Wylie v Orchard (No 2) - [2020] QDC 315

DISTRICT COURT OF QUEENSLAND

CITATION:

Wylie v Orchard (No 2) [2020] QDC 315

PARTIES:

LYNETTE MARGARET WYLIE
(Plaintiff)

V

ELIZABETH MARGARET ORCHARD
(Defendant)

FILE NO/S:

2848/17

DIVISION:

Civil

PROCEEDING:

Trial

ORIGINATING COURT:

District Court at Brisbane

DELIVERED ON:

11 December 2020

DELIVERED AT:

Brisbane

HEARING DATE:

14 – 16 September 2020

JUDGE:

Porter QC DCJ

ORDER:

1.   Judgment be entered for the Plaintiff for $150,500.

2.   I will hear the parties as to interest and costs.

CATCHWORDS:

CONTRACT — BREACH OF CONTRACT — PERFORMANCE OF CONTRACT – claim in debt under a loan agreement – where the plaintiff entered into a loan agreement with the defendant – where the loan agreement provided that the plaintiff was to advance $100,000 to the defendant to purchase a “franchise from REFUND home loans” – where the loan agreement purported to give the defendant “full discretion as to how Loan funds are dispersed in order to achieve mutually beneficial objectives and provide ongoing employment opportunities for both parties” – where the loan was fixed for three years at which point the capital and interest was due and payable to the plaintiff – where the loan agreement required the defendant to pay the plaintiff 15% interest per annum – where it is uncontentious that the plaintiff advanced $100,000 to the defendant by way of bank cheque – where the defendant subsequently disbursed those funds to third parties – whether this on proper construction of the loan agreement comprised repayment of the debt – whether the plaintiff repudiated the contract by demanding repayment of the principal before its due date – whether the defendant is in breach of the terms of the loan agreement – whether the claim is statute barred

CONTRACT – FRAUDULENT MISREPRESENTATION – claim in deceit – where the plaintiff alleges the defendant induced the plaintiff to enter into the loan agreement and to lend the principal to the defendant by fraudulent misrepresentation as to how the defendant she intended to use the advance – where the plaintiff alleges that at the time of obtaining and bank cheque and entering into the loan agreement, the defendant never had the intention of applying the money for the purpose according to the loan agreement –   – whether the plaintiff relied on the alleged misrepresentation – where the plaintiff does not give direct evidence of reliance – where the defendant contends that the loss was caused not by fraudulent misrepresentation but either the plaintiff’s repudiation of the contract or failure to pursue relevant person/s – whether the deceit claim is in any event statute barred

EQUITY — EQUITABLE REMEDIES — MISREPRESEN TATIONS — INDUCEMENT – claim for breach of trust – where the plaintiff claims a constructive trust arose over money advanced under a loan agreement induced by fraudulent misrepresentation – where the plaintiff contends the constructive trust was breached by payment out of the money other than for the plaintiff’s benefit – where the loan agreement was not rescinded for fraudulent misrepresentation – whether the…

Grounds of appeal

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

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

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

Consideration

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

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

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Details

Case: [2020] QDC 315
Decision Date: 11 December 2020

CaseChat Overview and Summary

Wylie v Orchard (No 2) involved a dispute between the plaintiff, Wylie, and the defendant, Orchard, regarding a loan agreement. Wylie alleged that Orchard breached the loan agreement by misapplying the funds and fraudulently misrepresenting the intended use of the loan. Wylie sought repayment of the principal and interest, damages for deceit, and a constructive trust over the money. Orchard contended that Wylie repudiated the contract, failed to pursue relevant parties, and that the claims were statute-barred. The court had to determine whether Orchard breached the loan agreement, whether the deceit claim was statute-barred, whether a constructive trust arose, and whether the claims were subject to limitation periods.

The court found that Orchard breached the loan agreement by misapplying the funds, as the agreement specified that the money was to be used to purchase a franchise from REFUND Home Loans. The court also held that the deceit claim was not statute-barred, as the plaintiff did not discover the fraud until within the six-year period. The court rejected Orchard's argument that the plaintiff repudiated the contract, finding that there was no evidence of such repudiation. Regarding the constructive trust, the court held that a constructive trust arose upon receipt of the advance, as the contract itself was an instrument of fraud. The court further found that the trust was breached by Orchard's payment of the money to other parties.

The court held that the limitation periods under the Limitations of Actions Act applied to the contract and deceit claims, but not to the trust claim. The court found that the plaintiff's causes of action for breach of contract accrued on the due dates for interest and principal payments, all of which were less than six years before the proceeding was commenced. The court found that the plaintiff's deceit claim accrued on the delivery of the bank cheque, which was also less than six years before the proceeding was commenced. However, the court held that the plaintiff could rely on statutory extensions, and that the fraud was discovered within the six-year period. The court held that there was no interaction between the Limitations of Actions Act and equitable defences in relation to claims for fraudulent breach of trust.

The court ordered judgment for the plaintiff for $150,500 and directed the parties to discuss interest and costs.

Orders

Orders of the court

1. Judgment be entered for the Plaintiff for $150,500.

2. I will hear the parties as to interest and costs.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Wylie v Orchard (No 2) [2020] QDC 315
PARTIES:	LYNETTE MARGARET WYLIE (Plaintiff) V ELIZABETH MARGARET ORCHARD (Defendant)
FILE NO/S:	2848/17
DIVISION:	Civil
PROCEEDING:	Trial
ORIGINATING COURT:	District Court at Brisbane
DELIVERED ON:	11 December 2020
DELIVERED AT:	Brisbane
HEARING DATE:	14 – 16 September 2020
JUDGE:	Porter QC DCJ
ORDER:	1. Judgment be entered for the Plaintiff for $150,500. 2. I will hear the parties as to interest and costs.
CATCHWORDS:	CONTRACT — BREACH OF CONTRACT — PERFORMANCE OF CONTRACT – claim in debt under a loan agreement – where the plaintiff entered into a loan agreement with the defendant – where the loan agreement provided that the plaintiff was to advance $100,000 to the defendant to purchase a “franchise from REFUND home loans” – where the loan agreement purported to give the defendant “full discretion as to how Loan funds are dispersed in order to achieve mutually beneficial objectives and provide ongoing employment opportunities for both parties” – where the loan was fixed for three years at which point the capital and interest was due and payable to the plaintiff – where the loan agreement required the defendant to pay the plaintiff 15% interest per annum – where it is uncontentious that the plaintiff advanced $100,000 to the defendant by way of bank cheque – where the defendant subsequently disbursed those funds to third parties – whether this on proper construction of the loan agreement comprised repayment of the debt – whether the plaintiff repudiated the contract by demanding repayment of the principal before its due date – whether the defendant is in breach of the terms of the loan agreement – whether the claim is statute barred CONTRACT – FRAUDULENT MISREPRESENTATION – claim in deceit – where the plaintiff alleges the defendant induced the plaintiff to enter into the loan agreement and to lend the principal to the defendant by fraudulent misrepresentation as to how the defendant she intended to use the advance – where the plaintiff alleges that at the time of obtaining and bank cheque and entering into the loan agreement, the defendant never had the intention of applying the money for the purpose according to the loan agreement – – whether the plaintiff relied on the alleged misrepresentation – where the plaintiff does not give direct evidence of reliance – where the defendant contends that the loss was caused not by fraudulent misrepresentation but either the plaintiff’s repudiation of the contract or failure to pursue relevant person/s – whether the deceit claim is in any event statute barred EQUITY — EQUITABLE REMEDIES — MISREPRESEN TATIONS — INDUCEMENT – claim for breach of trust – where the plaintiff claims a constructive trust arose over money advanced under a loan agreement induced by fraudulent misrepresentation – where the plaintiff contends the constructive trust was breached by payment out of the money other than for the plaintiff’s benefit – where the loan agreement was not rescinded for fraudulent misrepresentation – whether the…