeared at times to be willing to say things because they were helpful to her case rather than necessarily because they were true, although given the limited evidence available this is more a matter of impression than something that can be demonstrated by specific examples.[34]  She said at one point that her relationship with Mr Axelsen had always been bad (p 36), but then that he had been keeping records for the defendants’ business: p 42.  The relationship can not have been particularly bad if they were prepared to trust him to do that, or for that matter if he and the first defendant co-operated in the joint term deposit. 

   [34]She was at times evasive under cross-examination, e.g. p 45, p 49, p 65.

1. It is not the case that I am simply prepared to accept the evidence of the first defendant on the basis that I assessed her as an honest and reliable witness; on the contrary, I am quite wary about her evidence, and I am also conscious of the fact that it is easy enough to make allegations when the other party concerned is not available to contradict them, particularly when what is being alleged is generosity on the part of that person.  Ultimately however much of the plaintiff’s evidence was so weak and defective that I was left in the practical position of preferring the first defendant’s evidence, not because of its great strength, but because of the weakness of the evidence ranged against it. 

1. There was also the consideration that, in relation to the allegation of misappropriation of money from the cheque account, this is an allegation in substance of quite serious wrongdoing on the part of the first defendant.  That is relevant to the question of whether the plaintiff has discharged the onus of proving her case on the balance of probabilities.[35]  At the end of the day, I am not persuaded that any part of the claim in relation to the alleged misappropriation of cheques and other moneys from the bank account of the deceased has been made out. 

[35]Briginshaw v Briginshaw (1938) 60 CLR 336.

Term Deposits

1. It was admitted on the pleadings and not disputed by the first defendant in evidence that on 14 July 2003 she did transfer $10,000 from the deceased’s cheque account (as shown in the entry in Exhibit 20) into a term deposit in the name of the deceased and the first defendant, as shown in Exhibit 33: p 18.  She said that the deceased was present at the time and that this was done with her knowledge and approval.[36]  It was also not disputed that on or about 29 September 2003 $5,000 was withdrawn from the term deposit and transferred to a bank account in the name of the defendants.  On or about 12 November the first defendant closed the term deposit account and transferred the balance into a different term deposit account again in the name of the deceased and the first defendant.  This account in turn was closed in December 2003, and the balance transferred to the defendants’ account.  Again, the first defendant said that all of this was done with the knowledge and agreement of the deceased. 

   [36]Exhibit G to the affidavit of the deceased Exhibit 36 suggests that this term deposit was created on the signature of the first defendant alone, although this was not put to the bank officer in cross-examination, so it is not clearly inconsistent with her evidence.  It may be that the first defendant, as an authorised signatory for the deceased, could sign for both.

1. This is not a matter mentioned in the affidavit of the deceased, Exhibit 36.  Mr Axelsen knew nothing about this: p 23, referring to the letter which was Exhibit JB2 to the affidavit of the deceased, Exhibit 3.  That affidavit said that the letter showed money misappropriated using the cheque book and bankcard had been paid into the account of the defendants, but it shows nothing of the kind.  Accordingly, the defendant’s evidence in relation to this, that these transactions occurred with the authority of the deceased, is uncontradicted, and is therefore accepted.  Accordingly the plaintiff’s claim in respect of these transactions fails.

1. It was further alleged, and not disputed by the defendants in the defence, that on or about 23 March 2004 the first defendant transferred $30,000 from the deceased’s retirement account (Exhibit 8) and used the money to open a term deposit account 56-857-7654 in the name of the first defendant and Mr Axelsen: Exhibits 33, 34.  Mr Axelsen had no recollection that this had occurred (p 36), but accepted that it must have occurred and that he must have known about it at the time: p 37.  That also follows from the evidence of the bank officer, that for the account to be opened in his name he would have had to sign the necessary documents: p 117-8.  There is no suggestion that the first defendant was ever authorised to sign documents on behalf of Mr Axelsen.  That this account was in the name of the first defendant and Mr Axelsen is common ground on the pleadings, and confirmed by the document from the National Bank, Exhibit 34.  It follows that the statement in the letter from the National Bank Exhibit 33, so far as it said that the $30,000 was transferred on 23 March 2004 to an account in the name of the first defendant only, was incorrect.

