Wentworth v Rogers & Anor

Introduction 1 His Honour: In these proceedings the plaintiff seeks to have set aside certain transactions entered into by the defendants, Mr and Mrs Rogers, in respect of a farming property near Tamworth named "Te Mata". The plaintiff, Ms Wentworth, contends that a deed, transfer and mortgage relating to that property were entered into by the defendants fraudulently for the purpose either of ensuring that she could not obtain satisfaction of any judgment for costs or damages made in her favour in this Court against Mr Rogers or in order to give Mrs Rogers priority if Mr Rogers became bankrupt. Reduced to its essence, the allegation made by Ms Wentworth is that the acknowledgement of indebtedness made by Mr Rogers to Mrs Rogers, set out in the deed and upon which the transfer and mortgage were based, is a sham. 2 At the hearing of this matter Ms Wentworth and Mr Rogers were unrepresented. Mr Lovas of counsel represented Mrs Rogers. The proceedings took place on a number of hearing days from 29 January 2002. The matter was reserved for judgment on 11 November 2002 but the plaintiff sought and was granted leave to file further written submissions. Those submissions were received from the plaintiff on 31 January 2003 and the second defendant replied by submissions filed on 6 February 2003. The first defendant was content to rely upon the written submissions filed on behalf of his wife. In total there were over 100 pages of written submissions placed before the Court by each of the plaintiff and the second defendant. 3 The present claim was commenced by a notice of motion arising in other proceedings between Ms Wentworth and Mr Rogers. Those proceedings were heard and determined by Mr Justice Sperling. During the course of hearing that matter, his Honour severed the subject matter of the notice of motion from the principal matter before him and ordered that the present proceedings be commenced by summons. The plaintiff duly complied with that order and ultimately the proceedings came before me. 4 When opening her case, the plaintiff identified the basis of the relief she sought as the inherent jurisdiction of this Court to protect its own processes. However, it became clear that in substance the claim was that there had been a fraudulent alienation of property and the plaintiff was seeking relief in the nature of that provided by s 37A of the Conveyancing Act. Therefore, over objection from Mrs Rogers, I granted the plaintiff leave to file a Statement of Claim seeking an order under that section and pleading the fraud alleged, see Supreme Court Rules Part 13 rule 2. As none of the parties sought trial by jury and it did not appear to me that it was in the interests of justice to require it, the matter was determined by judge alone notwithstanding the allegation of fraud; see s 88 of the Supreme Court Act. 5 Before reviewing the evidence and the issues raised in the hearing, I should mention two matters that are relevant to the task I am to undertake. Firstly, these proceedings are somewhat unusual in that, although there are significant factual disputes between the parties, it is not a case of word against word. Ms Wentworth's evidence was given by way of affidavits in respect of which she was not cross-examined. The principal purpose of the affidavits was to place before the Court a large amount of material upon which she wished to rely to make out her case. Many of the statements made in the affidavits were subject to objection on the basis that they were argumentative, Ms Wentworth merely drawing inferences or conclusions from the material that she sought to place into evidence. A very significant part of these affidavits was not ultimately relied upon as evidence but was received by me as submissions made upon the evidence as to the financial arrangements of the defendants. 6 In substance the plaintiff is alleging that the defendants acted together to defraud her of the prospect of having any judgments or order made in her favour by this Court being satisfied from the assets of Mr Rogers. She has to prove, at least, that the transactions entered into by the defendants were not bona fide. She seeks to do that, firstly, by drawing inferences about the transactions, the timing of them and the circumstances in which they were made. Next she seeks to show that they are based upon a false premise, being that Mr Rogers was in debt to Mrs Rogers, that debt said to have arisen from the payment by Mrs Rogers of her husband's legal expenses. Finally, she seeks to show that the conduct of the defendants thereafter, particularly in respect of the proceedings between her and Mr Rogers, shows that they had a guilty knowledge of the fraud perpetrated by them and continued in their attempts to frustrate the pursuit of her rights. 7 The resolution of this matter in favour of the plaintiff depends upon whether I am prepared to draw the inferences from the material before me that she wishes me to draw to the necessary standard notwithstanding evidence on oath by the defendants to the contrary. Insofar as I might have to form a view about the credibility of the defendants and, therefore, take into account their demeanour in the witness box, it would be unrealistic and unfair if I did not remain alive to the history and nature of the litigation between Mr Rogers and Ms Wentworth over the past two decades, the acrimonious relationship between the defendants and her, and the fact that they were cross-examined by Ms Wentworth personally in a manner which was, at times, at least confrontational. 8 This brings me to the other significant aspect of this matter: the onus and standard of proof. It is accepted that, because of the nature of the allegations made by Ms Wentworth, she has the onus of proving her case to the standard of proof discussed in Brigenshaw v Brigenshaw (1938) 60 CLR 336. In that case Dixon CJ stated, at 362: