Windemac Pte Ltd v Jada Ex Beverages Pty Ltd and Ors
[2012] VSC 559
•23 November 2012
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMERCIAL AND EQUITY DIVISION
No 00843 of 2012
| WINDEMAC PTE LTD | Plaintiff |
| v | |
| JADA EX BEVERAGES PTY LTD & ORS | Defendants |
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JUDGE: | SIFRIS J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 23-25 October 2012, 8 November 2012 | |
DATE OF JUDGMENT: | 23 November 2012 | |
CASE MAY BE CITED AS: | Windemac Pte Ltd v Jada Ex Beverages Pty Ltd & Ors | |
MEDIUM NEUTRAL CITATION: | [2012] VSC 559 | |
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CONTRACT – Joint Venture Agreement – Whether agreement concluded – Terms of the agreement – Whether plaintiff has any equitable interest in property
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr T J Scotter | DLA Piper |
| For the Defendants | Mr A Schlicht | Venizelakos Lawyers and Notaries |
HIS HONOUR:
Introduction
JPG Investments Pty Ltd (“JPG”) owns a warehouse situated at 6 Malcolm Court, Kealba (“The Warehouse”).[1]
[1]The Warehouse is more fully described in Certificate of Title Volume 10122 Folio 739.
Windemac Pte Ltd (“Windemac”) is a company incorporated in Singapore. It claims that it has a two-third interest in the Warehouse arising out of a joint venture agreement.
Windemac alleges that in 2006 it[2] entered into a joint venture agreement with Jada Ex Beverages Pty Ltd (“Jada”) to purchase the Warehouse on the basis that Windemac would have a two-thirds interest and Jada a one-third interest. A new company would be incorporated to hold the asset.
[2]Windemac was only incorporated after settlement of the Warehouse. Prior to incorporation Johnny Song Hock Kee traded as Windemac. There is no dispute that upon incorporation Windemac became entitled to the benefit of the joint venture agreement.
The new company, JPG was incorporated and owns the Warehouse, however both JPG and Jada deny that Windemac has any interest as alleged. They contend that whatever the content and terms of the joint venture agreement, Windemac was required to, but made no contribution whatsoever to the acquisition of the Warehouse and accordingly has no interest.
Windemac admits that it made no direct contribution to the purchase price and acquisition costs of the Warehouse but contends that pursuant to the joint venture agreement:
(a)part of the amount owing by Jada to Windemac for the purchase of beer ($312,000) was to be used to fund the acquisition. This would give Windemac a one-third interest in the Warehouse.
(b)it agreed that it would be liable for one-half of the amount borrowed from Westpac Banking Corporation (“Westpac”) to fund the acquisition. This would give Windemac a further one-third interest in the Warehouse.
JPG and Jada contend that the joint venture agreement did not contain the terms referred to. Windemac was required to make an actual contribution and it failed to do so. Further, they contend that even on Windemac’s own case not only was no credit given or adjustment made by Windemac in favour of Jada to reflect the alleged contribution of $312,000, but Windemac has sued for the amount alleged to comprise its contribution ($312,000) both in this case and in a separate proceeding in Singapore. They contend further and it is common ground that neither Windemac nor its director Johnny Song Hock Kee (“Johnny”) has any liability to Westpac.
The trading relationship between the parties commenced in about 2005. At that time Johnny traded as Windemac. He sold beer on consignment to Jada. Sharon Renee Bryar “(Sharon”) was and remains Jada’s sole director. Sharon is also the sole director of JPG. George Exadactylos (“George”) is and was at all relevant times the domestic partner of Sharon. During the entire relevant period he was a bankrupt, however it appears that all relevant negotiations were conducted by George on behalf of Jada. The only relevant change in the trading relationship was the incorporation of Windemac on 29 September 2006.
The trading relationship has had its ups and downs. Windemac complains of persistent late payments and non-payment. Jada has a range of complaints including the accuracy of the alleged amount owing to Windemac. These matters are the subject of the proceeding in Singapore.
The main issue to be decided in this case is whether there was a joint venture agreement between Jada and Windemac and more particularly, whether the agreement contained the terms contended for by Windemac. If not, that is probably the end of the matter and the claim will be dismissed.[3] If such agreement is established it will be necessary to consider the appropriate form of relief.
[3]Windemac has made an alternative claim for repayment of a loan of $300,000. The claim is not for goods sold and delivered the subject of the Singapore proceeding.
Windemac wants the Warehouse to be sold. It contends that the joint venture agreement gave rise to fiduciary duties on the part of Jada and JPG and that they breached such duties to the knowledge of and with the participation of Sharon and George and that accordingly, equitable relief should be granted.
Joint Venture Agreement
It is more likely than not that the parties reached agreement substantially along the lines submitted by Windemac. The documentary evidence and admissions made by Jada and JPG overwhelmingly support such a conclusion. The more difficult question is not whether Windemac has an interest but rather the extent of the interest. Is it one-third or two-thirds?
It is necessary to refer to the evidence in some detail. I was not impressed by the oral evidence of each of Johnny, George and Sharon[4] and propose to have primary regard to the written documents comprising of the main relevant correspondence between the parties.
[4]It should be noted that despite more than one court order to such effect, George and Sharon did not file and serve any witness statement or outline of evidence and gave evidence after Johnny was cross-examined. They remained in court during such cross-examination.
The Evidence
Johnny gave evidence that in early 2006 he had two telephone conversations with George in relation to the acquisition of a warehouse. George said that a warehouse would cost about $900,000 of which a bank loan could fund about $600,000 but a further $300,000 was required. Johnny said that Mr Ah Hong Peter (“Ah Hong”), a friend of his would contribute or invest the sum of $300,000 and that each of Johnny and George would share the bank loan, the result being that each of Ah Hong, Johnny and George or entities associated with them, would have a one-third interest in the warehouse. According to Johnny, both Ah Hong and George were happy with this arrangement.
It is relevant to note at this stage (and it is common ground) that Ah Hong had previously invested about $300,000 in Windemac’s business. What is not agreed by Ah Hong is that he was interested in investing in Australia or that he wanted to become a permanent resident of Australia, matters that Johnny says he conveyed to George. Further, George does not agree with the manner in which Windemac would acquire its one-third interest as referred to above. The defendants case is that Windemac was required to contribute $300,000.
On 15 May 2006, Johnny sent a letter to Sharon thanking her for the section 32 statement for the proposed acquisition of the Warehouse. Johnny advised that Windemac was in a position to offer an amount equal to thirty per cent of the contract price and valuation and was prepared to finance a deposit of approximately $250,000 to $300,000. Johnny indicated that Windemac wanted the Warehouse to be purchased in the name of a new company that would lease the Warehouse to Jada.
Johnny gave evidence that before signing the letter of 15 May 2006, George told him that an amount was owing to the landlord for rent and that he had problems that would be solved by buying the Warehouse. George said that he wanted to assure the landlord that he was serious about buying the Warehouse and that a letter from Johnny saying that he, that is Johnny, wished to invest would be of great assistance and would prevent the landlord selling to another party. George admits that he asked Johnny to provide the letter.
Johnny says that a few days later he received by fax, the letter of 15 May 2006 and he signed it and sent it back. He says that he does not remember receiving any Section 32 statement and at that time, did not know what it was.
On 16 May 2006, JPG was registered. According to Johnny, George told him of the registration of the new company and said that it represented Johnny, Peter and George and that it would purchase the Warehouse. There is remarkably no relevant correspondence between the parties until 2 November 2006.
The contract of sale for the Warehouse was executed on 1 June 2006 and the 10% deposit (and all other costs not funded from the Westpac loan or by vendor financing that was ultimately obtained) was paid by Jada from its account. Jada had only one trading account and all receipts and payments were made into and from this account. George says that he told Johnny that they were going ahead with the purchase and Johnny replied that he would organise his share of the money. Johnny denies this.
During this time, George says that he was regularly asking Johnny for his share of the purchase price as the settlement was to take place three months after the contract of sale, but he never received it. Johnny denies this.
Around 12 August 2006, Johnny says that George asked him to transfer $100,000 to pay for the deposit for the Warehouse. Johnny says he provided these funds on behalf of Ah Hong, that is by using the money Ah Hong had invested in Windemac. Johnny was not aware that the deposit had already been paid in June when the contract was signed.
The $100,000 was sent via an account in Sydney. Johnny says it was sent via a money changer and not direct from bank to bank to avoid fees and because George needed the money urgently.
George disagrees that he asked for this money as a deposit, and says that it was a loan from Ah Hong that arose when Johnny’s investor pulled out of the joint venture, as discussed below.
In late August 2006, Johnny says he told George that Ah Hong was no longer interested in investing money in the Warehouse. He says that he asked George to repay the $100,000 he had transferred to George. According to Johnny, Ah Hong told him at this time that he had suffered huge losses in some of his other businesses and wanted his $300,000 back from Windemac. He also said that he was no longer interested in investing in the Warehouse.
Upon being told that returning the $100,000 would jeopardize the purchase of the Warehouse and that this would mean losing the deposit, Johnny says he spoke to George and agreed that Windemac would take over Ah Hong’s $300,000 contribution towards the Warehouse. The $300,000 would be paid by using the money Jada would have remitted back to Windemac following sales of beer. Johnny said that this proposal, which George agreed to, in combination with the bank loan arrangement which they had discussed, further entitled him to two out of the three shares in the Warehouse. George says that he did not agree to this arrangement.
As at this point in time, Jada owed Windemac $611,855.75[5] and there is no indication in any of the documents that the sum of $300,000 was deducted from the amount owing by Jada to Windemac. Johnny says the amount of $300,000 was never deducted from the accounts as George never advised him of which invoice it should be deducted. Johnny agrees that he never paid the $312,000 directly. [6]
[5]Although the amount is disputed by Jada and other matters are raised in the Singapore Proceeding, it is more likely than not that at least $312,000 was owing by Jada to Windemac and this amount was specifically used by the parties and accepted as being owing and capable of being the subject of the contribution by Windemac as I have found.
[6]The original discussions between the parties related to a proposed contribution of $300,000 by each investor. As events unfolded in relation to the funding of the Warehouse, it became clear, as the correspondence indicates, that the amount required in respect of the one third interest was $312,000.
So far as the bank loan is concerned, Johnny gave evidence that during this telephone conversation he confirmed that the bank arrangement would not change. He says that George agreed and said that the rental that Windemac would be entitled to (as part owner of the Warehouse) would be used to pay Windemac’s share of the bank loan. Johnny says that he agreed to this arrangement. Johnny says that the repayments on the loan were to be $3900 per month, his one half share of this amount would be covered by this two-thirds interest in the approximately $3000 of rent Jada was paying each month. George disagrees that he suggested Johnny use rental receipts to pay for his portion of the mortgage repayments. George also says that the monthly loan repayments were always $5500.
George agrees that Johnny called him around this time (late August 2006) and discussed the investor backing out. However, according to George, it was a Mr Pua and not Ah Hong[7] who had decided to withdraw from the investment due to his gambling losses. In evidence-in-chief, George agreed that he told Johnny the deposit would be at risk if the investor pulled out, however during cross-examination he denied this was the case. George says that at this time Johnny also said that Ah Hong was willing to loan $100,000 to purchase the warehouse with interest to be paid at 2% per month. George said he agreed to this loan. George says that he paid off Ah Hong’s loan in five instalments ending in October. The loan was repaid from Jada’s account.
[7]The first time the defendants made any reference to Mr Pua was in the defence to the amended statement of claim dated 2 November 2012 (paragraphs 9 and 10).
An undated Particulars of Sale document was faxed to Johnny on 25 August 2006 which named JPG as the purchaser of the Warehouse. The purchase price is specified as $765,000 with a deposit of $76,500.
On 23 August 2006, JPG entered into a Business Finance Agreement with Westpac for $535,000.00. The agreement includes personal guarantees from Sharon and Jada.
On 6 September 2006, Ms Gilchrist of Westpac sent a letter to Sharon advising that settlement had taken place that day and that in accordance with the instructions, $660,575.37 was handed over. The letter provides that the $660,575.37 comprised of:
“Business Development Loan 033000 730979 $535,000.00
033080 387065 $125,575.37.”
The Vendor provided finance in the sum of $40,000 for JPG’s investment in the Warehouse.
Johnny says that George called him in October and told him that the Warehouse had been purchased using $312,000 from the sales of beer and a loan for the remainder of the purchase price.
On 2 November 2006, Johnny sent a fax to Jada addressed to Sharon. Johnny states that as at 13 October 2006, $345,051.58 was outstanding and owing to Windemac and that since $312,000 AUD was paid with his funds for the Warehouse, he will take it that he has paid that amount for the Warehouse. Johnny then stated that he would deduct the interest of 2% from the outstanding $345,051.58 and would only bill the 2% interest for the remaining $33,051.58 AUD that was overdue. Johnny concluded the fax by stating:
“This mean that I have paid on behalf of another investor whom opt out to buy the warehouse as originally plan. Our warehouse is now 70% owned by me and 30% owned by you.”
On 2 November 2006, Mr David Ng (“Ng”), Windemac’s lawyer emailed George requesting copies of the company searches for JPG and Jada, the Sales and Purchase Agreement for the Warehouse and the certificate of title and lease agreement.