1. The funds for the $30,000 came from a previous term deposit account 56-708-8584 which matured on 23 March 2004: Exhibit 8.  This account was in the name of the deceased.  Exhibit 8 also shows that on 26 February 2004 a term deposit account 55-077-9573 in the name of the deceased and the first defendant was closed, with a balance before closure of $34,019.89; the same day account 56-708-8584 was opened, in the name of the deceased only.[37] 

   [37]See also Hooper pp 120-1.

1. On or about 7 May 2004 $10,000 was withdrawn from this account, and transferred to the defendant’s account (Exhibit 32); again the defendant said that this was with the approval of the deceased: p 71.  In 21 June 2004 the balance of $20,000 was renewed for a term of 90 days: Exhibit 34.  The same day, however, $10,000 was withdrawn from this account and transferred to the first defendant’s account: Exhibit 32.[38]  Before the renewed term expired, on 25 August 2004, an amount of $10,170.72 was paid into the deceased’s bank account.[39]  It was alleged in the statement of claim that at about September 2004 the first defendant had withdrawn $10,132.38 from the retirement account and “transferred that to the defendant’s account”: para 17.  It is clear however from Exhibit 7, a statement of the deceased’s retirement account from 6 August 2004 until 29 November 2004, that there was no debit in anything like that amount in September 2004, indeed during that period.[40]  Mr Axelsen could not explain this (p 61), and the defendant said that she could not trace any such payment in her bank accounts: p 19.  Although para 17 was admitted in the defence para 13, this appears to have been incorrect.

   [38]That seems on its face inconsistent with what is said in Exhibit 34; unfortunately no-one was asked about this apparently discrepancy.

   [39]Exhibit 7; this is the net effect of two credits from that account and one deduction as an early prepayment adjustment in respect of that account.

   [40]There was a withdrawal of $4,000 on 27 August, but there was no evidence about that transaction.  All other debits were less than $1,000.

1. The deceased in her affidavit Exhibit 36 referred simply to the amount of $30,000 transferred from her savings account on 23 March 2004, and said it was transferred into a term deposit in the name of the first defendant: para 18.  This was presumably just repeating the error contained in the letter from the bank, a copy of which was part of Exhibit G to that affidavit: p 49.

1. Overall therefore the position with these transactions remains unclear.  It does appear that some of the matters which were alleged in the statement of claim and admitted by the defendants in their defence were not correct.  What was said by the deceased in her affidavit was not correct, being apparently based on a letter from the National Bank which was also incorrect.  Mr Axelsen must have authorised the account that was opened partly in his name, and must also have authorised any dispersal of any money out of that account, whether to the first defendant or anyone else.[41]  It has not been shown that money from that account which was transferred back to the account of the deceased was subsequently transferred by the first defendant to her account.  I do not have a clear picture of what happened with this money, but for present purposes it is sufficient to say that I am not persuaded on the balance of probabilities that any of this money was misappropriated by the first defendant.  Indeed, the fact that there was a joint term deposit between the first defendant and Mr Axelsen strongly suggests that as at March 2004 the relationship between the deceased and the first defendant was still quite close.  It follows that the claims in respect of the term deposits also fail.

   [41]Hooper p 127.

Key Card

1. Paragraph 18 of the Statement of Claim alleged that “between 4 December 2004 and 13 January 2005 the first defendant without the deceased’s knowledge or authority used ... the deceased’s key card [to withdraw] amounts totalling $1,784.77 from the deceased’s retirement account.”  This was denied by the defendant: defence para 14.  The defendant’s evidence was that she did not have the use of the key card at all, and it was the deceased or Mr Axelsen who had the key card at the relevant time: p 20.  All that was said by the deceased in her affidavit Exhibit 36 was to deny the allegation by the defendant in her then defence that it was Mr Axelsen who had the key card; she said that the defendant was the only one who used the key card as she was my attorney, and had possession of it “until she returned it in or about January 2005 when a sum of only $39.86 was left in my account.  She had previously not denied having withdrawn the funds from this account.”  This is an awkward way of giving the relevant evidence, but in substance amounts to an assertion that the defendant had possession of the card and had misused it, though the evidence of the deceased did not identify the relevant transactions which would show what amount was recoverable. 

1. Mr Axelsen said the first defendant had the key card for six weeks (p 81), and that the card was provided by the deceased in case the defendants ran out of money: p 82.  Later he said that there was only one card, and it was made available if they needed money: p 84.  It seems to me frankly that the substance of Mr Axelsen’s evidence was that the deceased made the key card available to the first defendant for a period if she needed to use it, and in those circumstances the mere fact that it was used does not show that the transaction was not authorised.  There was no more detailed definition of what she could or could not use it for. 

1. Most of the evidence in relation to this matter was focussed on the question of whether certain transactions which apparently occurred during the relevant period were at places which indicated that it was the defendants, or the deceased and Mr Axelsen, who had access to the card; without going through that in detail, my impression is that the plaintiff had the better of that analysis, but the difficulty remains that on Mr Axlesen’s evidence it was not shown that the defendants were not entitled to make those transactions, assuming they were transactions in fact made by the defendants.[42]  Accordingly this part of the claim also fails. 

   [42]Indeed, Mr Axelsen did not ever identify the transactions said to have been made by the first defendant in this way.  The plaintiff’s case was really hopelessly deficient.

Chattels

1. These are in three categories:  jewellery, tools and antique furniture.  All were said to have come from the estate of the brother of the deceased.[43]  The statement of claim alleged that the deceased became the owner of the jewellery and tools in 2002 which were collected by the first defendant but kept by her.  The defendant in the defence said that the beneficiaries of the estate put the jewellery on a table and five people including the first defendant were allowed to share the jewellery on a pick for pick basis, so that in effect the jewellery the first defendant obtained was a gift from the beneficiaries of the estate, but in any event on 4 April 2005 the jewellery was returned to the deceased’s solicitors by the first defendant’s sister. 

   [43]Axelsen p 71, p 73.

1. All the deceased said in her affidavit was that the defendant was not a beneficiary to the Will and was not entitled to any items, and that the jewellery, furniture and tools referred to in the Statement of Claim had not been returned nor had she received any items from the defendant’s sister: Exhibit 36 para 20.  Mr Axelsen could say little about this: all he knew was that jewellery was left at the defendant’s place because they had a safe: p 13.  He said that he could not be specific about what the jewellery was, just that there were a number of items that were not returned to the sister and one was a ring that the deceased had been particularly keen to get back: p 70. 

1. The first defendant said that the only jewellery she had she gave back: p 24.  She took photographs of the jewellery that she said she obtained and returned (Exhibit 22) and produced a list of items which were collected by her sister to be returned to the deceased on 5 April 2005: Exhibit 24.  There was no evidence from the sister to confirm this.  The deceased had also brought proceedings against the sister to recover some jewellery: Exhibit 25.  The main difficulty with this part of the claim is that there is a distinct lack of proper evidence in the case of the plaintiff as to what the jewellery was, and what its value was.  There is also nothing to show that the first defendant’s account is wrong, and in those circumstances I accept her version and this claim fails.

1. The position is similar with the power tools.  There were photographs of them (Exhibit 23) and they were said to have been also returned: p 25.  They were not included on the list Exhibit 24.  Again there is no evidence from the plaintiff to identify the tools in question or to prove their value.  This claim fails for the same reasons.  In relation to the antique furniture, Mr Axelsen said that there was a hall stand and wardrobes that were lent to the defendants to put in their house extension, and they were never returned: p 13.  There was however no more information about the identity of the furniture concerned, and no evidence of its value.  Mr Axelsen said that the furniture in the brother’s house was divided up between the deceased and her sister on a “pick for pick” basis: p 73.  It was agreed that a Chinese cabinet was given to another member of the family: p 73.  The first defendant said that she had tried to return the furniture, but the plaintiff’s solicitor had refused to accept the return of it, and eventually it was disposed of by her because she could no longer afford storage fees: p 74.

