Tracewska v Goonetilleke [2007] NSWSC 340

New South Wales Supreme Court

CITATION : Tracewska v Goonetilleke [2007] NSWSC 340

HEARING DATE(S) : 19 and 28 March 2007

JUDGMENT DATE : 28 March 2007

JURISDICTION : Equity

JUDGMENT OF : Hamilton J

DECISION : Transaction set aside as procured by undue influence and unconscionable conduct.

CATCHWORDS : EQUITY [47] – General principles – Undue influence and duress – Presumption from relationship of parties – In general – Duty arising from relationship of trust.

Bridgewater v Leahey (1998) 194 CLR 457 CASES CITED : Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 547 Johnson v Buttress (1936) 56 CLR 113 Quek v Beggs (1990) 5 BPR 11,761

PARTIES : Jolanta Tracewska by her tutor The Protective Commissioner of NSW (P) Tishan Goonetilleke (D)

FILE NUMBER(S) : SC 4260/06

COUNSEL : A J McInerney (P) No appearance (D)

SOLICITORS : Lee & Lyons (P) No appearance (D)

IN THE SUPREME COURT OF NEW SOUTH WALES EQUITY DIVISION

HAMILTON J

WEDNESDAY, 28 MARCH 2007

4260/06 JOLANTA TRACEWSKA by her tutor THE PROTECTIVE COMMISSIONER OF NEW SOUTH WALES v TISHAN GOONETILLEKE JUDGMENT 1 HIS HONOUR: These are proceedings brought by the plaintiff by her tutor, the Protective Commissioner of New South Wales, claiming an order that the defendant pay her the sum of $193,513.83 being a sum obtained from her by the defendant as a result of the exercise of undue influence or in circumstances which amount to equitable fraud or as money had and received by the defendant from the plaintiff. 2 The defendant has been served with the statement of claim under an order for substituted service. He has been informed of the hearing fixed before me by a communication sent to him in the same fashion. He does not appear. THE FACTS 3 The plaintiff was born in Poland on 6 March 1940. The evidence shows that she is estranged from her family both in Poland and in Australia. She bought a house at Ambarvale near Campbelltown ("the Ambarvale house"). The transfer to her was registered on 24 October 2001. Before that time, during her searches for a property to buy, she came to know the defendant. The defendant is also known as Tishan Garls. 4 At the beginning of July 2003, the plaintiff had no substantial assets other than the Ambarvale house. She had no debts other than about $6,000 still owing to the ANZ Bank under a mortgage of the Ambarvale house. 5 On 17 July 2003 she signed a form of application for a loan from First Mortgage Company Home Loans Pty Ltd ("First Mortgage") through a mortgage originator, Thi Hoa Trieu trading as ET Financial Services. The loan application contained untrue statements that she was working as a hairdresser for Layla Hairdressers and had an income of some $800 per week. She was not working and had never worked as a hairdresser, having been a teacher when she did work. She was not employed at the time. 6 On 15 September 2003 she signed a loan agreement with First Mortgage and a mortgage of the Ambarvale house. Her signature on each of those documents was witnessed by the defendant. On the same day she received from First Mortgage the sum of $193,813.83, which was the proceeds of the mortgage loan after deduction of the moneys owing to the outgoing mortgagee and expenses. She deposited that money into an Access Account with the ANZ Bank which had been opened on 9 September 2003. On 19 September 2003 she transferred that precise sum to a bank account of the defendant. 7 Her own account on affidavit as to how this transaction came about is as follows: "4 I remember Tishan. I got to know him about six years ago when I was looking to buy a house. That was before I bought the house at Ambarvale. I went from one real estate agent to another looking for a house in Fairfield. He was working when I met him at Fairfield. He gave me his cards and he used to call by to see me from time to time.