Sharon replied to the email the next day stating that a copy of the certificate of incorporation for JPG would be faxed to him as well as the sales agreement and a bank statement showing the stamp duty that was paid. Sharon also stated that Jada was not relevant and was a distinct entity that only has a lease with JPG.
On 2 November 2006, Sharon sent an email to Johnny stating:
“I understand from your fax that you contributed $312,000 to the warehouse and I have taken a loan of $535,000 secured by me. Could you advise me where the $312,000 derived from. I do understand that $100,000 arrived from Sydney, I also understand that I borrowed $100,000 from Ah Hong and that’s why I am paying the interest. Please show me the deductions on the statement as I can not see where and how this money was deducted.”
The email also states that Jada has paid the rent and added the difference to meet the monthly payment to Westpac. Sharon ended the email as follows:
“part of the rent Johnny is your money for the $312,000 contribution”.
On 2 November 2006, Johnny replied to Sharon’s email stating that the amount of “AUD $312,000 arrived from George” and asked that they let him know the exact amount that ‘we’ paid for the Warehouse and that if it is less than AUD $312,000, he will have to increase the interest for the outstanding. George admits receiving the email and making some notes on the email at the time. Item 1 of the notes is in the following terms: “Agree 312”.
Shortly after, on the same day, Johnny sent another email stating that his lawyers would work out the details and that it would be:
“warehouse value example AUD 900,000
Divided by equal shares: example 3 person
than it will be AUD 300,000 each.
Since originally me and George suppose to pay for the bank loan example AUD 3900 than means divided by 2 person each will be AUD 1950 each.
Than rental example evaluate at AUD 3,000 per month it should be divided by 3 person meaning AUD 1,000 each
So if I take 2 shares I have to pay take AUD 2,000 of rental and the rental I received will be taken to pay for the instalment of AUD 1,950.“
On 8 November 2006, Johnny sent a fax to Sharon at Jada confirming that Ah Hong’s $100,000 was paid in five instalments.
On 10 November 2006, Johnny sent a letter (or fax) to Jada setting out the interest carried forward and outstanding as at 13 October 2006. Johnny states that as AUD 312,000 was used for the payment of the Warehouse no interest had been charged.
On 11 November 2006, Ng sent a follow up email seeking the documents from Sharon.
On the same day, Jada (there is no signoff on the email) replied to Ng stating that all of the documents including the Warehouse loan statements and valuations had been faxed to Johnny. The email also states that Jada will not be engaging a solicitor for the matter. The email also provides that the difference between the loan and the total cost was $312,000 AUD. Specifically, the email provides:
“We are tired of explaining these figures.
Purchase Price 765,000
Stamp Duty 42,000
Total 807,000
Legal $6500
Valuation $1200
Bank establishment Fee $3000
Broker etc
Total $817
Renovation, Security, Insurance,
Rates, Yards, Offices, Etc $30,000
Total 847,000
Have secured loan on my name for this warehouse for $535,000
The Balance is $312,000.”
In late November, Johnny says he called George asking for the title deed to the Warehouse. Johnny says he had previously indicated to George that he wanted Windemac’s name on the Warehouse’s title deed. Johnny said George told him that only JPG’s name was on the title due to tax reasons. Johnny says that George confirmed to him on the phone many times that Windemac owned 70% of the warehouse. George disagrees that Johnny requested the title deed.
Johnny said he then asked for a letter from JPG regarding Windemac’s interest in the property as a form of insurance to show his ownership in the property. According to Johnny, George said that he would get Sharon to provide such a letter. This was allegedly provided on 1 December 2006. Johnny says that he received the original letter by hand (in person) or by courier.
This letter is most significant. It is the key document in the case and evidences and confirms the interest of Windemac.
On 1 December 2006, Sharon sent a signed letter to Johnny (“the Admission Letter”) which provides:
“I Sharon Renee Bryar Director of JPG Investments A.C.N 119 716 193 Acknowledge the equity share to Mr Johnny Song Director of Windemac Pte Ltd To be to the value of aud $312,000.”
The provenance of this letter is a matter of some dispute.
George says that he received unsigned copies of this letter on at least three occasions from Johnny. He says that he ignored them each time and disposed of the letters. Johnny disagrees that he had sent unsigned versions of the letter to George.
