Berthelsen v Williams[2016] QCATA 89

APPEARANCES and REPRESENTATION (if any):

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (Qld) (QCAT Act).

REASONS FOR DECISION

1. [1]
   Dale Williams and David Berthelsen lived in a de facto relationship from 2006 to December 2011. In April 2011, Mr Berthelsen signed two IOUs; one for $15,000 and one for $23,196. Mr Berthelsen did not pay either of the IUOs so Ms Williams filed two minor debt clams. The tribunal found for Ms Williams in both claims, and ordered Mr Berthelsen pay the two amounts.
2. [2]
   Mr Berthelsen wants to appeal that decision. Because this is an appeal from a decision of the tribunal in its minor civil disputes jurisdiction, leave is necessary.^[1] Leave to appeal will usually be granted where there is a reasonable argument that the decision is attended by error, and an appeal is necessary to correct a substantial injustice to the applicant caused by that error.^[2]
3. [3]
   Mr Berthelsen has always argued that the tribunal had no jurisdiction to hear the claim because the promises to pay were made within a de facto relationship, which was a social relationship, and therefore unenforceable. Mr Berthelsen says that s 44 of the Family Law Act 1975 (Cth) places a bar on commencing proceedings for a de facto property settlement more than two years after separation. He says, therefore, that because Ms Williams needed leave of the Family Court to commence property settlement proceedings, she is also barred from tribunal proceedings. He also argues that the evidence does not support a finding that there was an intention to create legal relations when he signed the IOUs.
4. [4]
   Mr Berthelsen referred the tribunal and the appeal tribunal to Balfour v Balfour^[3] and Cohen v Cohen^[4] is support of his submissions. He also referred to the decision of Member Forbes (erroneously referred to as a judicial member) in Ray v Hope & Anor^[5] as authority for the proposition that the tribunal will not permit action on a promise made in the ordinary course of a domestic relationship.
5. [5]
   Member Forbes considered Balfour v Balfour and Cohen v Cohen, and reached this conclusion, to which Mr Berthelsen referred:^[6]

Indeed the common course of human affairs suggests that in such situations, and even in the context of a marriage or close family relationship, promises to repay money are made without the slightest intention on either side to create, let alone enforce, legal obligations. Absent any such intention or mutual understanding, promises made in social contexts are generally unenforceable in courts of law. Love’s disappointments do not retrospectively alter that position.

6. [6]
   I agree with that statement of the law. The tribunal below obviously agreed with that statement of the law, although the tribunal’s approach to the issue was slightly different:^[7]

…the mere fact that the parties were in a de facto relationship does not oust the jurisdiction of the tribunal. And the question for the tribunal to decide is whether the IOU constitutes a legally enforceable contract and whether, at the time … the parties intended to enter into a legally binding contract.

7. [7]
   The tribunal did not err in its application of the law as explained by Member Forbes.

8. [8]
   A claim for a debt is a very different matter from an action for a family law property settlement. A party may bring an action for debt within six years from the date on which the cause of action arose.^[8] The tribunal did not err in hearing the claim.

9. [9]
   Mr Berthelsen’s real complaint about the tribunal’s decision is that it found, as a matter of fact, that the parties intended to create legal relations.

10. [10]
    The appeal tribunal will not usually disturb findings of fact on appeal if the evidence is capable of supporting the conclusions.^[9] An appellate tribunal may interfere if the conclusion is ‘contrary to compelling inferences’ in the case.^[10]

11. [11]
    The tribunal took care to examine the facts and circumstances of the creation of the IOU and the parties’ relationship generally. Ms Williams told the tribunal that she had good reason to ask for an IOU: Mr Berthelsen’s financial position was a “lot less” than her; they had agreed he would not benefit from anything she had worked for; Ms Williams had a small settlement from a previous relationship and she wasn’t prepared to risk that amount in a new relationship^[11]. She told the tribunal that “it was always understood” that Mr Berthelsen was on his own financially and she was not going to contribute more than him.^[12]

12. [12]
    The amounts Ms Williams advanced to Mr Berthelsen were significant. She paid $15,000 for a Harley Davidson. She bought a Suzuki Vitara, put a bull bar on it and paid for a garage.

13. [13]
    That is a very different situation from that encountered by Member Forbes in Ray v Hope. In that case, the claim was for vet fees, a dog blanket, petrol and tickets to a music festival totalling $421.47. There was no document recording a loan.

14. [14]
    As in the present case, Ray v Hope became a question of credit between two competing witnesses. The tribunal found, and Member Forbes accepted, that there was some documentary evidence to support one party’s version over the other party’s version.

15. [15]
    So too, in this case. There were documents – the IOUs – to evidence a loan. I read the transcript and considered the material filed. The evidence can support a finding these payments were loans, the parties intended to create legal relations, and Ms Williams was entitled to be repaid. I can find no compelling reason to come to a contrary view.

16. [16]
    There is no reasonably arguable case that the tribunal was in error. Leave to appeal should be refused.