1. Ultimately the problem is that the plaintiff has simply failed to prove her case in relation to the antique furniture.  There is no basis upon which I can give judgment to the plaintiff for any particular amount, or order the return of any particular items.  That part of the claim therefore also fails.

Comment on Submissions

1. The solicitor for the plaintiff was critical of the defendant’s pleading, and submitted that as a consequence there was a deemed admission of a number of the allegations in the statement of claim.  I am not prepared to proceed on this basis.  Apart from the fact that for him to criticise the defendant’s pleading is a case of the pot calling the kettle black, most of this criticisms were overly technical or actually misplaced.  Paragraph 1 of the defence does plead an admission, to paragraph 5 of the amended statement of claim, but this appears to be a mistake as paragraph 6-10 of the defence contain fairly detailed and specific responses to paras 5, 6 and 7 of the amended statement of claim, I suspect this is left over from a pleading to an earlier version of the statement of claim, para 5 of which merely alleged a particular balance in the mortgage account on a particular date. 

1. What was said in relation to para 1 of the statement of claim, looked at in a practical sense, was responsive to the allegation therein, pleading a version of what was alleged to have occurred on about the date specified which is quite inconsistent with the plaintiff’s version.  It therefore achieved in a practical sense what was required by the rules.  The submission in relation to the response to para 8 of the amended statement of claim was by reference to the first version of the defence, which has since been amended, and which now admits that the amount alleged was withdrawn from the bank account of the deceased.  The pleading goes on to give details of what was said to be the true position in relation to a number of these payments, or, where the first defendant could not recall a particular payment, alleged in effect that they were made on the instructions of the deceased. 

1. As I have indicated in the analysis in this judgment, there were even some admissions made in relation to term deposits which were not factually correct; in that situation, if I have evidence which demonstrates that a fact alleged and admitted was not correct, I am going to act on the true facts.  In the same way, it was sometimes the case that neither the plaintiff’s allegation nor the defendant’s response was proved, but the effect of the evidence was either to prove that the true situation was something different from both allegations, in which case I have accepted what I have found to be the true situation, or that on the state of the evidence only a limited finding could be made, or that the plaintiff had failed to prove her case.  Generally speaking, my impression of the defendants’ pleading is that it gave a good practical indication of the defendants’ case in relation to the various allegations, and I am not prepared to deal with the matter on the basis of any technical failure to comply with the pleading rules.

1. Apart from this, the submissions at times referred to matters which were not the subject of evidence:  in paragraph 7 it was submitted that the evidence was that the defendant used the redraw facility to keep taking money out of the mortgage account, but there was no evidence of that, or indeed evidence that the defendant received the benefit of any of the monies except where they had been shown to have been transferred into her bank account by Exhibit 31. (The submissions went on to allege that the first defendant was responsible for paying these amounts, something not claimed in the action.)  Paragraph 8 referred to “the records of the Transport Department that no car was registered in the plaintiff’s name after the date of the cheque”, which are not in evidence.  A search was said to be exhibited to an affidavit, which was not in evidence in the trial.  It was also submitted in para 10 that the antique furniture had a particular value, of which there was no evidence.

Conclusion

1. It follows that the only part of the plaintiff’s claim that has been successful has been the claim for repayment of the loan brought against the first defendant, in respect of which the plaintiff is entitled to recover an amount of $31,513.14, including $17,444.42 by way of interest.  The remaining claims against the first defendant, and all of the claims brought against the second defendant, are dismissed. 

1. The amount that is recoverable from the first defendant is recoverable on the basis that it was money lent by the deceased to the first defendant and not repaid, together with interest.  This does not give rise to any entitlement to equitable relief, and does not provide any basis for relief by way of constructive trust in respect of the property formerly owned by the second defendant, and now represented by the balance of the sale price of that property which was paid into the plaintiff’s solicitor’s trust account pursuant to orders made some time ago.  I am not prepared to declare that any part of that amount is held under a constructive trust for the plaintiff.  In these circumstances that money must be refunded, and it should be refunded to the second defendant, subject to any claim on the part of the applicant, about which I am prepared to hear submissions.

1. With regard to the question of costs, I will hear submissions when these reasons are delivered, in case any relevant offers to settle have been made.