Sharon, the purported signer of the letter, denies having signed it. When questioned in relation to whether it was her signature on the document, she eventually agreed it was her signature but denies having put it on the document. Sharon says that upon finding out about the letter, at a mediation in these proceedings, she was very upset, regarded the letter as fraudulent and instructed her lawyers to take appropriate action but otherwise did nothing herself.
On 24 February 2007, Johnny sent an email to Sharon and George for the purpose of explaining “our main funding problem”. Johnny proposed that a smaller warehouse be purchased and that:
“we can utilise it to the fullest as we are now using bank loan instead of initial proposal of AH HONG’s money to pay for the downpayment of the warehouse. The funds I paid AUD 312,000 would be very helpful for buying stocks instead of being paid for the downpayment and the funds cannot be utilised at all. Only hoping for a good return when we sell the warehouse in the future.”
On 13 May 2007, Johnny sent an email or fax to George setting out invoices that were due. Johnny states that the outstanding amount is “AUD878,1400 – aud 312,000 (for the w/house)”.
On 12 January 2010, Windemac sent a letter to the Income Tax Comptroller of Singapore stating that its equity share in the Warehouse in Melbourne was to the value of AUD 312,000 being the approximate equivalent of $368,000 Singapore dollars. In the letter, Windemac included a copy of the Admission Letter. This value (namely $368,000 Singapore dollars) is also stated in Windemac’s Directors’ Report and Finance Statements for the Financial Year ending 30 September 2007 (“Financial Statements”).
On 12 January 2012, Solicitors for Johnny, DLA Piper lodged a caveat over the Warehouse claiming an equitable interest in the fee simple. The Caveator claims that the registered proprietor holds its interest in the land as trustee for the Caveator pursuant to a constructive trust.
Analysis
In my opinion, it is more likely than not that the presumed intention of the parties, from their external manifestations, was that Windemac would have an interest in the Warehouse. The discussions and correspondence is sufficient to establish such an interest. This is despite the unsatisfactory nature of the oral evidence, some vagueness and ambiguity in the correspondence and some unexplained and peculiar matters.
The Admission Letter is singular and conclusive. It is the clearest and best evidence of the antecedent concluded intention and agreement of the parties. It effectively and unequivocally admits that Windemac has an equity interest in the Warehouse. It was not seriously suggested that any other meaning could be given to the words. Rather, it was submitted that although Sharon could not and did not dispute her signature she did not sign the letter. Further it was faintly submitted that the equity share was contemplated and would arise upon Windemac making its direct contribution. I reject the submission.
I do not accept that Sharon did not sign the Admission Letter. It is her signature and no plausible explanation was given as to how her signature appeared on the letter. Fraudulent conduct was not suggested nor does the evidence establish any such conduct. Nothing was put to Johnny in this regard.
The second point has no merit. The Admission Letter records an existing interest and not a contemplated interest. I do not accept George’s evidence that he did not regard the Admission Letter as an important document and threw previous drafts in the rubbish bin.
The Admission Letter is also consistent with the discussions and documentation that preceded it. Windemac repeatedly and consistently asserted that it had an interest in the Warehouse and these clear and unequivocal assertions were not rejected or contradicted. They establish the relevant interest arising out of the joint venture agreement.
Although it was always intended that Windemac would have an interest in the Warehouse, the extent of the interest changed. In the end, I am satisfied that the joint venture agreement as it unfolded and in its final agreed form, provided for an interest in favour of Windemac to the extent of one-third of the Warehouse. I reject Windemac’s submission that it was entitled to and the joint venture agreement provided for, a further one-third equity interest in the Warehouse.
Originally, it was contemplated that three parties would participate in the investment. An investor would make a contribution of one-third and each of Johnny/Windemac and George/Jada would share liability for a bank loan and this would give them each a one-third share.
This original proposal would not require Windemac to contribute any funds or forgo payment of part of the amount owing by Jada. The one-third interest would arise simply by being liable together with Jada for the bank debt.
As it happened the third party investor[8] decided not to make the investment and it was at this stage, about late August 2006 that Windemac offered to take over the proposed contribution to be made by the third party. George agreed.
[8]There was much debate about the identity of the proposed third party investor. This is another curious aspect of the case. In my view it is not necessary to resolve this issue.
