Posted by: Daryl & Wendy Ashby | September 16, 2010

One Kind Act Merits a Caveat

After Charles Irvine and Soozie Cooper met through an internet dating service in March 2006, they entered into a sexual relationship.   Charles was a successful businessman while Soozie was less financially secure.   She had a job, owned her home and was paying off a bank mortgage.   Charles’ and Soozie’s relationship lasted until they had an argument in January 2007.   They were never de facto partners, remained friends then became opposing Supreme Court litigants.

In June 2007 Soozie told Charles about her financial problems.  Over the next six months he happily helped  out his former girl-friend with eight deposits totaling $10,500 to her bank account  enabling Soozie to pay off a personal loan, a hospital account and to reduce a credit card debt.  She did not accept Charles’ other to pay off her mortgage and take a caveat over her home to secure this payment. 

During this time Charles helpfully suggested to an apparently depressed Soozie that she should go north with her animals.  Soozie considered this, decided to sell her home and quickly found one on the Sunshine Coast.  But she could not afford to buy it without Charles’  help.    No worries.  Within days cavalier Charles paid a $1000 deposit on a contract for Soozie’s Sunshine Coast purchase and later placed  $382,354 (representing balance purchase monies, costs and outlays) in her solicitors’ trust account.

On 4th December, while emailing trust account details, Soozie reassured Charles:  “I will keep track of all these monies and repay you”.

A week later Soozie asked Charles’ what price she should accept for her house, then explained:  “I want to sell asap so you get your money.”  “That’s  an incentive for me,”  she continued,   “The more I get, the more you get”.

On 12th December, after Charles made the final payment for her purchase, Soozie emailed him asking when he wanted her to sign “that paper” which he was “having drawn up about the money.”

Charles said his lawyers had been slack in getting the paperwork done. “ Technically we do not know each other’s share until your house sells so there is no hurry,” he added before promising to get onto it and let Soozie know.

Before Soozie moved into her Sunshine Coast  property she and Charles had a celebratory dinner  where she asked “about signing something for the house”.  Charles mentioned how Soozie now had the house and her mortgage would shortly be out-of-the-way.  They could both get on with their lives, he said, particularly because he was in a new relationship.

In January 2008 Soozie wondered if they might get back together.  When Charles said this was unlikely, Soozie asked why he had handed over so much money if he did not want a relationship.   Charles said he liked her, and had continued to support her when she was in trouble because he was helping her get on with her life.

Soozie soon settled her sale, paid off her mortgage and collected net proceeds of $160,000.   This prompted Charles to initiate the documentation for his security over her new home.  But Soozie’s tune had changed.  She emailed Charles that she would not sign anything:  “I will as we agreed that one day, if and when I do come into some money, then give you whatever I can at that time, that was our agreement and that is what I will stick to.”

This was not good enough for Charles who lodged a caveat over Soozie’s title before commencing court proceedings.

The essential issue in court was whether Charles intended to make a loan or a gift.  Because Charles could not prove any concluded agreement for his advance to be secured over Soozie’s property, the judge ruled that Soozie would need to show that the moneys paid were a gift.  Soozie could not discharge that onus, so the judge found in all the circumstances that Charles had made a loan –  with the intention that Soozie’s property be equitably charged in his favour for repayment  of his $382,354 (without interest) upon her death or earlier sale of the home.

Soozie , who represented herself, was ordered to pay Charles’ costs and had to consent to a further protective caveat

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