1288/06 MICHAEL JOHN VAUGHAN v MELISSA BONGIORNO
6224/06 DAVLITE PTY LTD v MELISSA BONGIORNO
JUDGMENT
1 HIS HONOUR: This is an application for Mareva relief in rather contorted proceedings between the plaintiff and the defendant. The plaintiff is a man of 59, who is by profession a solicitor. The defendant is a woman of 33 who is, or certainly was at material times, a student. There was undoubtedly a sexual relationship between them over a period of years. Over that period, it seems undoubted that the plaintiff furnished nearly a million dollars to the defendant, a great deal of which was expended on the purchase of real estate in the defendant's name or the support of loans raised for the purpose of purchasing that real estate.
2 Out of the somewhat contorted and unsatisfactory versions of the facts given in quite lengthy affidavits by both parties, there peer three scenarios as to the characterisation of the legal relations between the parties which could conceivably be asserted in the proceedings. The first is that the money was lent by the plaintiff to the defendant. The second is that the moneys were paid by the plaintiff into properties bought in the defendant's name, which would lead to the existence of a resulting or other trust relating to those properties in favour of the plaintiff. The third is that there was in fact a domestic relationship between them that fell within the Property (Relationships) Act 1984 ("the PRA") and that it might be appropriate for there to be an adjustment of interests between them under the PRA.
3 From these scenarios which, as I say, peer out of the evidence, one has been selected by the plaintiff to be propounded in his statement of claim, that is, that the funds were lent by the plaintiff to the defendant. There was not one loan but many. They are all asserted by the plaintiff in the statement of claim to be repayable on demand.
4 That is the case which the plaintiff seeks to make out as a basis for Mareva relief. He has had the advice of Senior Counsel and he has eschewed, through Mr Dlakic, solicitor, who has appeared for him today, any claim upon a trust basis being raised at this stage. It is certainly not appropriate for him to claim relief under the PRA because he specifically denies that there was a relationship which fell within the PRA.
5 From the numerous transactions traversed in the statement of claim the plaintiff has put forward before me the transaction or transactions relating to three pieces of real estate as being the loans selected to found an entitlement to Mareva relief. Those three properties are 5/389 Liverpool Street, Darlinghurst ("the Darlinghurst property"); 4/4 Elkhorn Avenue, Surfers Paradise ("the Elkhorn Towers property") and 11/4 University Drive, Robina ("the Robina property"). In the case of each it is specifically alleged (pars 4, 44 and 52) that the loan would be repayable on demand.
6 The criterion most frequently cited in this State for the grant of Mareva relief is the dictum of Gleeson CJ when Chief Justice of this Court in Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319 at 321 - 322:
"The remedy is discretionary, but it has been held that, in addition to any other considerations that may be relevant in the circumstances of a particular case, as a general rule a plaintiff will need to establish, first, a prima facie cause of action against the defendant, and secondly, a danger that, by reason of the defendant's absconding, or of assets being removed out of the jurisdiction or disposed of within the jurisdiction or otherwise dealt with in some fashion, the plaintiff, if he succeeds, will not be able to have his judgment satisfied."
7 There has been a good deal of discussion of the degree of proof needed to establish the second matter in that criterion, namely, the apprehension of dispersal of assets. There has been less discussion of the quality of the evidence necessary to establish the first matter specified by Gleeson CJ as a prima facie cause of action.
8 As to the criterion by reference to which the first matter is to be established, Gleeson CJ spoke of the establishment of "a prima facie cause of action". In Patterson's case Meagher JA (at 326) broadly agreed with Gleeson CJ. Rogers AJA (at 328 - 329) preferred the formulation of the minimum standard of proof of the first matter as a "good arguable case". In Earthline Constructions Pty Ltd v State Rail Authority of New South Wales NSWCA 26 February 1992 unreported, Kirby P at [2] used the formula "a serious question to be tried". In the High Court, Brennan CJ, McHugh, Gummow, Kirby and Hayne JJ in Patrick Stevedores Operations No 2 Proprietary Limited v Maritime Union of Australia (1998) 195 CLR 1 at [76] spoke of "a serious question" (to be tried). The formulation by Gaudron, McHugh, Gummow and Callinan JJ in Cardile v LED Builders Pty Limited (1999) 198 CLR 380 at [68] was of the applicant having "to show a reasonably arguable case on legal as well as factual matters". I am indebted for this collection of formulae to Biscoe on Mareva and Anton Piller Orders (2005): see [6.3].
9 Going back to classic authority concerning interlocutory injunctions, it was said in the High Court in Beecham Group Limited v Bristol Laboratories Pty Limited (1968) 118 CLR 618 at 622 that prima facie case means:
"that if the evidence remains as it is there is a probability that at the trial of the action the plaintiff will be held entitled to relief."
10 I propose to continue to adopt, as I have now for some years adopted, the formulation by Gleeson CJ in the Patterson case of the establishment of a prima facie cause of action. I do not think that I should come to any different conclusion on this application if I adopted any of the other formulations mentioned. It seems to me that, in the formulation in the Beecham Group case, a prima facie case means that, if the evidence remains as it is, there is a probability that at the trial of the action the plaintiff will be held entitled to relief, these days what is referred to by "a probability" is not a probability in the sense of a better than 50 per cent chance of success. But the importance of the Beecham formulation for present purposes is a reference to the evidence remaining as it is, that is, the evidence before the Court on the interlocutory application. If that evidence is contested, of course, the conflict will not be resolved.
11 The problem for the plaintiff in this case is the quality of the evidence on which he relies to establish that the transactions between the parties were transactions of loan and that the loans were repayable on demand, which is the sole basis on which the plaintiff's case is put in the statement of claim. The laws of evidence are not applied in general with any great strictness in civil proceedings in this Court these days. As to conversations, the old oratio directa rule upon which many of us were brought up proves on research to be a phantom and never really to have existed: see 7 Wigmore on Evidence (Chadbourn rev, 1978) s2097; Francisco Carlos Godinho (1911) 7 CrAppR 12; R v Noble [2002] 1 Qd R 432. Evidence is given and admitted in these days of conversations where it is necessary - as it is in this case because the agreements are said to be oral - in indirect speech.
12 The plaintiff's affidavit was not objected to. The accounts he gives of the three transactions or sets of transactions on which the plaintiff relies in this application are given in terms of generality and imprecision. But, even in a general and imprecise way, the evidence does not succeed in giving versions of conversations which would support loans repayable on demand.
13 Mr Dlakic has conducted the application before me with vigour and resolution and has put the matters that could be put in support of his client's case. Mr Dlakic has said that it is certainly clear from the evidence that the plaintiff believes, or it is his version, that these loans were repayable on demand and that he demanded repayment. The difficulty is that, in respect of the three transactions, there really is no account of conversations between the plaintiff and the defendant which could be taken as supporting a contract of loan repayable on demand or, to put it in the manner of the statement of claim, that there was a term of the loans that the moneys would be repayable on demand.
14 In relation to the Darlinghurst property, in the only sentence that really refers to the relevant conversation between the plaintiff and the defendant, the plaintiff states:
"To assist the defendant complete the purchase of the property I lent the defendant the balance of the purchase moneys and it was agreed that, upon the sale of the property, the money advanced by me would be repaid."