The agreement to take over this one-third interest by agreeing to reduce the indebtedness of Jada to Windemac is contained in and evidenced by the correspondence of 2 November 2006, 10 November 2006, 11 November 2006 and most importantly, the Admission Letter. The correspondence clearly asserts at the very least a one-third interest and there is no correspondence that corrects or questions this position. To the limited extent that George and Sharon gave evidence that they challenged the position in telephone discussions, I do not accept that evidence. It is inconsistent with the correspondence and the Admission Letter and it is more likely than not that no such discussions took place. Further, George says that he was very angry when he received the letter or fax of 2 November 2006 (para 34 above). It is inconceivable that he did not respond in writing to such a serious allegation if he thought it to be untrue. The same may be said about the later correspondence.
Jada and JPG placed great reliance on the fact that Windemac did not in fact reduce the indebtedness of Jada by $312,000 as it agreed to do by way of its contribution pursuant to the joint venture agreement. Moreover, not only did it not reduce the indebtedness but it has included the amount in the claim made in the Singapore proceeding and as noted earlier, in this proceeding.
The failure to reduce the indebtedness of Jada to Windemac is peculiar and curious and I do not accept the explanation given by Johnny, namely that he did not know which invoice to debit.
Although in many respects strange, I do not accept that the failure to reduce the indebtedness of Jada to Windemac by $312,000 is sufficient to detract from the interest that it has. No doubt it is a factor that militates against a conclusion that there was a joint venture agreement along the lines contended for by Windemac. However, looking at the evidence as a whole and for the reasons given I find that a joint venture agreement was concluded in relation to Windemac’s one-third interest. The consequence is that the amount of $312,000 is not recoverable from Jada and it is probably irrelevant that the accounting records have not, albeit deliberately, kept up with the reality. Either the amount is owing or it is not and the failure to reduce the amount is not entirely to the point.
I am not persuaded or satisfied on the evidence that Windemac is entitled to more than a one-third interest. Windemac may well have assumed that its previous offer to share the bank debt, and in respect of which it would obtain a one-third interest would carry over and continue to be the position after the third party investor backed out and it agreed to in effect be substituted, resulting in it having a two-thirds interest. However any assumption to such effect is not adequately or sufficiently based on any agreement or representation made by or on behalf of Jada or JPG.
The matter is not free from doubt. However on balance, I am inclined to the view that despite some reference to the Westpac loan and income (rent by Jada) and expenditure (mortgage payments) in relation thereto, (particularly in the context of the respective interests of the parties) it is more probable than not that the required consensus was not reached in relation to this additional asserted interest. The matters set out below are relevant.
First, the Admission Letter does not make any admission beyond a one-third interest.
Second, the overwhelming emphasis in the documents referred to is an interest to the extent of and commensurate with the sum of $312,000.
The assertion in the fax of 2 November 2006, that Windemac had a 70% interest (para 34 above) and the email sent by Johnny on the same day (para 40 above) referring to the original position with regard to the bank loan and concluding that he has a two-thirds interest, are probably not sufficient to create the asserted interest. Other than on 2 November 2006, there is no further written reference to this aspect. On the same day, in an email, Sharon specifically links the rent to the $312,000 contribution, a position inconsistent with the basis for the two-thirds interest submitted by Windemac.
Third, neither Windemac nor Johnny has any liability in relation to the Westpac loan. They have had no involvement in any aspect of the loan. The answer suggested was that as between the parties, that is Windemac and Jada, there is equal liability. Although this may have been the intention of the parties at the stage that there was a third party interest, there is no evidence, either written or oral, to the effect that it was specifically agreed that the previous position would remain. In fact the evidence points to no such discussion. The references in the fax and email of 2 November 2006 were assertions without any adequate contractual foundation. In fact, as pointed out, there is no evidence of any discussion at all after the third party investor backed out.
Fourth, in its letter to the Income Tax Comptroller (para 54) Windemac stated that its interest in the Warehouse was to the value of $312,000.
Fifth, in its Financial Statements, Windemac records its interest in the Warehouse at $368,000 Singapore dollars.[9]
[9]The Financial Statements include an opinion by the directors that the Financial Statements ‘are drawn up so as to give a true and fair view of the state of affairs of [Windemac] as at 30 September 2007’. The Statement is signed by Johnny as director.
Accordingly, having carefully considered all of the evidence I am of the opinion that Windemac has established an interest in the Warehouse only to the extent of one-third.
It follows that it is not necessary to deal with the alternative claims made by Windemac.
Relief
Windemac is entitled to a declaration to the effect that it has a one-third interest in the Warehouse being the property more fully described in Certificate of Title Volume 10122 Folio 739.
At this stage, and although the matter was argued, I do not propose to deal with the precise form of relief against the various parties and whether the Warehouse should be sold. I will give the parties an opportunity to resolve the matter in light of these reasons.
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